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Quarterly Results

 

Click here to download the Financial Results

Standalone Unaudited Financial Results
for the Quarter and Six Months ended 30th September, 2016

(Rs. in Crores)
Particulars   3
Months 
ended
30.09.2016
Corresponding
3 Months
ended
30.09.2015
Preceding
3 Months
ended
30.06.2016
6 Months
ended
30.09.2016
6
Months
ended
30.09.2015
Twelve
Months
 ended
31.03.2016
    (Unaudited)* (Unaudited)* (Unaudited)* (Unaudited)* (Unaudited)* (Unaudited)*
INCOME FROM OPERATIONS              
a) REVENUE
FROM
OPERATIONS
1 13491.37 12511.76 13156.68 26648.05 24662.24 51582.45
b) OTHER
OPERATING
INCOME
2 125.24 99.53 96.38 221.62 181.70 362.12
TOTAL
INCOME FROM
OPERATIONS
(1+2)
3 13616.61 12611.29 13253.06 26869.67 24843.94 51944.57
EXPENSES              
a) Cost of materials consumed   3000.10 2691.47 2880.04 5880.14 5260.55 11054.75
b) Purchases
of stock-in-trade
  501.11 438.01 1004.84 1505.95 1067.03 2591.80
c) Changes
in inventories
of finished
goods,
work-in-
progress
and stock-in-
trade
  170.14 (16.00) 360.70 530.84 527.19 (196.55)
d) Excise duty   3955.90 3812.40 3199.02 7154.92 6885.03 15361.90
e) Employee benefits expense   600.33 578.05 700.31 1300.64 1205.51 2328.27
f) Depreciation
and amortisation
expense
  268.44 258.20 261.25 529.69 515.81 1031.93
g) Other
expenses
  1759.00 1724.64 1581.92 3340.92 3263.68 7086.46
TOTAL
EXPENSES
4 10255.02 9486.77 9988.08 20243.10 18724.80 39258.56
PROFIT FROM
OPERATIONS
BEFORE OTHER
INCOME AND
FINANCE COSTS
(3-4)
5 3361.59 3124.52 3264.98 6626.57 6119.14 12686.01
OTHER INCOME 6 475.35 392.57 420.52 895.87 749.06 1769.26
PROFIT FROM
ORDINARY
ACTIVITIES
BEFORE
FINANCE
COSTS (5+6)
7 3836.94 3517.09 3685.50 7522.44 6868.20 14455.27
FINANCE
COSTS
8 10.72 10.31 10.10 20.82 20.77 49.13
PROFIT FROM
ORDINARY
ACTIVITIES
BEFORE
TAX  (7-8)
9 3826.22 3506.78 3675.40 7501.62 6847.43 14406.14
TAX EXPENSE 10 1326.19 1244.28 1290.73 2616.92 2418.84 5094.88
NET PROFIT
FOR THE
PERIOD (9-10)
11 2500.03 2262.50 2384.67 4884.70 4428.59 9311.26
OTHER COMPREHENSIVE INCOME
(NET OF TAX)
12 (25.19) (16.01) 63.57 38.38 (100.78) (66.58)
TOTAL
COMPREHENSIVE INCOME
(11+12)
13 2474.84 2246.49 2448.24 4923.08 4327.81 9244.68
PAID UP
EQUITY
SHARE
CAPITAL
14 1211.16 802.65 805.33 1211.16 802.65 804.72
(Ordinary
shares of
Re. 1/- each)
             
RESERVES
EXCLUDING
REVALUATION
RESERVES
15           40834.60
EARNINGS
PER SHARE
(of Re.
1/- each) (not annualised):
16            
(a) Basic
(Rs.)
  2.07 1.88 1.97 4.04 3.68 7.72
(b) Diluted
  (Rs.)
  2.04 1.87 1.96 3.99 3.66 7.68
'* The financial results of the Company have been prepared in accordance with Indian Accounting Standards (Ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015 as amended by the Companies (Indian Accounting Standards) (Amendment) Rules, 2016. The Company adopted Ind AS from 1st April, 2016, and accordingly, these financial results (including for all the periods presented in accordance with Ind AS 101 - First-time Adoption of Indian Accounting Standards) and statement of assets and liabilities have been prepared in accordance with the recognition and measurement principles in Ind AS 34 - Interim Financial Reporting, prescribed under Section 133 of the Companies Act, 2013 read with the relevant rules issued thereunder and the other accounting principles generally accepted in India.

