Cigarettes Boost ITC’s Second Quarter Performance
ITC missed estimates in the second quarter, but cigarette sales increased.
ITC Ltd.’s profit in the July to September quarter rose 10.5 percent as cigarette sales increased 7 percent.
Net profit rose to Rs 2,500 crore from Rs 2,262.5 crore in the same quarter last year, according to financial results posted on the exchanges. The consensus estimate of analysts tracked by Bloomberg had pegged the profit at Rs 2,672 crore.
Revenue rose 7.8 percent to Rs 13,491 crore from Rs 12,512 crore. If excise duty is removed, revenue grew 9.6 percent to Rs 9,535.5 crore. Other income stood at Rs 475.4 crore.
Earnings before interest, tax, depreciation and amortisation rose 7.3 percent to Rs 3,630 crore while EBITDA margin fell to 37.57 percent from 38.44 percent earlier.
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Segment-Wise Performance
The cigarette division delivered a strong performance with sales increasing 7.1 percent to Rs 8,528.5 crore. Margins expanded to 37.7 percent from 37.3 percent last year, and 36.5 percent in the quarter ended June 2016.
ITC’s fast moving consumer goods sales grew 13.1 percent to Rs 2,671.7 crore, on a year-on-year basis. The division’s operating loss narrowed to Rs 3.3 crore from Rs 11.1 crore.
Hotel business’ revenue increased 2.5 percent, while agri-business sales rose 2 percent. The paper and paper-boards segment sales remained stagnant on a year-on-year basis.
ITC shares turned positive after trading in the red for most of the day. The stock traded 0.44 percent higher at Rs 239.8 as of 2:55 p.m.