Despite a slump in its net revenue by 34 percent, private oil refiner Essar Oil on Wednesday posted a healthy increase of 54 percent in its net profit at Rs. 1,063 crore for the first quarter of the current fiscal year.
Incidentally, this is the company's best ever quarterly performance, with the highest ever net profit - Rs.691 crore.
The net revenue during the quarter under review fell by 34 percent to Rs.16,340 crore against the earning of Rs.24,855 crore during April-June 2014.
The company said the dip in revenues was mainly because of lower crude oil prices prevailing in the global market.
"For the 12th consecutive quarter, our refinery has continued with its trend of registering steady and strong performance by operating beyond its rated capacity," company managing director and CEO L.K. Gupta said in a statement.
During the quarter, the Vadinar refinery continued to operate above its rated capacity, registering a throughput of 5.17 million tonnes.
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"The planned 30-day refinery maintenance shutdown between September and October this year will help us complete our Diesel Maximisation Project, which will enable us to convert lower margin intermediates like VGO to higher margin distillates like diesel. This will further improve our refining margins. Our retail expansion is on track and we are witnessing encouraging response and improvement in sales," he said.
During the quarter, 65 percent of the company's revenues came from the domestic market with the rest of the share being taken up by its exports.
The company said retail sales volumes of diesel have seen a consistent rise post deregulation and has contributed to the overall rise in domestic sales.
During the quarter, Essar Oil commissioned 51 new outlets. The company currently has about 1,550 operational retail outlets nationwide, with another 1,600 in various stages of implementation.
"Consistent strong financial performance has improved all financial parameters and ratios in the last two years. We are confident of further reduction in our interest cost through the ongoing dollarisation programme," said company CFO Suresh Jain.