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RIL Q3 profit falls 11.4% to Rs 5085 cr, GRM at $7.3/bbl

The News International Team

Reliance Industries  on Friday matched street expectations by reporting profit of Rs 5,085 crore for the December quarter, down 11.4 percent compared to Rs 5,742 crore in previous quarter on standalone basis.

The profit was expected at Rs 5,000 crore for the quarter, according to the average of estimates of analysts polled by CNBC-TV18.

“Focus on operational efficiency and the superior configuration of assets helped company deliver an industry-leading performance in the refining and petrochemicals business despite sharp decline in crude and feedstock prices,” said Mukesh Dhirubhai Ambani, chairman and managing director.

“We continued to advance our refining and petrochemicals business capital investments, which will come to fruition over the next 4-6 quarters,” he added.

The petrochemical major’s net sales declined 16.9 percent to Rs 80,196 crore during the quarter from Rs 96,486 crore in previous quarter.

Gross refining margin for the third quarter of current financial year 2014-15 was USD 7.30 a barrel against USD 8.30 a barrel in second quarter.

Other income on sequential basis jumped 12.2 percent to Rs 2,402 crore in Q3FY15 from Rs 2,140 crore in Q2FY15.

Standalone operating profit (EBITDA) slipped 12.5 percent to Rs 7,208 crore in the quarter ended December 2014 with margin expansion of 50 basis points.

Petrochemical earnings before interest & tax (EBIT) fell 8.6 percent quarter-on-quarter to Rs 2,197 crore with margin at 10 percent. Refining EBIT dropped 15.5 percent to Rs 3,199 crore with margin expansion of 30 basis points at 4.4 percent on sequential basis.

Oil & Gas EBIT was down 19.6 percent to Rs 267 crore with margin falling 400 basis points at 20 percent during the same period.

Consolidated Earnings

Reliance’s net profit declined 12 percent sequentially to Rs 5,256 crore and net sales slipped 14.8 percent to Rs 93,528 crore in the third quarter of current financial year 2014-15, on consolidated basis.

KG-D6 field produced 0.5 million barrels of crude oil, 0.1 million barrels of condensate and 38.5 BCF of natural gas in Q3FY15.

Fall in gas production was mainly due to natural decline in the fields partly offset by incremental production from new well MA08 and side track in well MA6H which was implemented in October-March period of FY14, said Reliance in its filing to the exchange.

Petchem EBIT slipped 12.6 percent quarter-on-quarter to Rs 2,064 crore in December quarter with margin (unchanged) at 9 percent. Refining EBIT fell 15 percent to Rs 3,267 crore with margin rising 30 basis points to 4 percent while oil & gas EBIT rose 1.7 percent to Rs 832 crore with margin increasing 200 basis points to 29 percent during the same period.

Shale gas business witnessed macro headwinds, with a sharp downturn in commodity prices, especially in case of oil, said the company. WTI dropped 40 percent from USD 90 a barrel at the beginning of the quarter to USD 53 a barrel by the end of quarter. Overall capex for the shale gas business in Q3 was at USD 264 million.

Organised retail revenue increased 12.5 percent sequentially to Rs 4,686 crore and EBIT climbed 34.34 percent to Rs 133 crore with margin rising 40 basis points to 2.8 percent in the quarter gone by.

Reliance Retail saw net addition of 279 stores during the quarter accelerating the pace of store opening to over 3 stores a day.

Reliance Industries said it has cash & cash equivalents of Rs 78,691 crore at the end of December quarter.

The scrip of Reliance Industries (which announced earnings after market hours) closed at Rs 869, up 0.51 percent on the Bombay Stock Exchange.

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