Reliance Industries reported results that matched expectations with Net Profit decreasing by 4.5 per cent to Rs 5,256 crore ($ 834 million) for the 3rd quarter ending Dec 31, 2014.
Gross refining margin for the third quarter as was expected took a hit and came in at $7.30 a barrel against $ 8.30 a barrel in second quarter.
"Our focus on operational efficiency and the superior configuration of assets helped us deliver an industry-leading performance in the refining and petrochemicals business despite sharp decline in crude and feedstock prices. The performance also highlights the robustness of our risk management and proficiency of people and processes across the integrated chain.
We continued to advance our refining and petrochemicals business capital investments, which will come to fruition over the next 4-6 quarters. These investments demonstrate our commitment to creating value through the business cycle. During the quarter, Reliance Retail registered Y-o-Y growth of 19% in turnover with improved margins and profitability".
According to Reliance, the quarter witnessed heightened volatility across the hydrocarbon business. Benchmark crude oil prices declined by around 40% through the quarter, with consequent impact on petrochemical feedstock and product prices.
While headline deltas were strong, declining feedstock prices impacted buying sentiment across product categories. Downstream converters ran down inventories, operating at minimal stock levels.
RIL, in line with its operating strategy, aggressively sold down stocks to maintain optimal levels of inventory, which impacted realized deltas and margins for products. This coupled with lower holding value of closing-stock impacted performance of refining and petrochemicals businesses.
Meanwhile, Reliance Retail posted 18.9 per cent increase in revenues at Rs. 4,686 crore for the third quarter ended December 31, 2014. The company, a part of Reliance Industries Ltd, had a turnover of Rs. 3,941 crore during the same period of last fiscal.