CALCUTTA, Nov 21: ITC on Friday announced a net profit of Rs 301.73 crore in the six months to September 30, 1997, compared to Rs 180.80 crore in the corresponding half in 1996-97, a significant growth of 68 per cent. Operating profit margins have improved to 34.52 per cent from 24.2 per cent in the comparable period.

Sales, net of excise, rose by 8 per cent to Rs 1434.92 crore against Rs 1329.11 crore in the previous first half. Gross profit after interest but before depreciation and tax rose by 54.65 per cent to Rs 492.30 crore from Rs 318.33 crore.

Addressing a news conference, Chairman Y C Deveshwar told newsmen here today that the board has decided to induct two fulltime directors - Anup Singh and S S H Rehman, to strengthen the executive management team.

In a meeting here on Friday, it was also decided that in future, as part of the new corporate governance structure the number of executive directors will be maintained at five against the earlier practice of having ten fulltime directors.

Anup Singh, who has been working as the chief executive of the India Tobacco division since January 1997, will now take overall charge of the entire tobacco portfolio of the company.

S S H Rehman is the managing director of ITC Hotels and brings to the board his expertise in hotel management and will play a crucial role in developing the necessary skills for effective utilisation of the group's assets in the hotels and real estate businesses.

Deveshwar stated that the board has decided to make Landbase, a subsidiary of International Travel House as the vehicle for optimising benefits to be drawn from the real estate and hotels divisions of the ITC group.

On ITC Classic's restructuring plan and ITC's stand, Deveshwar made a candid observation: "I have no hesitation in telling you that it (Classic) was a rank bad management. The company's restructuring plan is being worked out and the earlier plan to inject funds through the preferential share route is subject to review and depends on what shape the plan finally takes. The mode of financing Classic is yet to evolve."

Significantly, ITC's total expenditure is down by 7 per cent to Rs 939.64 crore from Rs 1007.51 crore. Outgo on interest has reduced to Rs 41.20 crore from Rs 57.07 crore but depreciation provision is higher at Rs 44.26 crore against Rs 26.81 crore. On the status of investigation into the alleged contravention of certain provisions of FERA.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.