Reliance profit jumps 16pc in Q1

MUMBAI, JULY 8: Reliance Industries Ltd (RIL), the largest company in the Indian private sector, has established a new corporate record b...

MUMBAI, JULY 8: Reliance Industries Ltd (RIL), the largest company in the Indian private sector, has established a new corporate record by reporting a 16 per cent jump in its net profit to Rs 510 crore in the first quarter (Q1) of the current fiscal ended June 1999 as against Rs 441 crore in the corresponding period of the last year. RIL had earned a net profit of Rs 1,704 crore during the full year ended March 1999.

According to its unaudited results for the quarter, the total sales of the company increased by 5 per cent to Rs 3,837 crore from Rs 3,645 crore in the previous period. However, RIL exports declined by 8.23 per cent to Rs 156 crore during the April-June period of 1999 from Rs 170 crore in the same period of last year.

Announcing the working results at a news conference here today, RIL managing director Anil Ambani said "the improvement in demand in the Asia Pacific region, coinciding with capacity outages in the global petrochemical industry, led to a sharp recovery in product prices in thefirst quarter". “The recovery has already shown signs of weakening. Based on present market trends we believe that the current momentum in earnings growth is unlikely to be sustained over the balance of the financial year," he added.

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RIL claimed it is the first Indian corporate to report profits over Rs 500 crore in a single quarter. The operating profit of the quarter increased by 12 per cent to Rs 900 crore from Rs 804 crore in the same period of last year. The cash profit increased to Rs 717 crore against Rs 636 crore for the corresponding period, an increase of 13 per cent.The company has provided a sum of Rs 207 crore (Rs 195 crore) for depreciation for the period and nil for taxation.

The earning per share (EPS) for the quarter is Rs 5.5 and cash earning per share (CEPS) is Rs 7.7. The total paid-up equity share capital stood at Rs 934 crore. The company’s contribution to the national exchequer in the form of various taxes increased by 12 per cent to Rs 854 crore over the corresponding previousquarter. The production volume of RIL also rose 12 per cent to 1.9 million tonnes during the quarter from 1.7 million tonnes in 1998-99.

Ambani said the commissioning of the new Rs 5,500 crore integrated petrochemicals complex at Jamnagar, comprising the world’s largest 1.4 million tonnes per annum of Paraxylene (PX) and 600,000 tonnes per annum of Polypropylene (PP) facilities has begun with the startup of 400,000 tonne per annum of PP. The entire complex will be commissioned, ahead of schedule, in the current financial year, significantly enhancing Reliance’s market leadership and global competitiveness.

“Reliance is committed to deploying its future cash flows in line with its announced capital allocation framework, with due emphasis on earnings growth, capital productivity and maximisation of shareholder value,” he added.

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