Non-cigarette revenue boost for ITC

FMCG, paper and hotels major ITC Ltd today reported a 20 per cent rise in profit after tax at Rs 783 crore in the first quarter ending June 30, 2007, on the back of 16 per cent rise in sales at Rs 3,325 crore in the quarter.

ITC Chairman Y C Deveshwar told shareholders at the annual general meeting here today that sales was driven by an 18 per cent rise in non-cigarette revenues at a time when cigarette revenues and operations were under intense pressure owing to the imposition of value added tax and other levies by states.

He indicated that strong growth in non-cigarette revenues was expected to sustain performance, which he described as "satisfactory".

However, cigarettes accounted for most of the profits before tax of the company in the quarter, while profit before tax grew only marginally for the other divisions and dipped for the paper division despite an increase in sales. The company's other FMCG products saw a sharp rise in sales.

The other income in Q1 of this financial year was at Rs 101 crore, against Rs 84 crore in Q1 of the last financial. The company's cigarette sales in Q1 was at Rs 3,441 crore and profit before tax for the segment at Rs 939 crore against a revenue of Rs 3,159 crore and PBT of Rs 815 crore in Q1 of the last financial year.

Other FMCG sales (comprising foods, garments, cards, stationery, agarbattis and matches) in Q1 of this fiscal was at Rs 542 crore, with the segment reporting a loss of Rs 44 crore, against a revenue of Rs 359 crore and a loss of Rs 58 crore in Q1 of the last financial year.

Hotel revenues in Q1 FY07 was at Rs 221 crore with profit before tax for the segment at Rs 64 crore, against a revenue of Rs 198 crore and PBT of Rs 57 crore in Q1 of the previous year.

The agribusiness division revenues in Q1 was Rs 1,418 crore and the profit before tax for the segment was Rs 54 crore, against a revenue of Rs 1,111 crore and PBT of Rs 47 crore in Q1 of the last financial year.

The paperboards, paper and packaging division revenue in Q1 of this fiscal was Rs 526 crore with profit before tax for the segment dipping to Rs 86 crore, against a revenue of Rs 501 crore and PBT of Rs 104 crore in the last financial year.

Addressing the media in the evening on Friday, Deveshwar said retail property prices in urban clusters were way too high and the company would rather wait prices came down to a level where the right quality of goods and services could be delivered to the middle-class urban consumer in a sustainable manner.