Chennai Petroleum (500110) Q4 01/02 earnings summary

Executive summary

• FY02 turnover fell to Rs.6,273.09 crore from Rs.7,132.62 crore; profit before tax declined to Rs.88.89 crore from Rs.147.43 crore, reflecting lower throughput, margins and lube base-stock demand.

• A 20% dividend was recommended despite lower profitability; refinery expansion, residue-based power generation and operational efficiency remained strategic priorities.

Financial highlights

• Turnover was Rs.6,273.09 crore versus Rs.7,132.62 crore; profit before interest, depreciation and tax was Rs.296.00 crore versus Rs.381.66 crore.

• Profit before tax was Rs.88.89 crore versus Rs.147.43 crore; profit after tax was Rs.63.71 crore versus Rs.122.43 crore.

• Value added declined to Rs.436.57 crore from Rs.557.57 crore; internally generated resources were Rs.136.64 crore versus Rs.187.96 crore.

• Plan-project expenditure rose to Rs.404.79 crore from Rs.85.78 crore; non-plan project expenditure was Rs.31.13 crore versus Rs.35.64 crore.

Outlook and guidance

• Manali’s 3 MMTPA expansion, taking capacity from 6.5 to 9.5 MMTPA, was scheduled for completion by July 2003; estimated cost Rs.2,360.38 crore.

• FY02–07 investment outlay was projected at Rs.2,400 crore; expansion, crude receipt infrastructure and a residue-fuelled joint-venture power project were key priorities.

• Post-deregulation focus shifted from maximizing crude throughput to optimizing product mix, crude selection, inventories and gross refinery margin through refinery business optimization and a linear-programming model.