Notes :

1. The Unaudited Standalone Financial Results, Segment Results and Statement of Assets and Liabilities were reviewed by the Audit Committee and approved at the meeting of the Board of Directors of the Company held on 26th October, 2016.
2. The launch and rollout costs of the Company's brands 'Fiama', 'Vivel', 'Superia', 'Engage', 'Savlon' and 'Shower to Shower' covering the range of personal care products of soaps, face washes, shower gels, skin care, deodorants, handwash and ayurvedic talc, and the continuing significant brand building costs of the Foods businesses are reflected under 'Other expenses' stated above and in Segment Results under 'FMCG-Others'.
3. During the quarter, 4,05,82,45,380 Ordinary Shares of ` 1/- each were issued and allotted, as follows:-

a) 402,66,57,100 Ordinary Shares of Re 1/- each, as fully paid-up Bonus Shares in the proportion of 1 (One) Bonus Share of Re 1/- each for every existing 2 (Two) Ordinary Shares of Re.1/- each. Pursuant to the issue and allotment of Bonus Shares, the earnings per share (Basic and Diluted) have been adjusted for all the periods stated above.

b) 3,15,88,280 Ordinary Shares of Re 1/- each were issued and allotted under the Company’s Employee Stock Option Schemes.

Consequently, the issued and paid-up Share Capital of the Company as on 30th September, 2016 stands increased to Rs1211,15,59,581/-.

4. A. Reconciliation of the standalone financial results to those reported under previous Generally Accepted Accounting Principles (GAAP) are summarised as follows:
 
Particulars Notes 3 months
ended
30.09.2015
6 months
ended
30.09.2015
Twelve months ended
31.03.2016
Profit After Tax as reported under previous GAAP   2431.25 4696.69 9844.71
Impact of measuring investments at Fair Value through Profit or Loss (FVTPL) (ii), (iii) (54.04) (36.00) (115.78)
Impact of measuring derivative financial instruments, other than those designated as cash flow hedges, at fair value (iv) (2.22) (1.79) 8.29
Impact of recognising the cost of the employee stock option scheme at fair value  (i) (c) (141.11) (255.16) (498.60)
Reclassification of actuarial gains / losses, arising in respect of employee benefit schemes, to Other Comprehensive Income (OCI)    14.00 18.00 53.84
Tax Adjustments   14.62 6.85 18.80
Profit After Tax as reported under Ind AS   2262.50 4428.59 9311.26
Other Comprehensive Income (net of tax)   (16.01) (100.78) (66.58)
Total Comprehensive Income as reported under Ind AS   2246.49 4327.81 9244.68
  B. Reconciliation of equity as reported under previous GAAP is summarised as follows:
 
Particulars Notes As at 31.03.2016
(end of last period presented
under previous GAAP)
Equity as reported under previous GAAP   32929.00
Dividends (including tax thereon) (v) 8232.60
Impact of measuring derivative financial instruments, not being cash flow hedges, at fair value (net of tax) (iv) 8.06
Impact of measuring investments at Fair Value through Profit or Loss (FVTPL) or OCI (net of tax) (ii), (iii) 414.62
Impact of recognising the cost of the employee stock option scheme in respect of employees of group companies (i) (c) 55.04
Equity as reported under Ind AS   41639.32
Comprising:  
Paid up equity share capital   804.72
Reserves   40834.60
i) Exemptions applied at transition
  Ind AS 101 (First-time Adoption of Indian Accounting Standards) provides a suitable starting point for accounting in accordance with Ind AS and is required to be mandatorily followed by first-time adopters. Ind AS 101 allows first-time adopters exemptions from the retrospective application of certain requirements under Ind AS. The Company has applied the following exemptions in its standalone financial results:
  a. Property, Plant and Equipment were carried in the statement of financial position prepared under previous GAAP as at 31st March, 2015. The Company has elected to regard such carrying amount as deemed cost at the date of transition i.e. 1st April, 2015.
  b. Under previous GAAP, investment in subsidiaries, joint ventures and associates were stated at cost and provisions made to recognise the decline, other than temporary. Under Ind AS, the Company has elected to regard such carrying amount as at 31st March, 2015 as deemed cost at the date of transition.
 

