ITC's net profit increases in Q1 despite income fall

FMCG major ITC Ltd on Thursday posted an increase of 3.62 percent in its net profit at Rs.2,265.44 crore for the April-June first quarter of fiscal 2015-16 even as its net income fell.

The net profit during the corresponding months of the previous fiscal was Rs.2,186.39 crore.

The company's total income from operations declined by 7.14 percent at Rs.8,587.70 crore against Rs.9,248.29 crore in the year-ago period.

Its cigarettes business, which accounts for the major chunk of its sales, fell nominally by 1.22 percent - contributing Rs.4,149.61 crore against Rs.4,201.06 crore during the first three months of the previous fiscal.

The agri business was the hardest hit as its revenues fell by over 29 percent at Rs.2,325.38 crore against Rs.3296.06 crore during April-June 2014.

Interestingly, profit from this business segment in the review period rose by 15.51 percent at Rs. 233.85 crore against Rs. 202.45 crore in the year-ago period.

However, revenues from the total FMCG business rose by just over three percent at Rs.6320.62 crore. The same during the first quarter of the last fiscal year stood at Rs.6135.67 crore.

Although earnings from its hotels business rose by a healthy 15.74 percent in the review period, the segment continued to be at a loss of Rs.7.25 crore. The segment's losses during April-June last year was registered at Rs.12.09 crore.

The firm was able to cut down its total expenses by nearly 12 percent during the fiscal quarter under consideration. It stood at Rs.5460.02 crore for the present year against Rs.6202.02 crore in the period last year.

Ahead of its Annual General Meeting on July 31 here, shares of the company were trading at Rs.312.10 a piece on the Bombay Stock Exchange in the afternoon trade registering an increase of 2.68 percent.

A.V. Girija Kumar, upon completion of his term has ceased to be a Non-Executive Director of the firm this month onwards.