Chennai Petroleum (500110) Q4 98/99 earnings summary

Executive summary

• FY1998-99 turnover reached a record ₹3,747.39 crore vs ₹2,720.08 crore; PBT was a record ₹275.64 crore and PAT ₹204.93 crore.

• Profit before interest, depreciation and tax was ₹466.65 crore vs ₹367.18 crore; internal resource generation rose to ₹230.93 crore from ₹174.06 crore.

• Higher import-parity pricing after APM reforms supported turnover, while total crude throughput declined to 6.745 MMt from 7.521 MMt, including planned maintenance shutdowns at Manali.

Financial highlights

• Turnover was ₹3,747.39 crore vs ₹2,720.08 crore; operating and other expenses were ₹3,374.19 crore vs ₹2,429.98 crore.

• PBT rose to ₹275.64 crore from ₹144.47 crore; PAT was ₹204.93 crore vs ₹129.28 crore, after tax provision of ₹70.71 crore vs ₹15.20 crore.

• Interest expense declined to ₹112.01 crore from ₹141.87 crore; depreciation was ₹79.00 crore vs ₹80.85 crore.

• Record total turnover reflected higher refinery-gate realisations on import-parity pricing versus the prior retention-price framework.

Outlook and guidance

• Proposed Manali capacity expansion of 3 MMTPA, estimated at ₹2,175 crore, had pre-PIB approval; investment approval was under PIB consideration.

• Diesel hydrodesulphurisation project, estimated at ₹766 crore, was at an advanced completion stage, targeting lower diesel sulphur content from 1% to 0.25% by weight.

• A 0.5-to-1.0 MMTPA Cauvery Basin Refinery expansion, estimated at ₹30 crore, was planned for FY1999-2000; permanent crude jetty estimated at ₹95 crore was targeted for commissioning in Q4 2000.

• Future priorities included dynamic pricing, cost control, productivity, product quality, crude sourcing and an optimal product mix amid sector deregulation.