Essar Oil UK, which owns and operates Britain's Stanlow Refinery, today reported a marginal 4 per cent decline in net profit in 2017-18 as two-and-a-half month refinery turnaround shutdown led to lower processing.
Net profit in 2017-18 at USD 161 million (Rs 1,037 crore) was 4.2 per cent lower than USD 168 million in the previous year, company chief executive S Thangapandian said in a media conference call.
The shutdown was taken to connect revamped units which raised the refinery's capacity to 75 million barrels from 68 million previously.
On completion, this would deliver enhanced yields of high value products, reduce crude costs and drive revenue growth, he said.
"We operated for only nine and half months of the year as compared to 12 months in the previous fiscal," he said, adding profits would have been around USD 275 million if the refinery was to have operated for full year.
This is the third consecutive year when the company posted an EBITA in excess of USD 300 million. Also, the company remains debt free.
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The refinery earned USD 9.4 on turning every barrel of crude oil into fuel as compared to a gross refining margin of USD 8.4 in the previous fiscal.
Essar Oil UK, owned by Ruia family, is unlisted and not obliged to give quarterly earning numbers.
Stanlow processed 7.19 million tonnes of crude oil 2017-18 as compared to 9.09 million tonnes throughput in the previous fiscal.
The refinery completed the execution of all project upgrades during the turnaround, he said, adding expected margin improvements will yield an incremental of USD 75 million to USD 80 million annually in the prevailing market.
Including FY18, Essar has invested over USD 850 million since acquiring Stanlow in July 2011, helping to turn around the business and build a company that is both profitable and sustainable.
The firm now 53 petrol pumps in UK and is on track to achieve the target of 400 by 2023, he said.
Essar Oil UK Chairman, Prashant Ruia, said: "Stanlow has emerged as a top tier refinery in Europe, with 16% market share in the UK and a growing presence in the retail and aviation sectors. We will continue to make proactive investments in technology to build a sustainable business that remains competitive in the rapidly changing global energy market.