The Hindu Business Line : Tata Tea's Q4 net profit declines

Mumbai June 1 Tata Tea's fourth quarter net profit amounted to Rs 3.89 crore, dipping from Rs 19.32 crore a year ago, because of the impact of interest on borrowings made for the acquisition of Energy Brands Inc (Glaceau).

But operating profit before tax, at Rs 8.14 crore (Rs 4.25 crore), nearly doubled, while income from operations showed a 14 per cent increase, at Rs 251 crore (Rs 219 crore).

Interest costs amounted to Rs 14.27 crore (nil, a year ago), while income from investments declined, to Rs 7.8 crore from Rs 24.46 crore a year earlier. For fiscal 2006-07, Tata Tea's net profit amounted to Rs 307 crore (Rs 187 crore), 64 per cent higher from the previous year.

This was due to an increase in brand sales of 12 per cent, said Mr Percy Siganporia, Managing Director of the company. The bottomline also got a boost from a one-time gain of Rs 133 crore arising from sale of investments.

Income from operations at Rs 1,070 crore was up by 9 per cent, and this despite the company's exit from South India Plantations, added Mr Siganporia.

Consolidated results

The company's consolidated net profit for the fiscal amounted to Rs 443 crore making for a 48 per cent rise. Income from operations rose 29 per cent to Rs 4,044 crore. The company attributed this to higher sales of branded tea and inclusion of income from its acquisitions Jemca and Eight O Clock Coffee.

Profit from operations rose by 36 per cent to Rs 528 crore. The board of directors has recommended a dividend of 150 per cent for the fiscal under consideration.

The company's shares closed at Rs 952.3 on BSE, rising 3.4 per cent on Friday.