Apart from strong growth in petrochemical business, refining margins expanded to a fresh seven-year high of $11.5 a barrel
New Delhi : Reliance Industries reported its highest-ever quarterly net profit of Rs 7,290 crore for the three months ended December on refinery margins spiking to seven-year high.
Net profit of Rs 7,290 crore, or Rs 24.8 per share, in October-December was 38.7 % higher than Rs 5,256 crore, or Rs 17.8 a share, in the same period a year ago, the company said in a statement. Sales, however, fell 24 % to Rs 73,341 crore on benchmark crude oil prices declining 42.7 % year-on-year. The operator of the world’s biggest oil-refinery complex earned USD 11.5 on turning every barrel of crude oil into fuel during the third quarter of the current fiscal as compared to a gross refining margin of USD 7.3 per barrel in the year-ago period.
RIL said refining margins expanded because of strong petrol and naphtha cracks, seasonal rebound in middle distillates cracks, robust demand growth and sourcing of advantageous crude.
“Our portfolio of world-class refining and petrochemical assets are paying off handsomely. Refining business delivered yet another record performance on the back of seven-year high refining margins and highest ever crude throughput,” RIL Chairman and Managing Director Mukesh Ambani said.
RIL’s refineries processed 18 mln tn in Oct-Dec, up from 17.1 mln tn in Jul-Sep and 17.7 mln tn in Oct-Dec last year. The company’s average refinery capacity utilisation stood at a record 116% in Oct-Dec.
Reliance Retail continued its growth momentum and achieved significant milestones in the quarter. It posted highest-ever quarterly turnover of Rs 6,042 crore during the third quarter against Rs 4,686 crore during the same period last year registering a growth of 29 %.
PETROCHEM
Driven by robust polymer margins, the company’s petrochemicals business also delivered one of its best performances in Oct-Dec despite a fall in revenue for this segment.
In Oct-Dec, segment EBIT margin improved by 170 bps sequentially and 460 bps on year to 13.6%.
Pre-tax profit from refining business almost doubled to Rs 6,491 crore in October-December, the same from petrochemical business soared 28 % to Rs 2,639 crore.
“On a Q-o-Q (sequential) basis, margins strengthened on back of strong light distillates especially high naphtha cracks which rallied on strong petrochemical and gasoline blending demand, while gasoline cracks continued its strength from previous quarter. Seasonal recovery in middle distillate cracks also supported the margins,” the company said.
RIL’s outstanding debt was higher at Rs 178,077 crore as on December 31, 2015 when compared to Rs 172,765 crore as on September 30. Its cash balance was also higher at Rs 91,736 crore, compared with Rs 85,720 crore. Other income was higher at Rs 2,426 crore as against Rs 2,340 crore in corresponding period of the previous year due to gains on sale of investments.
Interest cost was lower at Rs 921 crore as against Rs 1,137 crore in October-December 2014-15.
UPSTREAM
RIL’s upstream business continued to reel under pressure of falling prices and low output in the domestic as well as US shale operations.
The consolidated revenues from the oil and gas production business declined 37.9% on year, and 14.6% sequentially, to 17.65 bln rupees. The company said that the fall in its oil and gas output was primarily due to a natural decline in producing assets. Revenue from US shale gas operations declined 14% sequentially and 48.2% on year to Rs 7.71 bln while operating profit declined to Rs 610 mln from Rs 1.88 bln in the previous quarter and Rs 5.67 bln in the year-ago quarter.
The company added that its shale gas business is dealing with the adverse macro environment through prudent capital expenditure by reducing activity and preserving cash.
“The benefits of low crude oil and energy prices for our downstream businesses clearly outweigh the impact of these factors on our upstream segment, reflecting in the record earnings for the quarter,” Ambani said. Shares of Reliance Industries ended up 2.6% at Rs 1,043.60 on the National Stock Exchange. -Cogencis/PTI
