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Strong quarterly performance by Essar Oil

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July 29, 2015 Bookmark and Share  
Highest ever quarterly PAT, EBITDA and Current Price Gross Refining Margin (CP GRM)
  • PAT at Rs 1,063 crore compared to Rs 691 crore in Q1FY15; up 54%
  • EBITDA at Rs 2,060 crore vs Rs 1,606 crore in Q1FY15; up 28%
  • Highest ever Current Price Gross Refining Margin (CP GRM) at $11.05/bbl vs $9.04/bbl in Q1FY15; up 22%
  •  Raniganj CBM production at 0.65 million scmd, making Essar Oil India's largest CBM gas producer
  • About 1,550 retail outlets operational, with another 1600+ under implementation

Statement of standalone financial results for the quarter ended on June 30, 2015. Read more

Essar Oil, India's second largest private refiner, today reported its best ever quarterly performance, with the highest ever PAT (Rs 1,063 crore), EBIDTA (Rs 2,060 crore) and CP GRM ($11.05/bbl) in the first quarter of FY2015-16.

The gross revenues for the quarter stood at Rs 20,572 crore, which is 25% lower than the Rs 27,317 crore reported in Q1FY15. This dip in revenues was mainly because of lower crude oil prices prevailing in the global market.

 Q1FY16Q1FY15% change
Profit After Tax (in Rs crore)1,06369154
EBIDTA (in Rs crore)*2,0601,60628
Gross Revenue (in Rs crore)20,57227,317(25)
CP GRM (in $/bbl)11.059.0422
Throughput (in million tonnes)
* EBIDTA includes forex variations

Refinery performance
During the April 2015 - June 2015 quarter (Q1FY16), the Vadinar Refinery continued to operate above its rated capacity, registering a throughput of 5.17 million tonnes. With its increased complexity, post the expansion and optimisation projects that were completed in 2012, the refinery continues to process a high volume of heavy and ultra-heavy crudes that enable better refining margins. In terms of finished products, the refinery continues to produce a high proportion of light and middle distillates that also have a positive impact on margins.

Management Speak
Talking on the results, LK Gupta, Managing Director & CEO, Essar Oil, said: "It is encouraging to begin the fiscal year with such strong performance. For the 12th consecutive quarter, our Refinery has continued with its trend of registering steady and strong performance by operating beyond its rated capacity.The planned 30-day refinery maintenance shutdown between September and October this year will help us complete our Diesel Maximisation Project, which will enable us to convert lower margin intermediates like VGO to higher margin distillates like diesel. This will further improve our refining margins. Our retail expansion is on track and we are witnessing encouraging response and improvement in sales."

Suresh Jain, CFO, Essar Oil, said, "We have declared record quarterly results on the back of stellar operating and financial performance. Consistent strong financial performance has improved all financial parameters and ratios in the last two years. We are confident of further reduction in our interest cost through the ongoing dollarisation programme."

Marketing & Retail Operations
During the quarter, 65% of Essar Oil's revenues came from the domestic market, while the rest came from exports. Retail sales volumes of diesel have seen a consistent rise post deregulation and has contributed to the overall rise in domestic sales.

Retail sales accounted for 9% of Essar Oil's revenues in Q1FY16 against 2% in the corresponding quarter last fiscal. During the quarter, Essar Oil commissioned 51 new outlets. The Company currently has about 1,550 operational retail outlets nationwide, with another 1,600 in various stages of implementation.

Exploration & Production
At our flagship Raniganj CBM Asset, we have achieved production of 0.65 million scm/d (standard cubic meters per day), with an open flow potential of 0.75 million scm/d. This is being sold to industrial consumers in the catchment area. Essar Oil is presently India's largest CBM gas producer.

While 136 wells have been placed on gas production, additional 126 wells have been already drilled and presently are at various stages of the hydrofracking-completion-dewatering cycle for gas ramp up to 1.2 million scmd over the next few months. We envisage the peak production from Raniganj at around 2.5-3 million scmd. We have built a high quality infrastructure including gas conditioning and compression stations, in-field pipelines of over 200 kms and last mile pipeline connectivity network to end users of approx. 60 kms. Essar anticipates completing the development program ahead of the May 2016 deadline as per the Contract with the Government of India

About Essar Oil
Essar Oil is a fully integrated oil & gas company of international scale with strong presence across the hydrocarbon value chain from exploration & production to refining and oil retail. Essar Oil owns India's second largest single site refinery having a capacity of 20 million tonnes and complexity of 11.8, which is amongst the highest globally. It has a portfolio of onshore and offshore oil & gas blocks with about 1.7 billion barrels of oil equivalent in reserves & resources. There are about 1,550 Essar-branded oil retail outlets in various parts of India with another 1,600 under various stages of implementation.

About Essar Global Fund Limited (Essar)

Essar Global Fund Limited is an investment fund managed by its investment manager, Essar Capital Limited. The Fund is a global investor, controlling a number of world-class assets diversified across the core sectors of Energy, Metals & Mining, Infrastructure (comprising ports and EPC businesses) and Services (primarily comprising shipping and BPO businesses). The aggregated revenues of the Fund's portfolio companies total US$35 billion. The Fund's portfolio companies employ over 60,000 people across 29 countries, and have adopted international standards of health, safety, environmental protection and corporate governance.

Media Contacts:
Rabin Ghosh, Corporate Communications, (Mumbai)

Essar Oil Limited:
CIN : L11100GJ1989PLC032116
Registered Office: Khambhaliya Post,
P O Box 24, District Devbhumi Dwarka,
Gujarat - 361305, India.
Tel:: +91 261 6682 400 F +91 261 5585 645

Tel: 91 99 301 36268
Email: rabin.ghosh@essar.com

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