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ITC Bhadrachalam Q2 net up by 62 per cent
12 Oct 2001

ITC Bhadrachalam posted impressive results for the quarter ended September 30, 2001 with a substatial growth of 62 per cent in the Profit after Tax to Rs. 11 crores. Pre-tax Profit for the quarter at Rs. 17.8 crores represents a growth of 65 per cent compared to the same period last year. Profits from operations (excluding the extraordinary income of Rs 4.05 crores earned in the first half of the previous financial year) for the six month period till 30th September grew by 48 per cent, testifying to the growing international competitiveness of the Company. Current levels of operations generate cash of over Rs. 9 crores per month.

Despite difficult trading conditions and the impact of the fire in the mill, such results were achieved because of the focus on high-end value added paperboards. World-class products such as Cyber XL and Indolux for the packaging segment, and Pearl Graphik and Safire Graphik for the graphic segment are already leaders in the market. The Company continues to enhance value for its customers through product development. The resultant improvement in market standing is expected to further enrich the product mix substantially, especially since the demand for paperboards in the value-added segment is forecast to grow at a much faster rate of over 20 per cent per annum, against 8 per cent for conventional paperboards.

Strategic cost management initiatives, encompassing the entire value chain from fibre to finished product, led to an all-round enhancement in cost efficiencies, including financing costs. The expansion and modernisation of the pulp mill at an outlay of Rs. 220 crores is progressing on schedule. This capex programme is an integral part of the Company's fibre strategy aimed at substantially improving cost competitiveness, besides enhancing product quality and enabling scaling up of the mill. The project, on completion, would also constitute the finest environmental standard by far among paperboard mills in India.

The financial results for the period ended September 30, 2001 were approved by the ITC Bhadrachalam Board of Directors at its meeting in Kolkata on October 12, 2001.