ITC Q4 FY16 net up 5.7% at Rs2,495 crore; declares 1:2 bonus

Consumer products, hotels and agriculture group ITC Limited has reported a 5.7-per cent year-on-year increase in its fiscal fourth quarter net profit at Rs2,495 crore against a net profit of Rs2,361 crore in the year-ago quarter.

ITC said its gross standalone revenues stood at Rs10,062.36 crore, up 10.5.8 per cent from Rs9,102.66 crore in the year-ago quarter. Pre-tax profit for the quarter was up 14.4 per cent.

For the full year, gross revenue crossed Rs50,000 crore. Excluding agri-commodity exports, gross revenue was up 6.4 per cent over the previous year, the company stated in a release. Pre-tax profit for the year was up 6.9 per cent.

The board of directors of ITC Ltd has declared a total dividend of Rs8.50 per share, including a special dividend of Rs2.00 per share for FY16 and issuance of 1 bonus share for every 2 existing ordinary shares held by members on record date.

For the full year, the company said its FMCG-cigarettes segment continued to be impacted by severe pressure on the legal cigarette industry volumes even as illegal trade grew unabated. However the FMCG-others segment recorded revenue growth of 7.7 per cent amidst sluggish demand conditions and price deflationary environment.

In the hotels segment, revenue was up 8.4 per cent aided by healthy growth in occupancy and food and beverage revenue but there was some impact from the gestation costs of ITC Grand Bharat and business disruption caused by heavy rains in Chennai during November-December 2015.

In the agribusiness segment, full year revenue was impacted by lack of trading opportunities in wheat, coffee and soya due to higher crop output and steeper currency depreciation in competing origins. Improvement in profitability improvement was driven by superior product mix and higher realisations.

The company said that its paperboards, paper packaging segment was impacted by slowdown in the FMCG and cigarette industry, zero duty imports under free trade agreement with ASEAN countries and cheap imports from China.

The company attributed the increase in effective tax rate - up 280 bps to 34.2 per cent - largely due to increase in surcharge, change in income tax provisions relating to holding period for investments in debt oriented mutual funds to qualify as long-term capital asset, eligibility criteria for claiming investment allowance etc.

For the quarter ended 31 March 2016, the company said improvement in performance was driven by improved realisations, margin expansion, benign input costs and favourable base effect.

However, revenue growth in the FMCG-others segment was impacted due to persistently sluggish demand environment, price deflationary scenario and trade pipeline synchronisation in the notebooks category.

The company said that year 2015-16 has been a year of significant milestones for ITC Limited because it marks the completion of 20 years since the company embarked upon its corporate strategy of creating multiple drivers of growth and focusing on Triple Bottom Line performance.