The Hindu Business Line : Tata Tea Q3 net down 37 pc

Mr Percy T. Siganporia, Managing Director, Tata Tea, and Mr L.K. Krishnakumar, Group CFO, Tata Tea and Tetley Group, at a press conference in Mumbai on Monday.

Our Bureau

Mumbai, Jan. 28 Packaged tea maker Tata Tea Ltd, also owner of the Tetley brand, reported a 37.5 per cent dip in its third quarter standalone net profit to touch Rs 58.38 crore (Rs 94.2 crore).

However, the profit excluding exceptional items and tax nearly doubled, at Rs 86.35 crore (Rs 44 crore), helped by growth in sales of branded tea.

The dip in its standalone net profit was due to the fact that the profit during the previous year’s corresponding quarter was boosted on account of exceptional profits on sale of shares, amounting to Rs. 63.53 crore.

Income from operations rose 22 per cent, at Rs 355.38 crore (Rs 290.77 crore).

On a consolidated basis, the company’s net profit for the quarter surged to Rs 1,307 crore, as against Rs 117.19 crore in the corresponding quarter the previous year.

This was mainly on account of the profit on sale of stake held in Energy Brands Inc, which boosted the profit in the third quarter of the current fiscal.

Mr Percy T. Siganporia, Tata Tea Managing Director, told newspersons that the profit on the October 2007 sale of the company’s stake in Energy Brands Inc was Rs 1,605 crore. The company used part of the proceeds of the stake sale to retire some debt. “Subsequent quarters will see reduction of interests cost and we will become a zero-debt company on consolidated basis by this fiscal,” Mr L.K. Krishnakumar, Group CFO, said.

The company’s consolidated income during the quarter stood at Rs 1,185 crore, up 7 per cent from the year-ago period.

On the global front, the company’s sales in the UK and Canadian markets were good, but it had to face tough market conditions in the US, where it markets the Tetley and 8 ‘O’ Clock brands. The company was focusing on other tea variants like green tea and red tea in the foreign markets, said Mr Peter Unsworth, COO, Tetley group.

The company’s shares closed at Rs 790.60 crore on Monday, down 0.35 per cent.