c. As per the previous GAAP, the cost of ITC Employee Stock Option Scheme (ITC ESOS) [equity-settled] was recognised using the intrinsic value method. Under this method, no expenses were recognised in the statement of profit and loss as the fair value of shares on the date of grant equalled the exercise price. Under Ind AS, the cost of ITC ESOS is recognised based on the fair value of the options as on the grant date. In terms of the exemptions, the fair value of unvested options as at the date of transition have been accounted for as part of reserves. The fair value of options vesting after the transition date have been recognised in profit or loss.

The cost of ITC ESOS applicable to employees of group companies, net of reimbursements, have been considered as capital contribution.

ii) Under previous GAAP, current investments were stated at lower of cost and fair value. Under Ind AS, these financial assets have been classified as FVTPL on the date of transition and fair value changes after the date of transition has been recognised in profit or loss.
iii) Under previous GAAP, non current Investments were stated at cost. Where applicable, provision was made to recognise a decline, other than temporary, in valuation of such Investments. Under Ind AS, financial assets in equity instruments [other than those in (i) (b)] have been classified as Fair Value through Other Comprehensive Income (FVTOCI) through an irrevocable election at the date of transition.
iv) Under previous GAAP, the net mark to market losses on derivative financial instruments, other than those designated as cash flow hedges, as at the Balance Sheet date, were recognized in profit or loss, and the net gains, if any, were ignored. Under Ind AS, such derivative financial instruments are to be recognised at fair value and the movement is recognised in profit or loss.
v) Under previous GAAP, dividend payable is recognised as a liability in the period to which it relates. Under Ind AS, dividends to shareholders are recognised when declared by the members in a general meeting.
5. This statement is as per Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Limited Review

The Limited Review, as required under Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 has been completed and the related Report forwarded to the Stock Exchanges. This Report does not have any impact on the above 'Results and Notes' for the Quarter ended 30th September, 2016 which needs to be explained.

Statement of Assets and Liabilities

(Rs. in Crores)
STANDALONE
Particulars As at current half
year end
30.09.2016
As at
previous year
end 31.03.2016
(Unaudited) (Unaudited)
A ASSETS    
1 NON-CURRENT ASSETS    
  (a) Property, Plant and Equipment 13599.06 13591.96
  (b) Capital work-in-progress 3125.76 2388.42
  (c) Other Intangible assets 361.86 387.76
  (d) Intangible assets under development 43.18 30.75
  (e) Financial Assets    
  (i) Investments 6427.74 6856.51
  (ii) Loans 7.00 8.12
  (iii) Others 103.31 1031.18
  (f) Other non-current assets 2569.46 2474.72
  Non-Current Assets 26237.37 26769.42
2 CURRENT ASSETS    
  (a) Inventories 8276.96 8519.82
  (b) Financial Assets    
  (i) Investments 8940.91 6471.34
  (ii) Trade receivables 2076.14 1686.35
  (iii) Cash and cash equivalents 21.16 75.79
  (iv) Other Bank Balances 3165.90 5563.41
  (v) Loans 3.85 3.85
  (vi) Others 341.56 407.22
  (c) Other current assets 588.41 506.15
  Current Assets 23414.89 23233.93
  TOTAL ASSETS 49652.26 50003.35
B EQUITY AND LIABILITIES    
  EQUITY    
  (a) Equity Share capital 1211.16 804.72
  (b) Other Equity 38016.99 40834.60
  Shareholders' Funds 39228.15 41639.32
  LIABILITIES    
1 NON-CURRENT LIABILITIES    
  (a) Financial Liabilities    
  (i)  Borrowings 24.04                        25.83
  (ii) Other financial liabilities 8.77                        15.13
  (b) Provisions 136.36                      112.19
  (c) Deferred tax liabilities (Net) 1963.63 1856.61
  (d) Other non-current liabilities 2.72                             -  
  Non-Current Liabilities 2135.52 2009.76
2 CURRENT LIABILITIES    
  (a) Financial Liabilities    
  (i)  Borrowings 517.03 3.60
  (ii) Trade payables 2240.98 2228.01
  (iii) Other financial liabilities 713.84 594.71
  (b) Other current liabilities 4298.96 3441.96
  (c) Provisions 21.65 57.60
  (d) Current Tax Liabilities (Net) 496.13 28.39
  Current Liabilities 8288.59 6354.27
  TOTAL EQUITY AND LIABILITIES 49652.26 50003.35

