Campus Activewear Limited’s management statements at the start of FY2024–25 regarding growth, efficiency, and operations, along with a comparison to the actual performance achieved during the year.
Growth
At the outset of FY2024–25, management expressed an optimistic outlook, forecasting robust double-digit revenue growth driven by an aggressive push in both offline and online channels. They emphasized strategic initiatives such as expanding the retail footprint (with new store additions), enhancing distribution channels, and launching an array of new SKUs—especially in the sneaker and women’s categories—to capture a larger market share. The goal was to outpace the industry average and build on the strong brand recall the company had built over the previous years.
Actual Performance in Growth:
In Q3 FY25, Campus Activewear reported a 9.1% year-over-year revenue growth, and H1 FY25 saw revenue growing by approximately 9.8% YoY. While these figures represent positive growth, they were somewhat below the “double-digit” target initially anticipated. Nevertheless, the company did record significant volume increases—such as a 36.3% YoY increase in sales volume in Q2 FY25—indicating strong market demand, even if revenue growth did not fully meet the highest expectations.
Efficiency
Management at the beginning of FY2024–25 set out to improve operational efficiency through supply chain optimization, better working capital management, and streamlining of overhead costs. They anticipated a significant uplift in EBITDA margins—by focusing on reducing non-moving inventory and shortening the working capital cycle—and aimed to improve profitability metrics even amidst challenging macroeconomic conditions.
Actual Performance in Efficiency:
In Q3 FY25, Campus Activewear’s EBITDA margin expanded by about 4.4 percentage points (from 12.2% in Q3 FY24 to 16.6% in Q3 FY25), demonstrating effective short-term efficiency gains. However, on an annual basis, EBITDA margins declined from 17.27% in FY23 to 14.87% in FY24, suggesting that while some operational efficiencies were realized, overall cost pressures (e.g., rising raw material costs) and other macroeconomic factors dampened broader improvements in efficiency.
Operations
Management highlighted a focus on strengthening operations through expanding the retail network, launching innovative product lines, and enhancing the omni-channel experience. They mentioned plans to add new exclusive brand outlets (EBOs) and invest in digital transformation initiatives to better track consumer trends, which would drive better product planning and inventory management.
Actual Operational Performance:
Campus Activewear successfully added new stores—nine in Q2 FY25—raising the total count of EBOs to 290, and launched 69 new SKUs in Q3 FY25. These initiatives aligned closely with management’s operational goals, indicating that the company largely met its targets in expanding its retail network and product diversification.
Conclusion
While the actual revenue growth in FY2024–25 fell slightly short of the high double-digit expectations set by management, the company did show solid performance in sales volume increases and retail expansion. Efficiency gains were evident in quarterly EBITDA improvements, even though annual margins suffered due to external cost pressures. On the operations front, the tangible progress in store expansions and new product launches demonstrates that Campus Activewear executed its strategic plans effectively. Overall, management’s statements on operations were closely mirrored in the actual performance, while growth and efficiency targets were met to a respectable, albeit slightly lower, degree than originally forecast.