Reliance Industries Ltd. (RIL) recorded a net profit of Rs.11,526 crore for the nine months ended December 31, 2009, which was down by 1.3 per cent compared to Rs.11,682 crore for the corresponding period of the previous year.
However, the company reported a 15.8 per cent increase in the net profit at Rs. 4,008 crore in the third quarter ended December 31, 2009, against Rs. 3,462 crore in the corresponding quarter in the previous year.
The turnover for the nine months increased by 17.2 per cent to Rs.140,133 crore and the profit before depreciation and interest charges by 22.5 per cent to a record level of Rs.23,290 crore. The profit before tax increased by 4.7 per cent to Rs.14,713 crore The cash profit increased by 16.1 per cent to Rs.19,528 crore. The gross refining margin recorded at $6.2 a barrel for the nine months period and $5.9 a barrel for the third quarter.
“I am delighted that both our key projects, namely, the new SEZ refinery and KG D6 oil and gas development have ramped up successfully and safely. This reaffirms our belief in our ability to create truly world-class assets in the integrated energy value chain. Reliance is well poised to benefit from the improving global economic environment and domestic markets opportunities,” said company Chairman and Managing Director Mukesh D. Ambani, while commenting on the third quarter results of the current fiscal.
“Increase in volume accounted for 46 per cent growth in revenue which was partially offset by lower prices accounting to 29 per cent reduction in revenue.” Exports were higher by 6 per cent at Rs.78,182 crore.
Consumption of raw materials and purchase of traded goods increased by 23 per cent to Rs.107,228 crore mainly on account of higher crude oil processed in SEZ refinery. “Volumes accounted for 53 per cent increase in value of consumption of raw materials which was partially offset by 30 per cent reduction in prices, primarily of crude and naphtha.”
Staff cost was Rs.1,729 crore for the period as against Rs.1,903 crore, reflecting the impact of cost optimisation initiatives. Other expenditure decreased by 6 per cent from Rs.9,193 crore to Rs.8,661 crore. “Increase in royalty on gas production and selling expenses on additional volumes was offset by exchange rate gain.”
The operating profit before other income and depreciation increased by 19.3 per cent from Rs.17,976 crore to Rs.21,445 crore. Net operating margin was higher at 15.3 per cent as compared to 15 per cent in the corresponding period of the previous year “due to incremental share of the oil and gas business, stronger petrochemical margins partially offset by softer margin environment in refining.” Other income was at Rs.1,845 crore as against Rs.1,040 crore “due to higher interest income on account of average higher cash and cash equivalents.” Depreciation (including depletion and amortisation) was higher by 89.5 per cent at Rs.7,105 crore against Rs.3,749 crore in the corresponding period of the previous year “primarily on account of higher depreciation in oil and gas and refining and marketing business segments.”
Interest cost was higher at Rs.1,472 crore as against Rs.1,215 crore. Gross interest cost was lower at Rs.2,332 crore as against Rs.3,797 crore for the corresponding period of the previous year on account of lower interest rates and exchange differences. Interest capitalised was lower at Rs.860 crore as against Rs.2,582 crore in the corresponding period of the previous year due to commissioning of projects.