Petronet net nearly doubles on lower corporate tax rate

Petronet LNG Ltd, the country's biggest importer of liquefied natural gas, on Tuesday reported a near doubling of net profit in September quarter as it derived benefit of lower corporate tax rate.

Net profit in July-September at Rs 1,089 crore was 90 per cent higher than Rs 572.89 crore net profit in the same period, company CEO and Managing Director Prabhat Singh told reporters here.

"Pursuant to the introduction of the lower tax rates for corporates by the government for FY 2019-20, the company has taken the benefit of lower corporate tax rate of 22 per cent (as against 30 per cent) in the current quarter," he said. "Due to the same, there is a reversal of deferred tax liability of Rs 380 crore."

Revenue from operations, however, slipped to Rs 9361.18 crore from Rs 10,745.34 crore in the second quarter of the previous fiscal year due to fall in volumes, prices and foreign exchange variations.

 

Lower LNG imports impacted revenues by Rs 900 crore while an over USD 1 drop in gas prices led to Rs 560 crore cut in revenues. Also foreign exchange variation cost was Rs 150 crore, he said.

Petronet's Dahej import facility in Gujarat operated at around 108 per cent of its expanded name place capacity of 17.50 million tonnes and processed 240 trillion British thermal units of LNG as against 211 TBtus processed a year back.

Its Kochi terminal operated at 20 per cent of the 5 million tonnes name place capacity.

"The company elected to exercise the option of a lower tax rate of 25.17 per cent (announced last month by the government)," the notes to the company's financial results said. "Accordingly, the deferred tax liabilities (net) (DTL) as at June 30, 2019 and estimate of tax expense for the quarter ended June 30, 2019 have been remeasured and resultant impact of Rs 376 crore on DTL and Rs 70 crore respectively pertaining to previous quarter have been recognised in the current quarter."

Petronet said its board of directors approved a special interim dividend of Rs 5.50 per share for the 2019-20 fiscal year.