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RIL reports 8.8% increase in net profit to Rs. 10,251 crore in Q3

 File photo of Reliance Industries Limited Chairman and Managing Director Mukesh Ambani
File photo of Reliance Industries Limited Chairman and Managing Director Mukesh Ambani
Oil & gas, petrochemicals, telecom and retail major Reliance Industries Limited (RIL) today reported an 8.8 percent increase in net profit to Rs. 10,251 crore in the third quarter (Q3) ended December 31, 2018 from Rs. 9,420 crore in the same quarter of the previous financial year.
 
In the process, the company has become the first Indian private sector corporate to cross Rs. 10,000 crore quarterly profits milestone.
 
In its financial results for the quarter released here today, the company said its revenue had gone up by 55.9% in Q3 to Rs. 171,336 crore from Rs. 109,905 crore in the corresponding quarter of FY18.
 
Profit before depreciation, interest and tax was up 20% at Rs. 23,801 crore from Rs. 19,837 crore in the same quarter of FY18, a press release from RIL said.
 
On a standalone basis, the company’s net profit increased by 5.6% to Rs. 8,928 crore.
The gross refining margin (GRM) during the quarter was $ 8.8 per barrel as compared to $ 11.6 in the same quarter of the previous fiscal, it said.
 
“In our endeavor to consistently create more value for our country and stakeholders, our company has become the first Indian private sector corporate to cross Rs. 10,000 crore quarterly profits milestone. I am proud to be part of the committed and talented team at Reliance that has helped achieve many milestones in our continuing growth journey,” RIL Chairman and Managing Director Mukesh D. Ambani said.
 
“In an oil price environment that witnessed heightened volatility through the quarter, RIL has delivered strong quarterly results on a consolidated basis. Competitive cost positions and integration benefits is core to our Oil to Chemicals (Refining and Petrochemicals) business, driving sustained performance even in challenging global business environment. In our new-age consumer businesses, we maintained robust growth momentum across Retail and Jio platforms and the share of consumer businesses is steadily increasing its contribution to the overall profitability of the Company. In our wireless business, our customer-centric offerings and strong ubiquitous network are helping to digitalize India at an unprecedented rate. As we execute on our strategies to deliver superior products and services to Indian consumers, I am confident, Reliance is well-positioned for the future and for the next cycle of growth,” he said.
 
The company said the increase in its revenue was primarily on account of higher price realizations and volumes for its Petrochemical and Refining businesses along with continuing strong growth momentum in consumer businesses. 
 
“Product prices for the Refining and Petrochemicals business increased in line with 10.4% higher average Brent crude oil price. The higher volumes in Petrochemical business are on account of stabilization and ramp-up of new petrochemical facilities. Retail business and Digital Services business recorded an increase of 89% and 51% in revenue during the quarter compared to the corresponding quarter of the previous year,” the release said.
 
Exports (including deemed exports) from RIL’s India operations were higher by 35.2% at Rs. 62,378 crore ($ 8.9 billion) as against Rs. 46,151 crore in the corresponding period of the previous year due to  higher volumes of polymer products and fibre intermediates on account of stabilization of new facilities at Jamnagar and higher product prices in petrochemical and refining business. 
 
Other expenditure increased by 44.3% to Rs. 20,456 crore ($ 2.9 billion) as against Rs. 14,177 crore in corresponding period of the previous year primarily due to higher fuel prices and higher production. Increase in other expenses also reflect the rapid scale-up of consumer businesses, mainly on account of higher network operating expenses, regulatory charges, programming and telecast related expenses, lease rent and selling expenses, the release said.
 
Outstanding debt as on December 31, 2018 was Rs. 274,381 crore ($39.3 billion) compared to Rs.  218,763 crore as on March31, 2018. 
 
Cash and cash equivalents as on December 31, 2018 were at Rs. 77,933 crore ($ 11.2 billion) compared to Rs. 78,063 crore as on March 31, 2018. These were in bank deposits, mutual funds, CDs, Government Bonds and other marketable securities.  
 
The capital expenditure for the quarter was Rs. 27,274 crore ($ 3.9 billion) including exchange rate difference.  
 
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The release said 3Q FY19 revenue from the Refining & Marketing (R&M) segment increased by 47.3% Y-o-Y to Rs. 111,738 crore ($ 16.0 billion) while Segment EBIT declined by 18.0% Y-o-Y to Rs. 5,055 crore ($ 724 million). R&M segment performance was impacted by sharp decline in light distillate product cracks on Y-o-Y basis. This was partly offset by strength in middle distillate cracks on Y-o-Y basis. RIL maintained significant premium over Singapore complex margins due to product yield optimization and robust risk management. GRM for 3Q FY19 stood at $ 8.8/bbl, outperforming Singapore complex margins by $ 4.5/bbl. 
 
According to it, 3Q FY19 revenue from the Petrochemicals segment increased by 37.1% Y-o-Y to Rs. 46,246 crore  ($ 6.6 billion) due to increase in price realizations and volumes primarily in polymer products and fibre intermediates. Petrochemicals segment EBIT was at Rs. 8,221 crore ($ 1.2 billion), up 42.9% Y-o-Y.  
 
Strong volume growth and robust polyester chain margins offset the impact of weaker polymer margins. Y-o-Y volume growth was led by successful stabilization of the world’s largest ROGC, its downstream units and new PX facility at Jamnagar. 
 
The company said its 3Q FY19, revenue for the Oil & Gas segment decreased by 27.5% Y-o-Y to Rs. 1,182 crore. Segment EBIT at Rs. (185) crore as against Rs. (291) crore in the corresponding period of the previous year. The segment performance continued to be impacted by declining volume. Domestic production was lower at 13.2 BCFe, down 33% Y-o-Y whereas production in US Shale operations declined by 37% to 21.2 BCFe. 
 
In the Organized Retail Business, revenue for 3Q FY19 grew by 89.3% Y-o-Y to Rs. 35,577 crore from Rs.  18,798 crore. 
 
“Healthy festive season sales and new store openings resulted in another robust quarter. Reliance Retail further consolidated its leadership position and is India’s largest, most profitable and fastest growing retailer. Segment EBIT rose by 210.5% Y-o-Y to Rs. 1,512 crore from Rs. 487 crore demonstrating strong operating profit during the quarter. EBIT margin for the segment improved by 160 bps to 4.2% reflecting scale benefits. Retail now has 9,907 stores with reach across 6,400+ towns and cities. 
 
In the Media Business, Network18 Media & Investments Limited reported 3Q FY19 consolidated revenue of Rs. 1,524 crores (up 20% YoY on a comparable basis) driven by advertising tailwinds, successful movies like “Andhadhun” and healthy growth in subscription income. Comparable operating EBITDA rose 18% Yo-Y to Rs. 88 crores in Q3FY19, despite continuing investments into recent launches Colors Tamil and Colors Kannada Cinema. EBIT rose to Rs. 58 crore as operating leverage drove broadcast profitability, led by continued strong performance of regional channels across both our news and entertainment portfolios. 
 
NNN

(Our News Desk can be contacted at desk@netindian.in)

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