ITC Q1 net rises over 18% to Rs1,891.33 crore

Diversified business group ITC Ltd has reported an 18.05 per cent increase in net profit at Rs1,891.33 crore for the quarter ended 30 June 2013, helped by good performance across business verticals.

The company had reported net profit of Rs1,602.14 crore in the corresponding quarter of the previous financial year.

ITC's net sales during the April-June 2013 quarter increased by 10.31 per cent to Rs7,338.52 crore, compared with Rs6,652.21 crore in the corresponding period last financial year, the company said in a statement.

Gross revenue for the quarter grew by 13.4 per cent to Rs10726.84 crore helped by strong agri business and FMCG perfomances.

Profit before tax increased by 18.2 per cent to Rs2,762.24 crore while earnings per share for the quarter stood at Rs2.39.

The performance is commendable considering the challenging business environment, the slowdown in private consumption expenditure and a steep hike in excise duty on cigarettes announced in the current budget, the company said in a release.

ITC's revenue from FMCG business increased by 10.56 per cent to Rs5,282.05 crore in the April-June 2013 quarter as against Rs4,777.29 crore in the corresponding quarter of the previous financial year.

Revenue from cigarettes increased by 7.05 per cent to Rs3,537.39 crore while revenue from other businesses increased by 18.43 per cent to Rs1,744.66 crore.

"The cigarette industry in India continues to be impacted by a discriminatory taxation. Steep increases in excise duty on cigarettes for the second year in succession and the arbitrary increases in Value Added Tax (VAT) on cigarettes by some states during the quarter have exacerbated the situation," ITC said.

The company's non-cigarette FMCG segment improved profitability amid a slowdown in private consumption expenditure, ITC said.

"The company's branded packaged foods businesses posted robust growth in revenues and enhanced market standing across categories during the quarter," it added.

Others in FMCG business include packaged foods (bakery and confectionery foods, snack foods, staples, spices and ready to eat foods), apparel, education and stationery products, personal care products, safety matches and incense sticks.

Revenue from non-FMCG business, which includes hotels, agri business and paperboard, paper and packaging, increased by 20.77 per cent to Rs3,601.98 crore.

ITC also reported a 7.53 per cent growth in revenue from hotel segment at Rs249.86 crore despite weak global macroeconomic environment and high levels of room inventory in key domestic markets.

"A weak macroeconomic scenario in major source markets and in India, coupled with high room inventory levels in key domestic cities resulted in a relatively weak pricing scenario leading to a muted growth in segment revenues during the quarter," the company said.

Total expenses of the company increased by 6.81 per cent to Rs4,834.69 crore from Rs4,526.12 crore in the year-ago quarter.