India's Britannia Industries (BRIT.NS) reported first-quarter profit below market expectations on Thursday, as higher fuel and shipping costs linked to the Middle East conflict overshadowed stronger demand for its packaged foods.
Consolidated profit rose 14% to 5.91 billion rupees ($62.07 million) for the quarter ended June 30. Analysts, on average, had expected a profit of 6.05 billion rupees, according to data compiled by LSEG.
The U.S.-Israel war on Iran has saddled corporations worldwide with higher energy, freight and commodity costs, squeezing margins and prompting price increases for everything from packaged foods to tyres.
"The year started with West Asia conflict, leading to a steep increase in cost of fuel and shipment charges across our domestic & international businesses," Britannia CEO and Managing Director Rakshit Hargave said in a statement.
Britannia's cost of materials consumed climbed 10% to 28 billion rupees during the quarter.
"We continue to closely monitor the evolving geopolitical situation in West Asia and crude oil volatility for potential impact on international operations and domestic input costs," Hargave said.
Revenue rose 8% to 50 billion rupees, above analysts' estimates of 49.86 billion rupees, as sales volume climbed.
Britannia's packaged food peers Tata Consumer Products (TACN.NS) and Nestle India (NEST.NS) reported profit increases, while Classic cigarette maker ITC (ITC.NS) and Dove owner Hindustan Unilever (HLL.NS) posted declines.
Shares in Britannia closed marginally lower ahead of the results, taking the stock's decline to roughly 10% this year.
($1 = 95.2200 Indian rupees)