Unaudited Segment-wise Revenue, Results, Assets and Liabilities
for the Quarter and Six Months ended 30th September, 2016

(Rs. in Crores)
    STANDALONE
  Particulars 3 Months
ended
30.09.2016
Corresponding
3 Months
ended
30.09.2015
Preceding
3 Months
ended
30.06.2016
6 Months
ended
30.09.2016
6 Months
ended
30.09.2015
Twelve
Months
ended
31.03.2016
    (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited)
1. Segment Revenue            
  a) FMCG
- Cigarettes 
8528.47 7963.10 8230.60 16759.07 15696.52 32348.29
  - Others      2671.66 2357.98 2385.15 5056.81 4535.48 9731.17
  Total FMCG 11200.13 10321.08 10615.75 21815.88 20232.00 42079.46
  b) Hotels 297.34 290.06 287.36 584.70 577.89 1286.17
  c) Agri Business         1880.06 1843.74 2794.08 4674.14 4169.10 7456.88
  d) Paperboards, Paper & Packaging  1331.41 1330.98 1322.90 2654.31 2675.00 5327.70
  Total  14708.94 13785.86 15020.09 29729.03 27653.99 56150.21
  Less :  Inter-segment revenue  1217.57 1274.10 1863.41 3080.98 2991.75 4567.76
Revenue from operations 13491.37 12511.76 13156.68 26648.05 24662.24 51582.45
2. Segment Results            
  a) FMCG
- Cigarettes 
3216.88 2968.94 3004.58 6221.46 5750.04 11752.43
  - Others (3.26) (11.10) (4.52) (7.78) (19.07) 70.51
  Total FMCG 3213.62 2957.84 3000.06 6213.68 5730.97 11822.94
  b) Hotels  0.65 (5.54) 1.22 1.87 (12.79) 55.69
  c) Agri Business 296.96 293.92 237.31 534.27 527.79 933.03
  d) Paperboards, Paper & Packaging 231.95 209.25 247.69 479.64 463.69 907.62
  Total 3743.18 3455.47 3486.28 7229.46 6709.66 13719.28
  Less : i) Finance Costs 10.72 10.31 10.10 20.82 20.77 49.13
  ii) Other un-allocable (income) net of un-allocable expenditure [Note (i)] (93.76) (61.62) (199.22) (292.98) (158.54) (735.99)
Profit Before Tax 3826.22 3506.78 3675.40 7501.62 6847.43 14406.14
3. Assets            
  a) FMCG - Cigarettes 7816.59 7915.97 7616.48 7816.59 7915.97 7946.13
  - Others 6825.79 5909.09 6775.25 6825.79 5909.09 6059.49
  Total FMCG 14642.38 13825.06 14391.73 14642.38 13825.06 14005.62
  b) Hotels  [Note (ii)] 4930.88 4774.84 4868.10 4930.88 4774.84 4820.29
  c) Agri Business 2817.81 2694.31 3182.51 2817.81 2694.31 2968.39
  d) Paperboards, Paper & Packaging 6242.72 5934.79 6143.62 6242.72 5934.79 6031.00
  Total  28633.79 27229.00 28585.96 28633.79 27229.00 27825.30
  Unallocated Corporate Assets 21018.47 17991.87 25244.70 21018.47 17991.87 22178.05
Total Assets 49652.26 45220.87 53830.66 49652.26 45220.87 50003.35
4. Liabilities            
  a) FMCG
- Cigarettes **
2858.54 2671.54 2469.98 2858.54 2671.54 2644.39
  - Others 1333.26 1134.56 1308.06 1333.26 1134.56 1179.77
  Total FMCG 4191.80 3806.10 3778.04 4191.80 3806.10 3824.16
  b) Hotels 383.62 354.00 361.52 383.62 354.00 345.39
  c) Agri Business 1089.73 997.36 825.02 1089.73 997.36 610.35
  d) Paperboards, Paper & Packaging 583.39 512.26 545.12 583.39 512.26 510.68
  Total  6248.54 5669.72 5509.70 6248.54 5669.72 5290.58
  Unallocated Corporate Liabilities 4175.57 3511.28 3993.05 4175.57 3511.28 3073.45
Total Liabilities 10424.11 9181.00 9502.75 10424.11 9181.00 8364.03

