Essar Oil today posted a 46 per cent drop in net profit at Rs 546 crore for the March quarter mainly due to inventory valuation loss arising from dip in oil prices and a one-time interest cost.
The nation's second-biggest private refiner had posted a net profit of Rs 1,008 crore for the same three months a year ago, the company said in a statement here.
The company earned USD 10.41 on turning every barrel of crude oil into fuel in January-March period as against a gross refining margin of USD 10.12 in the previous fiscal.
It suffered an inventory valuation loss of Rs 326 crore as oil prices dipped, and also had to bear a one-time interest cost of Rs 160 crore in March quarter this year.
Revenue slipped 30 per cent to Rs 19,252 crore. "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."
Essar Oil's Vadinar refinery in Gujarat processed 5.12 million tonnes of crude in fourth quarter and 20.49 million tonnes in full year. This compared with 5.05 million tonnes in March quarter in 2014 and 20.23 million tonnes in FY14.
"This is the highest annual throughput of Essar Oil. Vadinar Refinery continues to operate at over 100 per cent capacity utilisation," it said.
L K Gupta, Managing Director and CEO of Essar Oil said: "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."
Suresh Jain, CFO of Essar Oil said the company continues to look at opportunities to further reduce interest cost and strengthen its balance sheet.
During the quarter under review, Vadinar Refinery processed 94 per cent of cheaper heavy and ultra heavy crude as against 88 percent in the previous fiscal.
Essar Oil said it has about 1,500 operational petrol pumps nationwide, with another 1,400 in various stages of implementation.
"With the government announcing deregulation of diesel prices in October 2014, diesel retail sales from Essar Oil's outlets is gradually picking up," the statement said.
During the year, Essar Oil more than doubled its retail volume from FY14, it said without giving numbers. Essar Oil retail sales now account for 8 per cent of its revenues (during Q4FY15) as against 2 per cent in the corresponding quarter last fiscal.
