Reliance Industries (RIL) Q2: Total income from operations (net) slid 35.43 per cent to Rs 70,901 crore. The figure stood at Rs 1,09,797 crore in the same quarter a year ago.
Reliance Industries Ltd., on Friday said its fiscal second-quarter net profits grew 12.5% to Rs6720 crore, from Rs 5972 crore a year earlier, helped by a higher refining margin on the back of low global crude prices.
During the July-September quarter, its revenue declined by 33.8% to Rs75,117 crore compared to Rs1,13,396 crore a year earlier, the company said in a earnings statement. Its profits before depreciation, interest and tax increased by 6.4% from a year earlier to Rs12,636 crore.
Also Read: Reliance Industries Q2: 10 key takeaways
Reliance Industries’ gross refining margins – the money it makes by converting every barrel of crude into fuel and allied products – was at $10.6 per barrel during the quarter, which the company said is the highest in the past seven years.
Decline in revenue at the Mumbai-based company was led by a 50.6% on-year fall in benchmark oil price, it said. This in turn impacted its exports from India, which were 35.5% during the quarter at Rs42,636 crore compared to a year earlier, it said, adding lower crude prices resulted in lower prices for its products.
“Refining business performance was notable, as it benefited from a combination of high utilization levels, advantageous crude market opportunities and strong global fuels demand,” Mukesh D. Ambani, chairman of Reliance Industries said.
Reliance Industries’ premium over Singapore complex margins – a benchmark in the refining industry – widened to $ 4.3/bbl during the quarter, the highest level since early 2009, the company said. During July-September, the benchmark Singapore complex margin averaged $6.3 /bbl as compared to $ 8.0 /bbl in the previous April-June quarter, and $ 4.8/bbl in July-September quarter of last fiscal, it said.
Compared on a sequential basis, “light distillates particularly gasoline continued their strong showing but margins were pulled down by an oversupplied middle distillate market and resulting lower middle distillate cracks over the previous quarter. Further, sharp decline in fuel oil cracks weighed on Singapore complex margins,” the company said.
During the quarter through September, revenue of Reliance Industries’ oil & gas exploration and production business globally fell 31.1% to Rs2,067 crore, while its domestic operations declined 15.5% to Rs1,166 crore. The domestic revenue fell because of lower oil/ condensate prices and decline in gas production from its KG-D6 block, it said. At KG-D6 block, oil production fell 24% on-year to 0.39mmbbl while gas production reduced by 9% to 37BCF, it said.
The company’s US shale gas operations also saw its revenue decline by 44.6% during the quarter to Rs897 crore from the same period last year, because of lower WTI oil price, higher supplies from the OPEC, and adverse macro news flows, especially concerns over potential demand slowdown in China,”it said.
Reliance Industries’ retail business saw its revenue grow 22% on-year to Rs5091 crore, while its profit before depreciation, interest, and tax, or PBDIT increased by 12.9% to Rs210 crore, the company said. The retail unit added 110 stores during the quarter taking the total stores under operations to 2857 stores across 250 cities across the country.
Reliance Industries, which is gearing to launch its high-speed telecommunications services said its retail unit “will soon launch its own brand of 4G LTE smartphones under the brand LYF. The handset will have features enabling users to make phone calls using LTE and WiFi networks, it said.
Its media business — Network18 Media and Investments Ltd.,- had a revenue of Rs801 crore with an Ebidta of Rs35 crore during the quarter, the company said.
The company’s outstanding debt at end of September increased by 7.4% during the September quarter to Rs1,72,765 crore compared to Rs1,60,860 crore at the end of last fiscal that ended March 2015. Its cash balances were at Rs85,720 crore at end of September.
Ahead of the results, shares of Reliance Industries closed 0.9% at Rs912.20 per stock while the broader S&P BSE Sensex closed 0.76% higher on Friday.
Highlights OF Reliance Industries quarter’s performance (CONSOLIDATED):
* Revenue (turnover) decreased by 33.8 % to Rs 75,117 crore ($ 11.5 billion)
* PBDIT increased by 6.4 % to Rs 12,636 crore ($ 1.9 billion)
* EBIT margin improved by 400bps to 9.3%
* Profit Before Tax increased by 8.1 % to Rs 8,493 crore ($ 1.3 billion)
* Cash Profit (excluding exceptional item) increased by 4.2 % to Rs 9,636 crore ($ 1.5 billion)
* Net Profit increased by 12.5 % to Rs 6,720 crore ($ 1.0 billion)
Highlights OF Reliance Industries quarter’s performance (STANDALONE)
* Revenue (turnover) decreased by 35.3 % to Rs 64,515 crore ($ 9.8 billion)
* Exports decreased by 35.5% to Rs 42,636 crore ($ 6.5 billion)
* PBDIT increased by 10.4 % to Rs 11,450 crore ($ 1.7 billion)
* Profit Before Tax increased by 13.5 % to Rs 8,384 crore ($ 1.3 billion)
* Cash Profit increased by 11.5 % to Rs 9,006 crore ($ 1.4 billion)
* Net Profit increased by 14.3 % to Rs 6,561 crore ($ 1.0 billion), at record level
* Gross Refining Margin of $ 10.6/bbl for the quarter, highest in last seven years
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