Essar oil back to black on high margins

On the back of robust refining margins, Ruias-promoted Essar Oil has reported a net profit of Rs 469 crore for the quarter ended June 30. The company had posted a loss of Rs 70 crore during the corresponding previous quarter.

On turning every barrel of crude oil into fuel (gross refining margins, or GRMs) the company earned $7.38 per barrel, 27 per cent higher against $5.79 per barrel in the April-June quarter in 2010-11.

“The company has been, for the past several quarters, reporting profits consistently, driven by record refinery throughput and a healthy uplift in GRMs,” said Naresh Nayyar, company’s CEO and managing director, during a conference call.

The company’s revenues were up 36 per cent at Rs 16,478 crore against Rs 12,048 crore in the April-June quarter of the previous financial year.

“This is a strong quarterly performance. We are now close to completing our refinery expansion project, which will enhance the refinery’s complexity. This would have a strong impact on our refining margins,” added Nayyar.