Financial Daily from THE HINDU group of publications
Saturday, Jan 19, 2002
Corporate Results - Cigarettes
ITC net sales up 8 pc in Q3
KOLKATA, Jan. 18
ITC Ltd has recorded a 17 per cent increase in its net profit for the quarter ended December 31, 2001 at Rs 259.23 crore against Rs 221.60 crore for the corresponding period of the last financial year.
Nine-month post-tax profits have registered an increase of 22.5 per cent at Rs 893.51 crore against the Rs 729.19 crore achieved for the same period of the last financial year. The PBT for the quarter is placed at Rs 416.49 crore (Rs 357.29 crore) and for the nine-month at Rs 1,368.42 crore (Rs 1,166.14 crore).
The gross income, comprising segment revenue and other income, in Q3 is at Rs 2,420.33 crore (Rs 2,261.92 crore). Net sales turnover rose 8 per cent at Rs 1,195.27 crore (Rs 1,107.97 crore). Total expenditure climbed to Rs 754.72 crore against Rs 717.10 crore.
Higher provision for taxation at Rs 157.26 crore (Rs 135.69 crore), according to the company's note, included the impact of deferred taxation, both for the current and the previous year.
According to the company spokesperson, the interest cost for the quarter is lower at Rs 11.64 crore (Rs 25.07 crore) as a result of debt reduction. Cost control has helped absorb the impact of start-up costs of new businesses like Lifestyle Retailing, Greetings Cards and Packaged Foods.
The steep worldwide decline in business and leisure travel, combined with the gestation of new properties, had considerably impacted the results of the hotels business. The capital employed in the hotels segment is Rs 740 crore which includes Rs 641 crore relating to the recently opened properties, namely ITC One in New Delhi and ITC Grand Maratha in Mumbai as well as capital work in progress in respect of properties under construction.
While domestic cigarette volumes remain under pressure owing to the steep hike in excise duties imposed in the last Budget, it is stated that the company's focus on investment in brands slowed the drop in domestic cigarette volumes during the quarter.
The quarter witnessed the launch of a new product, Wills Navy Cut lights, as part of a strategy to constantly upgrade the product range.
The negative show by the agri-business segment, according to the company notes, reflects the impact of the crop holiday declared by the Tobacco Board in Andhra Pradesh.
While the exports of agri commodities other than leaf tobacco grew by 24 per cent in rupee terms during the quarter, segment results were adversely affected by the slump in prices of marine products to their lowest levels in the last 10 years, owing to the continuous downturn in the US and Japan.
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