RIL Q2 net vaults over 17% to Rs 9,516 crore

RIL's revenue rose 54.5 per cent to Rs156,291 crore during the quarter, boosted by record earnings in petrochemicals business and higher earnings from retail business and telecom arm, which made up for a decline in refinery margins.

Consolidated net profit of the company stood at Rs9,516 crore, or Rs16.1 per share, in the second quarter of current fiscal, a 17.4 per cent increase from Rs8,109 crore, or Rs 13.7 a share, in the similar quarter of the previous financial year, the company said in a statement.

For the quarter ended 30 September 2018, RIL achieved revenue of Rs156,291 crore ($21.6 billion), an increase of 54.5 per cent compared to Rs101,169 crore in the corresponding period of the previous year.

RIL attributed the increase in revenue primarily to higher price realisations of petrochemical and refinery products led by 44.5 per cent increase in Brent crude price. Increased revenues also reflect higher volumes with the commissioning and ramp-up of new petrochemical facilities, it added. 

Its retail business, which comprises 9,146 stores across 5,800-plus towns and cities, saw pre-tax profit jump 213 per cent to Rs1,392 crore on the back of more than doubling of revenues to Rs32,436 crore.

Reliance Jio, the group's telecom arm, posted a standalone net profit of Rs681 crore, which was 11.3 per cent more than the previous quarter as subscriber base swelled to 252.3 million.

Commenting on the results, Mukesh D. Ambani, chairman and managing director, Reliance Industries Limited said: “Our Company delivered robust operating and financial results for the quarter despite macro headwinds, with strong growth in earnings on Y-o-Y basis. Our integrated refining and petrochemicals business generated strong cash flows in a period of heightened volatility in commodity and currency markets. Our world-class petrochemicals assets contributed record earnings; endorsing benefits of diversified feedstock, integration and superior product portfolio. Use of ethane feedstock at Nagothane cracker from this quarter has further enhanced feedstock optionality.

“Our commitment to create consumer value is gathering momentum, with the robust scale-up of Indiacentric consumer facing businesses. The financial performance of both Retail and Jio reflect the benefits of scale, technology and operational efficiencies. Retail business EBITDA has grown three fold on Y-o-Y basis whereas Reliance Jio EBITDA has grown nearly 2.5 times. Jio has now crossed 250 million subscriber base and continues to be the largest mobile data carrier in the world.”

Retail and digital services businesses also recorded sharp increases in revenue of 121 per cent and 52 per cent, respectively year-on-year during the quarter compared to the corresponding quarter of the previous year.

Exports (including deemed exports) from RIL’s India operations were higher by 45.5 per cent at Rs60,460 crore ($8.3 billion) against Rs41,560 crore in the corresponding period of the previous year. This was due to higher petrochemical product volumes and higher product prices in petrochemical and refining business, RIL stated.

RIL’s other expenditure increased by 52.6 per cent to Rs18,809 crore ($2.6 billion) against Rs12,323 crore in the corresponding period of the previous year, primarily due to higher power and fuel expenses on account of commissioning of petrochemical projects at Jamnagar and increase in fuel prices. Increase in other expenses also reflect the rapid scale-up of consumer businesses, mainly on account of higher network operating expenses, access & regulatory charges and selling expenses.

Operating profit before other income and depreciation increased by 35.6 per cent to Rs21,108 crore ($2.9 billion) from Rs15,565 crore in the corresponding period of the previous year. 

RIL saw record operating performance and significant volume growth and margin improvement in petrochemicals business and multi-fold growth in contribution from retail and digital Services businesses.

Depreciation (including depletion and amortisation) was Rs5,229 crore ($721 million) compared to Rs4,287 crore in corresponding period of the previous year. The increase was primarily on account of capitalisation of projects in the petrochemicals business during previous period and also RJIL’s Wireless Telecommunication Network.

Finance cost increased to Rs3,932 crore ($542 million) from Rs2,272 crore in the  corresponding period of the previous year, primarily on account of commencement of petrochemical projects at Jamnagar and digital services business. Higher loan balances also contributed to the increase in finance cost.

Profit after tax was up 17.4 per cent at Rs9,516 crore ($1.3 billion) against Rs8,109 crore in the corresponding period of the previous year.

Basic earnings per share (EPS) for the quarter ended 30 September 2018 was Rs16.1 against Rs13.7 in the corresponding period of the previous year.

Outstanding debt as of 30 September 2018 stood at Rs258,701 crore ($35.7 billion) compared to Rs218,763 crore as of 31 March 2018.