ITC Ltd reported 17 per cent higher post-tax profit for the third quarter of the current financial year at Rs 259 crore against Rs 221 crore in the third quarter of the last financial year. Gross income rose 8 per cent to Rs 2,420 crore (Rs 2,261 crore in the third quarter of the last financial year) while net income was also higher at Rs 1222 crore (Rs 1136 crore).
The results improved though domestic cigarette sales continued to be under pressure owing to higher excise duties and higher contraband volumes in the market. The packaging factory at Tiruvottiyur continued to be shut owing to a strike.
Profit figures would have been higher had the company not invested substantially in start-up costs of the lifestyle retailing and greetings cards businesses. The lifestyle retailing business opened seven new stores in the third quarter, taking its total number of stores to 29, while the 'Kitchens of India' range launched several packaged food items.
But cigarettes continued to be ITC's lifeline, accounting for Rs 2,036 crore sales in the third quarter and Rs 426 crore in profit before tax (PBT). The garments, greetings cards and packaged foods business accounted for Rs 9 crore in sales and lost Rs 18 crore owing to start-up costs.
The hotels division reported sales of Rs 39 crore but lost Rs 1.6 crore owing to slowdown in the industry, while agri business reported losses of Rs 3 crore on sales of Rs 333 crore. Gross income from paper and packaging was Rs 112 crore, with profit before tax at Rs 20 crore.
ITC had reported 29 per cent higher net profit in the second quarter of the current financial year against the last one, with gross income rising only 8.6 per cent from Rs 2,161 crore to Rs 2,384 crore in the second quarter.
For the nine months ended December 2001, ITC's gross income rose to Rs 7,020 crore (against Rs 6,567 crore in nine months ending December 2000) while net income was also higher at Rs 3,464 crore (Rs 3,201 crore). Net profit in the nine months ended December 2001 was also higher at Rs 893 crore against Rs 729 crore in the nine months ending December 2000.
ITC's income in the April September 2001 first half in the current financial year grew 6.8 per cent from Rs 4305 crore to Rs 4600 crore, while net profit soared 25 per cent to Rs 634 crore from Rs 507 crore. Interest cost declined from Rs 47 crore to Rs 33 crore in the first half.
The proposed merger with ITC Bhadrachalam Paperboards Ltd already approved by members would substantially raise the revenue and profit figures of the company, though overall margins were likely to be lower owing to lower margins in the paperboards business compared to the cigarettes business.
