COVID-19 impact: GAIL Q1 net profit tanks 80% to Rs 256 crore

State-owned gas utility GAIL India Ltd on Thursday posted an 80 per cent drop in its June quarter net profit as it suffered losses on the marketing of natural gas and petrochemicals.

Standalone net profit of Rs 255.51 crore, or Rs 0.57 per share, in April-June, was 80.1 per cent lower than Rs 1,287.53 crore, or Rs 2.85 a share, net profit in the same period a year back, the company said in a regulatory filing.

"The sharp decline in financial performance is mainly attributable to a significant impact in physical performance due to nation-wide lockdown during the earlier part of the quarter coupled with lower price realization in petrochemicals, liquid hydrocarbons, and natural gas," it later said in a statement.

The company suffered a pre-tax loss of Rs 545.46 crore on the marketing of natural gas in the first quarter of 2020-21 fiscal, as compared to a pre-tax profit of Rs 850.48 crore last year. Revenues from natural gas marketing too dipped 39 per cent to Rs 9,443.72 crore as the shutdown of industries led to lower offtake of the fuel.

While pre-tax profit on gas transmission business fell 16 per cent, loss on petrochemical business came at Rs 154.43 crore.

Total revenue from operations at Rs 12,087.46 crore was lower than Rs 18,311.46 crore revenue in Q1 of 2019-20.

"During the quarter, natural gas transmission and marketing volume stood at 90.22 million standard cubic meters per day (mmscmd) and 81.16 mmscmd, as against 105.41 mmscmd and 96.55 mmscmd respectively in Q1 FY20," GAIL said.

Petrochemical sales and liquid hydrocarbon sales stood at 183,000 tonnes and 265,000 tonnes, as against 136,000 tonnes and 296,000 tonnes respectively during Q1 FY20.

During the quarter, the consolidated group turnover stood at Rs 12,180.62 crore, as against Rs 18,481.56 crore in Q1 FY20 while the group's Profit after tax (PAT) came at Rs 642.97 crore, as against Rs 1,503.67 crore in Q1 FY20.

Manoj Jain, chairman and managing director, GAIL, said that with the gradual relaxation of lockdown and increase in economic activities, the physical performance of the company has picked up significantly in all segments and the company is presently operating at near pre-lockdown levels.

He further added that though the capex during the first quarter was affected due to lockdown, GAIL expects to significantly improve capex during the remaining quarters.

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