Essar Oil net profit up 78% at Rs 321 crore

Riding on higher refining margins, Essar Oil on Monday reported a 78 per cent rise in fourth-quarter net profit at Rs 321 crore, compared to Rs 180 crore a year earlier. Revenues for the January-March period jumped 24 per cent to Rs 14,846 crore.

Refining margins, or earnings on converting a barrel of crude oil into products, were $8.15 a barrel compared with $5.37 a year ago. “This is a strong financial result, driven by record refinery throughput of 14.76 million tonnes per annum and a healthy uplift of over 80 per cent in gross refinery margins,” Essar Oil Chief Executive Officer and Managing Director Naresh Nayyar said in a conference call.

Essar Oil said its Vadinar refinery on the west coast continued to operate well above its nameplate capacity of 10.5 million tonnes per annum. It processed a record 14.76 million tonnes of crude oil in 2010-11, nine per cent higher than last year.

The company said the expansion of Vadinar refinery was on schedule. It is expanding the refinery to 18 million tonnes a year by 2011 and to 20 million tonnes by September 2012.

“Demand for petroleum products in India is expected to continue to grow sharply and we remain focused on delivering our key projects, which in 2011 includes the first phase of our Vadinar refinery expansion,” Nayyar said.

Essar Oil has 1,635 petrol pumps, of which 1,381 are operational and 254 are in various stages of construction.

For 2010-11, the company’s net profit jumped to Rs 654 crore from Rs 29 crore in the previous year. Gross revenues rose 25 per cent to Rs 53,119 crore from Rs 42,402 crore.

Essar Oil shares closed 2.93 per cent down at Rs 135.70 on the Bombay Stock Exchange.