Essar Oil UK's net profit up four-fold to $35 mn in Dec qtr

Essar Oil UK, which owns and operates the Stanlow refinery, today reported nearly four-fold jump in its December quarter net profit as it entered the UK's fuel retail market with opening of first Essar branded service station.
Net profit of USD 35 million in October-December was 285 per cent higher than USD 9.1 million profit in the same period a year ago, the company said in a statement issued here.
Revenue was, however, 38 per cent lower at USD 1.09 billion due to lower oil prices.
In the nine months to December 31, 2015, Stanlow, which produces about 15 per cent of the UK's road transport fuel demand, processed 6.77 million tonnes of crude oil, a 7 per cent increase on the previous year's 6.35 million tonnes.

Gross revenues for the period stood at USD 4.04 billion, a 35 per cent drop from the USD 6.25 billion in the same period a year ago, largely due to the lower crude oil price which fell 52 per cent year on year average, it said.
Net profit in April-December was its highest ever at USD 179 million, against USD 35.3 million in FY15.

The company reported its best ever current price hydrocarbon margin at USD 10.1 per barrel, a 20 per cent increase from the USD 8.4 in FY15, primarily due to refinery reconfiguration and improved benchmark margins.
"Stanlow again saw the benefits of operating as an optimised single train site, which has increased the yield of high margin products such as gasoline and middle distillates and also reduced production of lower margin products such as fuel oil and naphtha," the statement said.

Essar said it entered the UK retail market, with opening of service stations at three sites - Coalville in Leicestershire, Walkden in Manchester and Middleton in Lancashire.
Essar Oil UK Executive Chairman Naresh Nayyar said, "This is a strong performance which reflected the many margin improvement projects undertaken by Essar at Stanlow."
"We are seeing the benefits of running as a single train optimised site, with robust operational delivery enabling us to take advantage of a supportive market environment. We continue to focus on further widening our crude slate to capture additional value, which has recently seen the processing of high pour point grades," he said.

The company, he said, is looking forward to add more retail outlets over the next few years.
Essar Oil UK Chief Financial Officer Sampath P said: "Our EBITDA and PAT are both record figures for a nine month period since Essar acquired Stanlow in 2011 and have been supported by strong product cracks.
"The business is in a healthy financial position, with no long term debt and ongoing margin improvement plans in place to deliver an even stronger bottom line.