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United Spirits Q3 net declines 19 per cent at Rs 65 crore

Net sales of the company increased to Rs 2,278.40 crore for the quarter, compared to Rs 2,174.01 crore during the same period of previous financial year.

twitter-logoPTI | February 14, 2014 | Updated 14:04 IST
United Spirits Q3 net declines 19% at Rs 65 crore

Liquor major United Spirits has posted a 19.40 per cent decline in net profit at Rs 64.92 crore for the third quarter ended December 31, 2013.

The company had posted a net profit of Rs 80.55 crore during the same period of previous financial year.

Net sales of the company increased to Rs 2,278.40 crore for the quarter, compared to Rs 2,174.01 crore during the same period of previous financial year.

"The quarter had seen a slowing of growth in the Prestige and above segment to 12 per cent, represented by an increase of a million cases over the comparable period," the company said in a statement.

The Bangalore-headquartered firm said its key brands, including McDowell's range and Royal Challenge, have posted growth during the quarter.

The company said the Office of Fair Trade (OFT) UK has indicated that there is a realistic prospect of a lessening of competition as a consequence of Diageo's investment in and control over USL, of which Whyte & Mackay (W&M) is a wholly-owned subsidiary.

"The company is evaluating options that could bring down such perceived competition to levels acceptable to the OFT (without jeopardising its supply side security) and has set in motion a process to enable a possible sale transaction of the stipulated W&M assets during the April-June quarter of FY15," it added.

Last year, OFT had decided to have a fresh look at the 2 billion deal, after Diageo offered to divest bulk of Whyte & Mackay (W&M) business to address anti-competition concerns posed by this merger.

United Spirits had acquired W&M for about 595 million pounds (then nearly Rs 5,000 crore) in 2007.

In July 2013, Diageo completed acquisition of a 25.02 per cent interest in United Spirits, while it has now raised its stake to close to 30 per cent.

While the deal has been cleared by various regulators, including India's fair trade watchdog CCI, OFT ruled in November last that the merger may substantially lessen competition in the supply of blended whisky to retailers.

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