At its refining business, Reliance reported a gross refining margin of $10.4 per barrel, which was the highest in six years; retail biz continued to do well
New Delhi : Reliance Industries reported highest quarterly profit in seven-and-a-half years on strong refining and petrochemical margins.
Standalone net profit at Rs 6,318 crore, or Rs 19.5 per share, in April-June was 11.8 % higher than Rs 5,649 crore, or Rs 17.5 a share, in the same period a year ago. The first quarter profit in the current financial year 2015-16 was highest since earning in October-December 2007.
Revenue fell 26 % to Rs 77,130 crore, hurt by a sharp fall in prices of crude oil and petroleum products, the company said.
Consolidated net profit rose 4.4 % to Rs 6,222 crore in April-June quarter of the current fiscal as opposed to Rs 5,957 crore a year ago, the statement said.
RIL, operator of the world’s biggest oil-refinery complex that can process low-grade crude and switch between fuels depending on market prices, earned $10.4 on turning every barrel of crude into petroleum product. This was the highest gross refining margin it has earned in six year as compared to $10.1 per barrel margin in preceding January-March quarter and $8.7 of Q1 of 2014-15 fiscal.
The company, which is investing $12 billion to boost petrochemical capacity and refinery processes as well as build facilities to import ethane from US, said a 23 % dip in its turnover to Rs 83,064 crore was mostly because of 43.5 % dip in oil prices.
Joint Chief Financial Officer V Srikanth said $5 billion more will be invested to complete the refining and petrochemical cracker and downstream projects.
“The sharp increase in demand for transportation fuels helped us realize strong refining margins,” Chairman Mukesh Ambani said.
RIL, which has in recent years invested in sectors like telecom, retail and financial services as it seeks to diversify revenue sources and reduce dependence on the country’s heavily-regulated oil and gas sector, said its telecom venture, Reliance Jio Infocomm will be able to start full commercial operations in the next financial year. Before the earning announcement, RIL shares fell 1.9 % to close at Rs 1,025.05 on the BSE.
While pre-tax profit from refinery business jumped 37.7 % to Rs 5,252 crore, earnings from petrochemical business soared 25.5 % to Rs 2,338 crore.
EBIT from oil and gas production business however dropped 97 % to Rs 32 crore.
RIL’s outstanding debt was higher at Rs 170,814 crore as on June. It had a cash balance of Rs 87,391 crore. Lower oil prices meant earnings from refinery business fell 30 % to Rs 68,729 crore but segment pre-tax profit was up 37.7 % at Rs 5,252 crore.
During the quarter, RIL’s Jamnagar refineries processed 16.6 million tonnes, which translates into 107 % of the installed capacity. Singapore refining margin in Q1 were USD 8 per barrel.”Strong gasoline cracks, low energy cost and favourable crude differential helped boost refining margins and outperform regional benchmarks,” RIL said.
Petrochemical business revenue was down 18 % at Rs 20,858 crore but segment pre-tax profit was up 25.5 % to Rs 2,338 crore, primarily on account of increase in prices. US shale gas revenue fell 47.2 % to Rs 854 crore .
Retail business turnover rose 17 % to Rs 4,698 crore while pre-tax profit was up 37 % at Rs 111 crore. RIL said it added 126 stores in first quarter to take the
total store count to 2,747.