** Segment Liabilities of FMCG-Cigarettes is before considering Rs. 661.60 Crores (30.09.2015 - Rs. 640.14 Crores ; 30.06.2016 - Rs. 656.91 Crores ; 31.03.2016 - Rs. 651.54 Crores) in respect of disputed Taxes, the recovery of which has been stayed or where States' appeals are pending before Courts. These have been included under 'Unallocated Corporate Liabilities'.

Note (i) : As stock options are granted under ITC ESOS to align the interests of employees with those of shareholders and also to attract and retain talent for the enterprise as a whole, the option value of ITC ESOS do not form part of the segment performance reviewed by the Corporate Management Committee. Also refer note 4 (i) (c) to the financial results.

Note (ii) : Includes Rs. 541.21 Crores (30.09.2015 - Rs. 541.21 Crores ; 30.06.2016 - Rs. 541.21 Crores ; 31.03.2016 - Rs. 541.21 Crores) towards payment to IFCI Limited and applicable stamp duty for purchase of a five star hotel resort in Goa operating under the name Park Hyatt Goa Resort & Spa and IFCI Limited issued required sale certificate in favour of the Company. The erstwhile owners of the property thereafter challenged the sale. By its judgement dated 23.03.2016, the Bombay High Court set aside the sale and directed IFCI Limited to refund the sale consideration to the Company. The Company and IFCI Limited have approached the Hon'ble Supreme Court against the High Court judgement. The Hon'ble Supreme Court by its interim order dated 22.04.2016 has issued notice in the matter, ordered status quo and directed that the sale consideration shall remain with IFCI Limited. The matter is pending before the Hon'ble Supreme Court.

Notes :

(1)

The Company's corporate strategy aims at creating multiple drivers of growth anchored on its core competencies. The Company is currently focused on four business groups : FMCG, Hotels, Paperboards, Paper & Packaging and Agri Business. The Company's organisational structure and governance processes are designed to support effective management of multiple businesses while retaining focus on each one of them.

The Operating Segments have been reported in a manner consistent with the internal reporting provided to the Corporate Management Committee, which is the Chief Operating Decision Maker.

(2) The business groups comprise the following :
FMCG : Cigarettes - Cigarettes, Cigars etc.
  : Others - Branded Packaged Foods Businesses (Staples, Snacks and Meals; Dairy and Beverages; Confections); Apparel; Education and Stationery Products; Personal Care Products; Safety Matches and Agarbattis.
Hotels - Hoteliering.
Paperboards, Paper & Packaging - Paperboards, Paper including Specialty Paper & Packaging including Flexibles.
Agri Business - Agri commodities such as soya, spices, coffee and leaf tobacco.
(3) Segment results of 'FMCG : Others' are after considering significant business development, brand building and gestation costs of Branded Packaged Foods businesses and Personal Care Products business.
(4) The Company's Agri Business markets agri commodities in the export and domestic markets; supplies agri raw materials to the Branded Packaged Foods Businesses and sources leaf tobacco for the Cigarettes Business.
   
Registered Office :
Virginia House, 37 J.L. Nehru Road,
Kolkata 700 071, India

Dated : 26th October, 2016
Place : Gurgaon, India

For and on behalf of the Board



Director& Chief Financial Officer Chairman

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Financial Results June 2016
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