Honasa Consumer Reports Rs 18.57 Cr Loss In Q2FY25

With inventory adjustments impacting the profitability, Honasa Consumer, the parent company of the fast-moving consumer goods (FMCG) brands such as Mamaearth and The Derma Co, has reported a consolidated loss of Rs 18.57 crore in the second quarter of the current financial year (Q2FY25). The company had posted a net profit of Rs 29.43 crore in the same quarter a year ago.

As per the unaudited consolidated financial results for the quarter, the company reported a 6.9 per cent decrease in its revenue from operations as it dipped from Rs 496.10 crore in Q2FY24 to Rs 461.82 crore in the quarter ended 30 September 2024. The company, in a statement, stated that the revenue adjusted for inventory correction was Rs 525 crore with the growth rate of 5.7 per cent on a year-on-year (YoY) basis.

As per the company’s statement, the EBITDA (earnings before interest, taxes, depreciation and amortisation and amortisation) margin, reported for Q2FY25 was (6.6 per cent), with EBITDA Margin adjusted for inventory correction at 4.1 per cent. Revenue growth, adjusted for inventory correction, in H1FY25 stood at 12.3 per cent.

“Over the past few months, we have been implementing Project Neev to optimise our distribution model. In this quarter, we have taken strategic steps towards transitioning from super-stockists to direct distributors in top 50 cities. This transition has impacted our revenue and profits, leading to a slowdown for Mamaearth. However, this realignment will also strengthen offline go-to-market (GTM) strategy in the quarters ahead, setting the stage for our next phase of growth,” stated Varun Alagh, Chairman and Chief Executive Officer (CEO), Honasa Consumer.

The total expenses of the company increased from Rs 463.98 crore in the second quarter of the previous financial year (Q2FY24) to Rs 506.21 crore in the recently concluded quarter (Q2FY25), witnessing a 9.10 per cent YoY rise. The total income of the company also declined from Rs 503.18 crore in Q2FY24 to Rs 481.84 crore in Q2FY25, marking a dip of 4.24 per cent on a YoY basis.