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ITC profit up 18%
The Hindu Business Line - 24 May 2014

ITC Ltd on Friday reported a little over 18 per cent rise in net profit to approximately Rs. 2,278 crore during the January-March 2014 quarter, against the corresponding period in the previous year.

Sequentially, profits have declined by 4.48 per cent from Rs. 2,385 crore in October-December 2013.

The higher profit came from a little less than 12 per cent rise in net income from operations to nearly Rs. 9,239 crore compared to last year.

Net profit for the entire year stood at approximately Rs. 8,785 crore, up by over 18 per cent.

ITC declared a dividend of Rs. 6 per share of face value Rs. 1 each for 2013-14, up from last year’s dividend of Rs. 5.25 per share.

Profit churner

As usual, cigarette has been a profit churner for the company, contributing nearly 79 per cent of the pre-tax profit for the quarter. This is irrespective of year-on-year decline in volume sales.

However, profitability got an additional boost with non-cigarette FMCG business recording its second quarterly profit.

The business came back into the black in the third quarter and booked its maiden annual profit (before interest and tax) of Rs. 22 crore in this fiscal. ITC posted nearly Rs. 81 crore loss in non-cigarette FMCG segment in 2012-13.

Hotels posted a massive 46 per cent growth in pre-tax profits in the January-March quarter as against the same period last year. But, sequentially, pre-tax profits declined by Rs. 2 crore.

According to the company, ITC earns the highest operating margin in the Indian hotels industry. Agri business recorded improved profitability in the fourth quarter.

But profits of paperboards, paper and packaging segment remained flat.

According to analysts from Angel Broking and Religare Capital Markets, the results are in line with expectations.