Arrow, Calvin Klein and Tommy Hilfiger retailer Arvind Fashions' Q1 profit falls 24 pc
Mumbai, July 21
Arvind Fashions, the Indian retailer behind premium apparel brands including Arrow, Calvin Klein and Tommy Hilfiger, on Tuesday reported a 23.8 per cent decline in consolidated net profit for the first quarter of FY27, as higher costs weighed on earnings despite strong revenue growth.
The company's net profit fell to Rs 9.6 crore in the quarter ended June 30, compared with Rs 12.6 crore in the corresponding quarter of the previous financial year (Q1 FY26), according to its stock exchange filing.
Revenue from operations rose 15.5 per cent year-on-year to Rs 1,279 crore from Rs 1,107 crore, driven by healthy demand and higher marketing investments across its portfolio of brands, as per its filing.
Commenting on the performance of the company, Amisha Jain, MD & CEO said that the company has begun the year with a strong operating performance, delivering revenue growth of 15.5 per cent and EBITDA growth of 19.6 per cent.
"This performance is particularly noteworthy given the inflationary environment shaped by the West Asia conflict, higher petroleum prices, elevated forex rates and minimum wage increases across several states, and reflects the resilience of our brand portfolio and the discipline of our operating model," Jain added.
"Looking ahead, our focus remains on accelerating growth across retail and B2C channels while keeping an eye on the impact of war," Jain mentioned.
The EBITDA margin improved to 12.5 per cent from 12 per cent in the year-ago period, reflecting better operating efficiency, it added in its filing.
However, total expenses climbed 15 per cent to Rs 1,245 crore during the quarter, impacting the company's bottom line.
Arvind Fashions said the quarter was marked by rising raw material costs, partly triggered by the Iran conflict, which added pressure on input prices.
The company also flagged the continuing geopolitical tensions in West Asia and the impact of El Nino on the monsoon as potential drivers of inflationary pressures in the coming months.
It further cautioned that increasing raw material costs and a weakening rupee could affect future capital expenditure plans.
Following the earnings announcement, shares of Arvind Fashions fell about 3.4 per cent in trade.
The company continues to operate a portfolio of international and premium fashion brands, including Arrow, Calvin Klein and Tommy Hilfiger, along with several other lifestyle labels in the Indian market.
— IANS
Reader Comments
Honestly, I'm not surprised. Every time I walk into an Arrow or Tommy Hilfiger store, the prices are sky-high. With inflation and rupee weakening, it's going to be even more expensive for us consumers. The company might be blaming the West Asia conflict, but they should also look at their own pricing strategy. 🛍️
Good to see EBITDA margin improving to 12.5%. That shows operational discipline despite the headwinds. The MD's comment about 'inflationary environment' is spot on - with El Nino affecting monsoon and global tensions, it's tough for any FMCG or retail company. Revenue growth is impressive though, especially for premium brands in a price-sensitive market like India. 👍
I wonder how much of this 15% revenue growth is actually from new customers vs just price hikes. With raw material costs rising and rupee weakening, companies like Arvind Fashions will pass on costs to us. The premium segment might survive, but what about middle-class families buying these brands? Hope they're not just chasing quarterly numbers. 💰
At least they're transparent about the challenges - West Asia war, El Nino, forex issues. Many companies just say 'difficult environment' without specifics. But 24% profit drop is serious. I hope they invest in better supply chain management and maybe local sourcing to reduce dependency on imported materials. Profit is not everything, but it's crucial for long-term survival. 🌍
The stock fell 3.4% after this news -
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