D E A R S TA K E H O L D E R S
I am delighted to share with you that the year 2018-19 was yet another eventful yearfor the Company during which we continued to hit the right milestones. The year underreport was one of considerable success evident in the 22% YoY growth in our retail salesand 37% growth in PAT. We have been able to demonstrate strong growth in our retailoperations that span across two of the largest developed economies of the US and UK whereconsumer spending drives almost two-thirds of their respective GDPs. Both the markets areseeing growing contributions from jewellery and non-jewellery products. We are witnessingplatforms and products increasingly complementing and enhancing the overall revenues.
Our dynamic business model congruent with the ever-changing business environment hasDelivering Joy' as the central theme with a steadfast focus on positive contributionto various stakeholders.
Delivering Joy at VGL
Our products deliver immense joy to our customers. Having mapped our customers'preferences and behavioural patterns VGL has found a sweet spot as a deep valuediscounter of fashion jewellery accessories and lifestyle products. VGL has expanded thequality and scale of sourcing and supply chain while also helping bring products on-airwithin the shortest possible time. During the year we introduced such exclusive fashionproducts as granderite and shungite stones and Moroccan amethyst which were big hitsamong our customers. This emphasis on deal-driven discovery is nowhere more visible thanShop LC's Birthday Bash program during which we sold a record 75000 pieces within asingle day.
We have enabled our consumers to seamlessly fulfill their societal responsibilitywhile they are pursuing their lifestyle choices. We have linked our business directly withour flagship CSR initiative the One for One' program. Thus product sales benefitchildren who get a hot nutritious meal in school for every product sold at our retailchannels - Shop LC in the US and TJC in the UK. It gives me immense pleasure to share withyou that we have provided over 25 mn meals across the US UK and India since the inceptionof this program. This delivers joy to them while enabling our business to have a positiveimpact on both education and nutrition.
Human resources form the basis on which an organisation grows. To strengthen thefoundation our people-oriented endeavours are aimed at holistic development throughvarious skill development programs and health and wellness programs. These initiativesfoster a fulfilling work environment in turn delivering joy and satisfaction to ouremployees. This is reflected in strong growth in revenues and profitability and in some ofour operating units being recognised as high performers in the 'Great Place to Work'surveys.
Strong business growth has enabled the enhancement of value distribution to ourinvestors and shareholders. We announced an interim dividend of C5 per share and a finaldividend of C5 per share taking the total pay-out at over 20% of profit for the financialyear 2018-19.
Strong performance of 2018-19 was the outcome of our concerted efforts in strengtheningthe foundations of our business including technology platforms data analytics customercentricity and supply chain while maintaining affordable ASPs across a larger and morediverse product catalogue. Furthermore augmentation of our symbiotic omni-channel salesnetwork comprising TV web mobile apps smart TV interfaces OTT platforms social andthird-party marketplaces also helped fuel growth. It is also encouraging to see theincreasing contribution of web sales to our retail revenues.
Our revenues rose 15% to C1814 cr Gross profit increased 21% to C1133 cr EBITD Aimproved 37% C217 tocr Net profit grew 37% to C154 cr
I am confident of the intrinsic strength of our business model and believe that we willbe able to sustain the current growth rate over the coming years.
OUR SYMBIOTIC OMNI-CHANNEL SALES NETWORK COMPRISING THE COMPOSITE OF TV AND WEB HELPEDFUEL GROWTH IN 2018-19.
We are committed to make sure that the world has a sustainable future and acceptablestandards of living for all. We focus on a number of high-impact social responsibilityinitiatives that help address some of the basic issues faced by societies today includingeducation nutrition social infrastructure reinforcement healthcare etc. We are proudof our association with Akshaya Patra the world's largest NGO-run school meals programand continue to seek ways to enhance the scope of our involvement.
We are cognisant of the ecological challenges the world today faces and have beentaking conscientious steps at maintaining the ecosystems that we operate in. Oursustainability program is all-encompassing and covers renewable sources of energyrainwater harvesting waste management tree plantation power savings and the like.
We embrace the highest governance practices and have robust process controls in place.Furthermore our Board plays an active role in the Company's governance and providescounsel on a wide range of issues.
WE FOCUS ON A NUMBER OF HIGH-IMPACT SOCIAL RESPONSIBILITY INITIATIVES THAT HELP ADDRESSSOME OF THE BASIC ISSUES FACED BY SOCIETIES TODAY.
Outlook and prospects
We believe we have created strong global equity in the electronic retail space offashion jewellery accessories and lifestyle products. Investing in foundationalinitiatives over the past few years has enabled superior growth in the year under reviewand we are confident of delivering accelerated long-term value to our stakeholders in thecoming years as well.
Our unique product value propositions and deep discounting model are well-recognisedamong our customers allowing us to scale-up and harmonise adjacent complementarycategories such as lifestyle products. This synergy reinforces the quality and depth ofour catalogue while also creating the platform for greater customer engagement and higherrepeat sales.
Order fulfilment is among the most important aspects of B2C success in electronicretail and I am enthused by the progress we have achieved on this front. We have largemulti-locational warehousing facilities reputed logistics companies as our deliverypartners and specialist call centre operations for enabling customised customer service.We are also at par with competitors in terms of offering affordable payment solutionsthrough our Budget Pay' option easy returns and assured delivery. However ourunique differentiation is in our attractive ASPs which are 40-50% lower than ourcompetitors. Value pricing will continue to be our principal differentiating factor in thefuture too.
Beaming a larger catalogue to a bigger number of households in the US and UK whilepivoting around our deal-driven discovery-based deep discounting model is what is mostexciting and we look forward to achieving stronger progress in the months and yearsahead. We have built strong financial and operational foundations that will enable us towin newer customers and create value for shareholders.
WE SEE SIGNIFICANT
POTENTIAL FOR OUR FASHION JEWELLERY ACCESSORIES AND LIFESTYLE PRODUCTS IN THE US ANDUK MARKETS.
I would like to take a moment to extend our sincere gratitude to our workforce fortheir dedication and hard work. Their deep and innate skills and craftsmanship make usproud. We also express gratefulness to our loyal customers for their belief in our valuepropositions. They encourage us to bring to them unique products that enrich theirlifestyle. We thank our shareholders and appreciate the faith they have shown in ourCompany's management leadership and future. Our sincere thanks also to our financiers andbankers suppliers and communities for the work they do in support of our business.