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Essar Oil has reported a 46 per cent drop in net profit for the January- March quarter at Rs 546 crore against Rs 1,008 crore a year ago.
Gross revenue for the quarter stood at Rs 19,252 crore, which was 30 per cent lower than the Rs 27,691 crore reported a year ago. The dip in revenues is mainly due to lower crude oil prices, which fell 50 per cent over a year ago. As against the October-December 2014 quarter, prices were down by a third.
Due to the fall in prices, the company recorded an exceptional item of inventory losses at Rs 326 crore and an interest loss of Rs 160 crore due to dollarisation of its balance sheet.
Gross refining margin (GRM) for the January-March quarter was the highest ever at $10.41 per barrel against $10.12 per barrel a year ago. The company said, despite a fall in crude oil prices, key product cracks have generally remained steady, resulting in robust refining margins.
To crack crude oil means turning it into useful petroleum products.
Earnings before interest, taxes, depreciation, and amortisation (Ebitda) during the quarter stood at Rs 1,804 crore, against Rs 2,082 crore a year ago. Suresh Jain, chief financial officer, said, “FY15 has been a very successful year, where our refinery has delivered stellar operating performance and our financing cost has declined significantly.”
This enabled us to declare highest ever GRM, EBIDTA and Profitability. We continue to look at opportunities to further reduce interest cost and strengthen our Balance Sheet.”
The company's scrip was trading at Rs 108 per share up 3.6 per cent on the Bombay Stock Exchange.
For the year ended, Essar Oil reported net profit at Rs 1,521 crore against Rs 126 crore in FY14. Gross revenues for the fiscal stood at Rs 92,983 crore, 13 per cent lower than the Rs 1,07,190 crore reported in FY14.
"The dip in revenues is mainly due to lower crude oil price, which fell by about 50 per cent during the year. Average crude oil price for FY15 was lower by over 20 per cent as compared to FY14," the company said.
Gross Refining Margin (GRM) for the year stood at $8.37 per barrel as compared to $7.98 per barrel in FY14, up 5 per cent.
LK Gupta, Managing Director and CEO, Essar Oil, said: “We are happy to close the financial year with robust figures, both operationally and financially. Going forward, we expect further improvement in our product mix in favour of still higher proportion of light and middle distillates post completion of Gasoil Maximisation Project, which is expected by end of October 2015. On the retail front, we are witnessing encouraging response and improvement in sales.”
