RIL achieves consolidated revenue of Rs. 659,205 crore in FY2019-20

RIL achieved a consolidated revenue of Rs. 659,205 crore ($ 87.1 billion), an increase of 5.4% as compared to Rs. 625,212 crore in the previous year. Increase in revenue is primarily on account of higher revenues from the Consumer businesses. Digital Services business and Retail business recorded an increase of 40.7% and 24.8%, respectively, in revenue as compared to previous year. Revenues for the Refining and Petrochemicals business declined in line with fall in average oil and product prices for the year. Average Brent oil price declined 13% Y-o-Y, while realisations for key petrochemical products declined by 15%-32% Y-o-Y. This was partially offset by higher crude throughput and petrochemicals production during the year.

The Company has identified ‘Financial services’ as a separate business segment based on internal reorganization of its business segments. RIL is engaged in financial services through its treasury investment activities, Payment Bank, Consumer lending business, Insurance broking business among others. Accordingly, the Company has reported the performance of these activities as a separate business segment.

Exports (including deemed exports) from India were lower at Rs. 202,830 crore ($ 26.8 billion) as against Rs. 224,391 crore in the previous year. The decline in exports was primarily on account of lower realization due to fall in crude oil prices.

Segment EBITDA increased by 3.2% to Rs. 92,964 crore ($ 12.3 billion) from Rs. 90,084 crore in corresponding period of the previous year. The increase in Segment EBITDA was led by strong performance in Consumer businesses which grew by 49.3% Y-o-Y. Retail business benefitted from new store additions, strong footfalls and high LFL growth. Digital services segment witnessed robust growth in subscriber base and strong customer engagement through the year. Refining segment performance was resilient as higher volumes offset weaker product cracks and demand environment. Petrochemicals segment earnings were impacted by weak margins with subdued demand in a wellsupplied market.

The outbreak of Coronavirus (COVID-19) pandemic globally and in India has caused significant disturbance and slowdown of economic activity. During this period, there has been significant volatility in oil prices, resulting in uncertainty and sharp reduction in oil prices. Through the quarter, oil prices declined 73% impacting inventory valuation. In view of the above, the Company has provided for noncash inventory holding losses for the quarter. This has been disclosed as an Exceptional Item of Rs. 4,245 crore, net of tax (tax Rs. 899 crore) in the financial results.

Profit after tax (excluding exceptional item) was higher by 11.3% at Rs. 44,324 crore ($5.9 billion) as against Rs. 39,837 crore in the previous year.

Profit after tax (including exceptional item) was higher by 0.1% at Rs. 39,880 crore ($5.3 billion) as against Rs. 39,837 crore in the previous year.

In spite of the Covid-19 crisis and the lockdowns, the due-diligence by Saudi Aramco for the planned investment in the O2C business is on track as both the parties are committed and actively engaged.

Q4 FY2019-20 Consolidated Financial Performance

The fall out of COVID-19 outbreak on economic activity disrupted businesses across manufacturing and services sectors during the quarter. Global oil markets witnessed significant volatility on account of demand destruction and excess supplies. Lockdowns and travel restrictions in most geographies led to steep fall in transportation fuel demand. Global oil demand in CY2020 is expected to fall by 9.3 mb/d Y-o-Y, lowest level in last 8-years. As a result, global refining utilization and economics are likely to get impacted in the near term. The pandemic outbreak also impacted Petrochemical segment during the quarter with demand slowdown in most end-use markets including consumer discretionary and packaging demand.

While RIL maintained near normal utilization at all major facilities, gradual resumption of economic activity in the coming months is expected to aid demand recovery for fuels and petrochemical products.

Non-grocery retail business was impacted by nation-wide lockdown. Retail segment operated most of its food and grocery formats in consonance with local directives. Retail grocery stores ensured supply of essential goods and other items of daily use to consumers. Retail business leveraged its network of collection centers and actively engaged with key suppliers to ensure priority supplies and assured quantity of essentials.

Digital Services ensured uninterrupted connectivity for families, businesses and government agencies; further enabling health-care at home, work from home and learn from home under its “Corona Haarega India Jeetega” initiative.

For the quarter ended 31st March, 2020, RIL achieved revenue of Rs. 151,209 crore ($ 20.0 billion), a decrease of 2.5% as compared to Rs. 155,151 crore in the corresponding period of the previous year. Decrease in revenue is primarily on account of 10.1% decline in Refining and Petrochemicals business revenues. Sharp fall of 20.5% Y-o-Y in average Brent oil price led to lower product price realization across the hydrocarbon chain. This was partially offset by continuing growth in consumer businesses, even amidst the operational issues posed by the pandemic. Digital Services and Retail business recorded an increase of 30.0% and 4.2% Y-o-Y respectively, in revenue during the quarter.

Exports (including deemed exports) from RIL’s India operations were lower by 6.8% at Rs. 45,708 crore ($ 6.0 billion) as against Rs. 49,052 crore in the corresponding period of the previous year due to lower price realizations from Refining and Petrochemicals business. This was partially offset by increase in sales volume from Refinery business by 14.4%.

Other expenditure decreased by 5.7% to Rs. 21,166 crore ($ 2.8 billion) as against Rs. 22,444 crore in the previous year primarily due to lower operating costs.

Segment EBITDA increased by 5.3% to Rs. 23,325 crore ($ 3.1 billion) from Rs. 22,147 crore in corresponding period of the previous year. The increase in Segment EBITDA was led by strong performance in Digital Services (+42.9%), Retail (+32.9%) and Refining (+26.2%) businesses.

Superior product and value proposition in retail and digital service businesses is driving customer acquisition and improved operating metrics.

Depreciation (including depletion and amortization) was Rs. 6,332 crore ($ 837 million) as compared to Rs. 5,295 crore in corresponding period of the previous year. Increase in depreciation was primarily on account of capitalization of Gasification project and digital services projects.

Finance cost was at Rs. 6,064 crore ($ 801 million) as against Rs. 4,894 crore in corresponding period of the previous year. Higher loan balances, currency depreciation and lower interest capitalization on account of commissioning of Digital projects, led to increase in finance cost by 23.9% Y-o-Y.

Profit after tax (excluding exceptional item) was higher by 3.7% at Rs. 10,813 crore ($ 1.4 billion) as against Rs. 10,427 crore in the corresponding period of the previous year.

During the quarter, the Company has provided for non-cash inventory holding losses due to sharp decline in oil markets. This has been disclosed as an Exceptional Item of Rs. 4,245 crore, net of tax (tax Rs. 899 crore) in the financial results.

Profit after tax (including exceptional item) was lower by 37.2% at Rs. 6,546 crore ($ 0.9 billion) as against Rs. 10,427 crore in the corresponding period of the previous year.

Outstanding debt as on 31st March, 2020 was Rs. 336,294 crore ($44.4 billion).

Cash and cash equivalents as on 31st March, 2020 were at Rs. 175,259 crore ($ 23.2 billion).

The capital expenditure for the quarter ended 31st March, 2020 was Rs. 21,707 crore ($ 2.9 billion) including exchange rate difference.

RIL retained its domestic credit ratings of “CRISIL AAA/Stable” from CRISIL and “IND AAA/Stable” from India Ratings and an investment grade rating for its international debt from Moody’s as “Baa2” and “BBB+” from S&P.

Shares of RELIANCE INDUSTRIES LTD. was last trading in BSE at Rs.1467.05 as compared to the previous close of Rs. 1426.2. The total number of shares traded during the day was 1277127 in over 47637 trades.

The stock hit an intraday high of Rs. 1494.5 and intraday low of 1440. The net turnover during the day was Rs. 1876995490.