Cosmo First, a manufacturer of specialty films used in packaging, label, lamination, and industrial applications, on 14 February declared its financial results for the quarter that ended December 2022. Net revenue in the financial year (YTD) 2023 was Rs 2,350 crore, up from Rs 2,218 crore in FY(YTD) 2022. The net revenue in Q3 of FY 2023 was Rs 730 crore, down from Rs 778 crore in Q2.
EBITDA was Rs 360 crore in FY (YTD) 2023, profit before tax (PBT) Rs 269 crore, and profit after tax (PAT) was Rs 212 crore. In FY 2022, EBITDA was Rs 455 crore, PBT Rs 382 crore and PAT was Rs 288 crore.
During the quarter, the BOPP and BOPET industry faced excess supply caused due to the bunching of new production lines and demand disruptions in the overseas markets. The contribution margin dropped below sustainable levels and impacted everyone in the industry. The company mitigated the impact on the back of its strong presence in the specialty films segment.
The performance could have been better but for the one-time inventory loss in raw materials and finished goods (both in India and subsidiaries); planned maintenance of some of the production lines; the restricted flow of orders for specialty films due to the festive and holiday seasons in Europe and the US and; larger funding of operating deficit in the rapidly growing Petcare vertical, the company said.
The BOPET line, which was commissioned towards the end of last quarter, continued to focus on perfecting recipes, processes, and quality parameters for various specialty and value-added films in line with the company’s entry strategy in polyester films.
The company’s petcare vertical is rapidly and clocked a monthly run rate of Rs 1 crore in sales revenue from its 11 experience centers in various locations and increasing online presence through its website and mobile app.
The company’s financials remain strong with an annualized ROCE and ROE at 20% and 25% respectively and net debt to EBITDA of less than one time.
In December 2022, the company announced the buyback of its shares from all the shareholders via a tender route with an outlay of Rs 108 crore. The offer period ended on 9 February 2023 and the shareholders should receive payment by 20 February 2023 as scheduled.
Commenting on the company’s performance, Pankaj Poddar, Group CEO, Cosmo First. said “the near-term outlook for BOPP and polyester films is expected to be challenging though the company’s strong specialty films portfolio should deliver superior returns. Zigly is rapidly becoming well known among pet parents benefiting all pet lovers and the company’s shareholders. Specialty chemicals division should double its net revenues while actively focusing on new product launches.”
Founded in 1981, Cosmo First has a presence across more than 100 countries around the globe. Cosmo First is a global name in specialty films and an emerging player in specialty chemicals (masterbatches, adhesive, coating & textile chemicals) along with a digital-first omnichannel pet care business under the brand name Zigly.
