ITC profit rises 9% to ₹3,797 cr in Q4



FMCG major ITC Ltd reported an over 9 per cent jump in standalone net profit to ₹3,797 crore for the quarter ended March 31, 2020, as against ₹3,482 crore it reported in the year-ago-period.

During the period under review, revenue from operations stood at ₹11,300 crore, a decline of 6 per cent YoY.

For the full fiscal, post-tax profit (standalone) saw an over 21 per cent jump to ₹15,136 crore (₹12,464 crore). Revenue from operations stood at ₹46,323 crore, a 2.4 per cent increase over the ₹45,222 crore it reported in the corresponding fiscal (FY19).

During the quarter, the company’s current tax liability was lower at ₹853 crore, as against ₹1,574 core in Q4 FY19. Tax expense for the quarter includes a credit of ₹340 crore, it said in a note to its profit and loss accounts.

Businesses such as hotels and hospitality were hit due to the pandemic and the lockdown. Similarly, the non-cigarette FMCG business saw a hit due to stationary and education getting impacted.

“Prior to the outbreak of the pandemic, the FMCG-others segment was on track to register double-digit revenue growth for the fourth quarter, on a comparable basis,” the company said in a statement, adding that “just as the business environment was showing signs of an incipient recovery in the beginning of the fourth quarter, the onset of Covid-19 pandemic, changed the situation”.
Segment-wise performance

In the FMCG-others segment, the company witnessed a 2.8 per cent decline in revenue from operations for Q4FY20 (January –March), YoY to ₹3,184 crore while in the hotel's segment revenues for the quarter dipped by 9 per cent to Rs 466 crore, YoY.

The company further added that in the initial stages, the contagion had a significant impact on the hotels and education and stationery products businesses as it coincided with the peak period and the onset of the school season, respectively. Demand in the education and stationery products continued to be subdued pending resumption of the educational institutes.

“A strong momentum has been witnessed in essential consumer goods and the company has ramped up capacity to service surge in demand across categories,” ITC said in the statement.

Meanwhile, Edelweiss Securities in a report maintained that in Q4 FY20, the cigarettes segment declined 6.5 per cent YoY, with an 396bps YoY EBIT margin compression. Cigarette revenues for the quarter stood at ₹5,131 crore (₹5,486 crore). Cigarette volumes have seen a 10 per cent decline YoY, in January-March period, the report mentioned.

Other major verticals like the Agribusiness segment saw a 10.2 per cent decline in revenues, YoY in Q4 FY20; while the Paperboards, paper & packaging segment declined 5.1 per cent YoY.

The board has recommended a dividend of ₹10.15 per share for the year ended March 31. Total cash outflow in this regard will be ₹12,476.61 crore.
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