FMCG major ITC Ltd on Wednesday reported a 3.85 per cent year-on-year (y-o-y) growth in its standalone net profit to Rs 3,209.07 crore for the third quarter ended on December 31, 2018 as compared to Rs 3,090.20 crore in the corresponding period last year.
Driven mainly by FMCG, agri business and paperboards, paper and packaging, its gross revenue for the quarter soared to Rs 11,340.15 crore, up by 15.1 per cent from Rs 9,852.74 crore in the corresponding period last year.
However, the company said the profit after tax before considering exceptional items, grew by 13.8 per cent, a 17-quarter high.
"Profit for the period in respect of the quarter and nine months ended on December 31, 2017, before considering exceptional items of Rs 270 crore (post tax), stood at Rs 2,820.20 crore and Rs 8,020.54 crore respectively. Consequently, profit for the period in respect of the quarter and nine months ended on December 31 before considering exceptional items, represents a growth of 13.8 per cent and 12 per cent respectively," it said in a regulatory filing.
Further, the filing said: "Exceptional items in the previous period represent provisions for earlier years in respect of Tamil Nadu entry tax that were written back based on favourable order of the Supreme Court."
In its cigarettes business, the revenue during the quarter under review was at Rs 5,073.38 crore as against Rs 4,629.19 crore in the year-ago period.
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The cigarette major said the "punitive and discriminatory taxation and regulatory regime" continues to exert severe pressure on the domestic legal cigarette industry even as illegal cigarette trade grows unabated.
According to it, the legal cigarette industry, already reeling under the cumulative impact of steep increase in taxation over the previous five years and intense regulatory pressures, was further impacted by a sharp increase of 13 per cent in tax incidence on cigarettes (19 per cent increase for the king-size filter segment) under the GST regime.
"Segment results during the quarter include the impact of escalation in input costs largely on account of consumption of higher cost leaf tobacco crop and increased salience of capsule cigarettes in the sales mix. Despite an extremely challenging operating environment, the business consolidated its leadership position," it said in a statement.
The company's FMCG-Others segment during the quarter posted a revenue of Rs 3,200.98 crore growing year-on-year by 11.5 per cent led by atta, snacks, premium cream biscuits and noodles in the branded packaged foods business, fragrancing products and liquids in the personal care business and others.
"Growth in overall segment revenue was partially impacted by the ongoing restructuring of the lifestyle retailing business and structural changes pertaining to the timing of trade promotions in the matches and 'agarbatti' business," it said.
The company also said the segment Ebitda (earnings before interest, tax, depreciation and amortisation) at Rs 173.38 crore posted strong growth of 42 per cent on the "back of enhanced scale, product mix enrichment and cost management initiatives, notwithstanding increase in input costs, sustained investments in brand building, gestation costs of new categories and start-up costs of new facilities".
In the hotels business, it posted Rs 451.86 crore revenue during the December quarter registering a growth of 12 per cent driven by improvement in average room rate. Operations at the recently commissioned hotels were scaled up, it said.
Its agri-business posted Rs 1,924.61 crore in the quarter. Market opportunities in wheat and oilseeds along with enhanced focus on value-added portfolio, especially coffee, spices and aqua, resulted in robust growth in revenue during the quarter.
"However, in the leaf tobacco vertical, subdued demand for leaf tobacco in international markets, relatively steeper depreciation in currencies of competing origins in recent years along with leaf cost escalation pertaining to Andhra Pradesh 2017 crop continued to weigh on segment results," it said.
In the paperboards, paper and packaging, segment revenue growth of 20.5 per cent was driven by strong demand and capacity augmentation in value added paperboard and decor products.
"Segment results registered a healthy growth of 23.8 per cent driven by product mix enrichment, higher realization, strategic investments in imported pulp substitution, process innovation," it added.
--IANS
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