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Indian Oil Corporation (IOC), the nation’s largest fuel retailer, has posted a 33 per cent decline in net profit for the quarter ended March 2015 on inventory valuation loss and higher base.
The company reported a net profit of Rs 6,285 crore compared with Rs 9,389 crore in the corresponding quarter of the previous previous financial year. “The main reason for the dip in profit is the higher compensation of Rs 7,000 crore received from the government in the fourth quarter of 2013-14 which increased the base,” Chairman and Managing Director B Ashok said at a post-results press conference.
A K Sharma, director, finance, added that the inventory loses came down to Rs 871 crore during the quarter from Rs 2,300 crore in the corresponding quarter of FY14. The average gross refining margin for the January-March quarter stood at $8.77 a barrel compared with $2.17 in the same quarter a year ago, the company said in a statement. The refining margin came down to $0.27 a barrel in FY15 from $4.24 in the previous financial year.
The gross refining margin of the company in 2014-15 was lower mainly on account of inventory valuation loss of Rs 15,600 crore which translates into $6.46 a barrel. This compared with an inventory gain of Rs 3,900 crore in 2013-14. Total income of the company also dipped 30 per cent to Rs 94,791 crore from Rs 1,35,465 crore in the corresponding quarter of 2013-14.
IOC received total discounts of Rs 23,597 crore on crude purchase from upstream firms as part of the compensation for the under-recoveries in 2014-15. The company also received Rs 14,960 crore from the government as its share of the compensation for the under-recovery burden.
For the full year, IOC reported a 25 per cent decline in net profit at Rs 5,273 crore compared with Rs 7,019 crore in FY14. Total income also slipped 7.3 per cent to Rs 4,41,670 crore from Rs 4,76,627 crore in the previous year.
IOC’s refineries processed 53.6 million tonnes of crude oil in 2014-15 compared with 53.1 million tonnes in FY14, Ashok said. Fuel sales rose to 71.8 million tonnes from 70 million tonnes in 2013-14.
Ashok also said the company added 950 retail outlets in FY15 including 6,230 mini-petrol pumps called kisan seva kendras and plans to open up to 1,200 retail outlets in the current financial year.
The 60 per cent fall in global crude oil prices between June 2014 and February 2015 led to the purchase value of crude dipping to Rs 1.95 lakh crore on purchase of 52.4 million tonnes in 2014-15, from Rs 2.41 lakh crore on buying 51.4 million tonnes in the previous financial year, Ashok said.
The company also sold 2.4 million tonnes of petrochemicals in FY15 compared with 2.1 million tonne sales in the previous financial year. IOC also sold 3.4 MT of gas in 2014-15, registering a growth of six per cent.
The company’s share price at the BSE closed at Rs 355.95 on Friday, down 1.3 per cent from Thursday.
