Sapphire Foods Q2 FY27 Results (NSE: SAPPHIRE)
Signal: Loss narrowed
The read
The key inflection is sequential: despite 19.6% YoY revenue growth and a 54bps YoY EBITDA-margin improvement to 14.3%, consolidated PAT reversed from Rs 140.22 million profit in Q1FY27 to a Rs 15.13 million loss as operating profit before exceptional items fell to a Rs 5.79 million loss and a Rs 13.27 million merger-related charge was recognized.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹888.03 Cr | +19.6% | -0.3% |
| EBIT | ₹25.58 Cr | +428.1% | |
| Net profit | ₹-1.51 Cr | N/M: loss narrowed from Rs 127.87 million | |
| EPS | ₹-0.05 | N/M: loss per share narrowed | |
| EBIT margin | 14.3% |
P&L walk
Consolidated revenue rose to Rs 8,880.27 million, +19.6% YoY but -0.3% QoQ; gross margin improved 50bps YoY to 68.3%, while EBITDA margin increased 54bps YoY to 14.3% but fell 140bps QoQ, leaving operating profit before exceptional items at Rs 5.79 million loss and PAT at Rs 15.13 million loss after a Rs 13.27 million merger-related exceptional charge.
Segments
The group operates as one reportable restaurant segment; subsidiaries contributed Rs 1,367.58 million of quarterly revenue and Rs 33.76 million of net profit, cushioning standalone revenue of Rs 7,512.69 million and standalone loss of Rs 57.02 million to consolidated revenue of Rs 8,880.27 million and loss of Rs 15.13 million.
Key positives
- Consolidated revenue reached Rs 8,880.27 million, +19.6% YoY, while H1 revenue increased 17.1% to Rs 17,789.87 million.
- Gross margin expanded 50bps YoY to 68.3% as raw material cost declined to 31.7% of revenue from 32.2%.
- Derived EBITDA grew 24.3% YoY to Rs 1,269.13 million versus 19.6% revenue growth, with EBITDA margin up 54bps YoY to 14.3%.
- H1 operating cash flow rose 43.7% YoY to Rs 3,049.85 million, providing cash support despite reported quarterly loss.
Key concerns
- Consolidated PAT turned from Rs 140.22 million profit in Q1FY27 to a Rs 15.13 million loss in Q2FY27 as operating profit before exceptional items declined to a Rs 5.79 million loss.
- Other expenses grew 23.0% YoY and 1.5% QoQ to Rs 3,630.64 million, outpacing sequential revenue and driving the 140bps QoQ EBITDA-margin contraction.
- Standalone PAT remained a Rs 57.02 million loss despite 21.9% YoY revenue growth, indicating that the parent operation is still not converting revenue into bottom-line profit.
- Finance costs increased 7.9% YoY to Rs 331.06 million even though the consolidated balance sheet showed net cash of Rs 518.58 million.
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