Chennai Petroleum (500110) Q4 03/04 earnings summary

Executive summary

• FY 2003-04 delivered record turnover of Rs.9,430.45 crore, PAT of Rs.400.05 crore and higher refinery throughput; most of the 3 MMTPA expansion was commissioned.

• Expansion lifted installed capacity to 10.5 MMTPA; the Hydrocracker and Visbreaker units remained to be commissioned, with the Hydrocracker expected in July 2004.

Financial highlights

• Turnover, including excise duty, rose to Rs.9,430.45 crore from Rs.8,636.52 crore; reported increase 9.19%.

• Profit before tax increased to Rs.572.26 crore from Rs.487.96 crore; profit after tax rose 32% to Rs.400.05 crore from Rs.302.89 crore.

• Profit before interest, depreciation and tax was Rs.736.52 crore versus Rs.696.63 crore; interest expense fell to Rs.46.80 crore from Rs.106.65 crore.

• EPS was Rs.26.86 versus Rs.20.31; directors recommended a 50% dividend, up from 35%, absorbing Rs.84 crore including dividend distribution tax.

• Internal resources generated reached Rs.439.98 crore from Rs.389.29 crore; reserves and surplus rose 27.57% to Rs.1,462.33 crore.

Outlook and guidance

• Hydrocracker expected operational by July 2004; FCCU revamp and tertiary treatment plant revamp targeted for September 2004, and zero-discharge project for December 2004.

• Proposed 5.8 MGD desalination plant budgeted at Rs.193.31 crore, with a 30-month implementation schedule; statutory and environmental clearances were being pursued.

• New 42-inch crude pipeline, estimated at Rs.40 crore, targeted for the last quarter of FY 2005-06, subject to rehabilitation and resettlement timing.

• A proposed 492 MW residue-fuel power project with Neyveli Lignite Corporation was under development; the partner was updating the detailed feasibility report.