Reliance net up in Q3

MUMBAI JAN. 31. Reliance Industries has announced a net profit of Rs. 822 crores for the third quarter ended December 31, 2001 against Rs. 684 crores in the corresponding period of the previous year. Sales were lower at Rs. 5,467 crores against Rs. 6,430 crores while trading sales were higher at Rs. 299 crores (Rs. 125 crores). Other income amounted to Rs. 137 crores (Rs. 51 crores).

The company provided Rs. 218 crores (Rs. 294 crores) for interest, Rs. 441 crores (Rs. 394 crores) for depreciation, Rs. 35 crores (Rs. 34 crores) for current tax and Rs. 1 crore (nil) for deferred tax. Extraordinary income was Rs. 358 crores (nil) being capital gains from divestment of Larsen & Toubro shares.

For the nine months ended December 31, 2001, the net profit was Rs. 2,142 crores (Rs. 1,887 crores). Manufactured sales were Rs. 18,091 crores (Rs. 19,287 crores) and trading sales of Rs. 299 crores (Rs. 2,277 crores). Other income amounted to Rs. 432 crores (Rs. 205 crores).

The company provided Rs. 730 crores (Rs. 925 crores) for interest, Rs. 1,259 crores (Rs. 1,141 crores) for depreciation, Rs. 99 crores (Rs. 96 crores) for current tax and Rs. 3 crores (nil) for deferred tax. The company's capex during the nine month period was Rs. 592 crores on account primarily of oil and gas and normal capital expenditure.

Production including toll conversion during the nine month period increased to 8.6 million tonnes (7.9 million tonnes). Manufactured exports including deemed exports were Rs. 2,083 crores (Rs. 2,292 crores). The company's consolidated net profit is Rs. 2,795 crores considering the investments in its subsidiaries and associates. Anil D. Ambani, managing director, RIL, said, "We are satisfied with Reliance's performance in a tough environment for the global and domestic petrochemicals industry. The slowdown in demand for some of our major products, and the sharp decline in product selling prices, have impacted margins.Our optimal capacity utilisation rates, the continuing emphasis on speciality grades, productivity gains and cost reduction measures and further reduction in financial costs, have enabled us to maintain our performance in this extremely challenging period.

As we had anticipated, the downturn in the petrochemicals industry has been extended as a result of the unfortunate global events and its adverse impact on global economic growth. Our strong internal cash flows even in this difficult environment have enabled us to further progress our investments in the future growth areas of oil and gas and infocom, with the objective of maximising long term overall shareholder value."

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Commits Rs. 1,500 cr. investment in oil, gas

Reliance holds a 30 per cent interest in an unincorporated JV with Enron and ONGC to develop the proven Panna, Mukta and Tapti oil and gas fields. Oil and gas accounted for 3 per cent of Reliance's revenues during the year. According to Mr. Ambani, "Over the next 2-3 years, we will invest Rs. 1,500 crores in this venture and over the next five years, we expect oil and gas to contribute 15 per cent of turnover of the company."

The company's cellular telephony business through Reliance Telecom has seen its subscriber base increase to 3.45 lakhs and covers 118 cities and 15 States. The company will soon be rolling out plans for Kolkatta. To date, investments in the cellular network has been Rs. 800 crores.

Regarding Reliance Infocom's fibre optic network, Mr. Ambani said the 60,000 km nationwide network would connect 115 cities and offer voice/data and value added services. The backbone is expected to be ready by end-2002. Already, one data centre in Thane near Mumbai is operational and another in Bangalore is in progress. Mr. Ambani said Reliance's strategy in the power sector is clear. "The generation, transmission and distribution plans are driven through BSES." Any future bids for the assets of DPC will be done through BSES. Reliance has also formed a company, a special purpose vehicle (SPV), to bid for the candidates coming up for disinvestment by the Government and has bid for the IBP disinvestment.

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