ITC reports strong growth momentum across operating segments

NEW DELHI: The Board of Directors of ITC will recommend for shareholders' approval, a special dividend of Rs 2.75 per share in addition to the final dividend of Rs 6.75 per share for the financial year ended March 31, 2023.

Together with the interim dividend of Rs 6 per share paid on March 3, total dividend for the financial year ended March 31, 2023 amounts to Rs 15.50 per share (FY22: Rs 11.50 per share).

The company said that strong growth momentum sustained across operating segments.

For Q4, gross revenue (ex-wheat exports) up 16.1 per cent YoY and EBITDA up 18.9 per cent YoY, with EBITDA margin at 36.1 per cent up 385 bps.

ITC reported gross revenue up 6.1 per cent; base quarter included wheat exports that were banned during the current year. PAT was up 21.4 per cent YoY.

For the full year, gross revenue was up 17.6 per cent and EBITDA up 26.5 per cent; EBITDA margin at 34.5 per cent up 240 bps.

12 Hotel properties of the Company have received LEED Zero Carbon certification (first 12 in the world) and 2 hotel properties have received LEED Zero Water certification (first 2 in the world).

ITC sustained its 'AA' rating by MSCI-ESG - the highest amongst global tobacco majors.

The company has also been included in the Dow Jones Sustainability Emerging Markets Index and rated at the 'Leadership Level' score of 'A-' for both Climate Change and Water Security by CDP.

ITC's strong growth in FMCG - Others segment continues. Q4 Segment Revenue was up 19.4 per cent YoY, at approximately 1.6x of Q4 FY20.

Staples, biscuits, snacks, noodles, dairy, beverages, soaps, fragrances, and agarbatti drove growth in the segment.

Education & stationery products business continues to witness strong traction.

Q4 Segment EBITDA was up 76 per cent YoY; margin expansion driven by multi-pronged interventions viz. premiumisation, supply chain agility, judicious pricing actions, digital initiatives, strategic cost management and fiscal incentives (including PLI).

ITC reported sustained volume claw back from illicit trade on the back of deterrent actions by enforcement agencies and relative stability in taxes.

Q4 Cigarettes net segment revenue was up 13.7 per cent YoY, and segment PBIT up 14.0% YoY. Market standing reinforced through focused portfolio/market interventions and agile execution.

ITC reported stellar performance in hotels business; Q4 Segment Revenue at 2x of Q4 FY22 and at approximately 1.7x of Q4 FY20. RevPAR was well ahead of pre-pandemic levels. Q4 Segment EBITDA at 272 cr. at 2.5x of Q4 FY20, up Rs 240 crore YoY.

Q4 Segment EBITDA margin at 34.8 per cent (vs 8.1 per cent in Q4 FY22 and 23.1 per cent in Q4 FY20) driven by higher RevPAR, operating leverage and structural cost interventions.

The agri business Q4 Segment revenue was up approximately 20 per cent YoY (ex-Wheat exports). Q4 Segment PBIT up 25.9 per cent YoY driven by growth in value-added agri products and leaf tobacco exports.

The company leveraged strong customer relationships, robust sourcing network and agile execution. Restrictions imposed on wheat & rice exports impacted agri business segment revenue.

Capacity utilisation of recently commissioned value-added spices processing facility equipped with state-of-the-art technology in Guntur being scaled up, ITC said.

Paperboards, paper, and packaging segment included the impact of planned shut down of pulp mills for capacity expansion.

Softening of pulp prices, muted demand mainly in global markets and relatively higher base impacted year-on-year segment revenue growth while fine paper segment remains buoyant. Q4 segment revenue was at Rs 2,221 crore and 3 Yr. CAGR at 15 per cent.

The Q4 Segment PBIT was at Rs 445 crore and 3 Yr. CAGR at 16 per cent.

Exceptional items represent proceeds received in partial settlement of the insurance claim towards leaf tobacco stocks, which were destroyed due to fire at a third party owned warehouse in an earlier year.