MRPL net profit drops 91% on rupee fall

Mangalore Refinery and Petrochemical (MRPL) has reported a 91% drop in net profit in the quarter ended September 30, mainly due to losses on account of depreciation of rupee.

Net profit during July-September period fell to Rs 94 crore from Rs 282 crore a year ago, MRPL Chairman Sudhir Vasudeva said.

"The Q2 is impacted by steep rupee devaluation from Rs 45.35 per US dollar [as on June 30] to Rs 49.30 per US dollar [as on September 30]," he said, "This steep rupee depreciation by almost 10% has adversely impacted the profitability, resulting in reduced PAT."

Vasudeva, who is also the chairman and managing director of ONGC and chairman of ONGC Group of companies, said MRPL earned $1.66 on turning every barrel of crude oil into fuel in the quarter as against $6.15 per barrel gross refining margin a year ago.

"Despite shutdown of crude distillation unit [the core of a refinery] and vacuum distillation unit [VDU] for revamp for part of September 2011, the physical performance of the refinery operation was higher. However, the steep rupee devaluation has impacted the Profit After Tax," he said.

MRPL achieved an operating margin during Q2 of $4.84 per barrel as against $3.96 per barrel during the corresponding quarter last fiscal.

The company turnover rose by 29% to Rs 12,404 crore. The refinery processed 3.08 million tonnes of crude oil in the quarter, a 7% increase over the previous year.