Mangalore Refinery and Petrochemicals (500109) Q4 99/00 earnings summary

Executive summary

• FY2000 ended with a net loss of Rs 29,968.44 lakh, as higher crude costs and constrained product pricing weakened refining margins.

• Refinery capacity expansion to 9 MMTPA was completed, but Phase II remained in trial runs and commercial production was delayed by technical issues.

Financial highlights

• Turnover was Rs 302,120.40 lakh vs Rs 241,877.02 lakh in FY1999; loss after tax was Rs 29,968.44 lakh vs profit of Rs 1,406.18 lakh.

• Loss before tax was Rs 32,299.94 lakh; interest and finance charges were Rs 23,695.90 lakh vs Rs 34,370.04 lakh, while depreciation was Rs 14,276.32 lakh vs Rs 13,445.19 lakh.

• Raw material costs rose to Rs 300,245.15 lakh from Rs 199,343.57 lakh; operating and other expenses were Rs 15,134.58 lakh vs Rs 15,784.39 lakh.

Outlook and guidance

• Commercial production from the expanded refinery was expected within a few months; dual operating streams and scale efficiencies were expected to improve operations and competitiveness.

• The Mangalore-Hassan-Bangalore pipeline was expected to be completed in 2001/02, widening product access; a direct-marketing study was under management review ahead of sector deregulation expected from April 2002.

• Plans included crude-mix and operations optimisation, value-added products, crude procurement capabilities, and financial re-engineering; marketing rights applications remained under consideration by government.