RIL logs record net on firm petro, retail show

Consolidated profit rises 18% to Rs 9,459 cr despite lower refining margins

Reliance Industries (RIL) on Friday reported its highest ever quarterly net profit as bumper earnings from the retail business, improved profitability of telecom arm and near doubling of earnings from petrochemical business offset lower margins from oil refining business.

Consolidated net profit of Rs 9,459 crore, or Rs 16 per share, in April-June, was 17.9 per cent higher than Rs 8,021 crore, or Rs 13.5 a share, in the same period of previous fiscal, the oil-to-telecom conglomerate said. Revenue was up 56.5 per cent at Rs 141,699 crore.

The April-June 2017 profit has been taken after excluding Rs 1,087 crore exceptional income from the sale of a stake in Gulf Africa Petroleum Corp, the company said.

Its retail business, which comprises of 8,533 stores across over 5,200 towns and cities, saw pre-tax profits jump by a 266 per cent to Rs 1,069 crore on more than doubling of revenues to Rs 25,890 crore.

The petrochemical business saw pre-tax profits jump by 94.9 per cent to Rs 7,857 crore after the company stabalised operations of a new refinery off-gas cracker and other downstream units. The operator of world's largest oil refining complex saw pre-tax earnings from the business declining 16.8 per cent to Rs 5,315 crore as margins dipped. It earned $10.5 on turning every barrel of crude oil into fuel as compared to a gross refining margin of $11.9 per barrel.

The pre-tax loss of oil and gas business widened to Rs 447 crore from Rs 373 crore in the quarter due to continued decline in production. With telecom continuing to drain investments, Reliance said its outstanding debt rose to Rs 242,116 crore as of June 30 from Rs 218,763 crore as on March 31. Cash in hand was marginally higher at Rs 79,492 crore.

Mukesh D. Ambani, Chairman and Managing Director, RIL, said: "We continue to focus

on strong delivery through operational excellence in our portfolio of businesses. Financial results of 1Q FY19 underscore the strength of the petrochemicals we have reinforced over the last investment cycle."

Petrochemicals business generated record EBITDA with strong volumes and an upswing in polyester chain margins while refining business performance remained steady despite the seasonal weakness in cracks.

To stop Iranian imports

RIL said it will stop Iranian crude imports from November if the US sanctions kick in.

It also said this won't lead to supply disruption as it sources a very small quantity of its total crude imports from Iran now. RIL's oil imports from Iran had surged by about 45 per cent to 67,000 bpd in 2017 after it began sourcing crude from the country in April 2016 and in the January-April 2018, it imported about 96,000 bpd.