Packaged foods maker Britannia Industries Ltd on Tuesday reported a 3.2 per cent dip in March quarter consolidated net profit at Rs 360.07 crore, much lower than Street estimates on account of higher input cost pressures and a pickup in its advertising and promotional spends. Sales were in line with expectations. Consolidated revenue grew 9.17 per cent year-on-year to touch Rs 3,130.75 crore for the three months ended 31 March, 2021, the company said in a filing. Revenue from operations stood at Rs 2,867.70 crore in the same period last year.

During the quarter the company also implemented three digital vendor and dealer management projects that led to shutdown of operations for a few days in March. This impacted billing for the quarter, the company said.

The maker of Good Day cookies and Britannia branded bread reported a profit of Rs 372.35 crore in the year ago period. Over earnings call on Tuesday evening the company’s top management flagged inflationary concerns and said the current covid situation is worse than the previous year. Companies are however better prepared this time around.

This, said the company, will prompt households to pantry stock and buy more packaged foods for another three to four months, highlighting that in-home consumption of essentials is likely to benefit companies that sell packaged staples and snacks.

On the commodity cost front, palm oil, packing material and dairy products witnessed sudden and steep increases while strategic buying helped the company manage the cost increases better, the company said. We are evaluating the long-term impact of these increases to action necessary price increases while ensuring competitiveness,” Varun Berry, managing director, Britannia Industries Ltd said in a statement. It took selective price hikes towards the end of the quarter.

“The inflation is leading us to a situation where we would have about 3 per cent material inflation, which is basically coming from edible oil, dairy, packaging material, and price increases in diesel. And that’s something that we have to mitigate as we go forward,” Berry said over a post-earnings call.