RIL Quarterly Performance Highlights

25-Jul-19

Highlights Of Quarter’s Performance (Consolidated)

* Revenue increased by 22.1% to ` 172,956 crore (US$25.1 billion)

* PBDIT increased by 9.1% to ` 24,486 crore (US$3.5 billion)

* Profit Before Tax increased by 4.7% to ` 14,366 crore (US$2.1 billion)

* Cash Profit increased by 1.8% to ` 16,184 crore (US$2.3 billion)

* Net Profit increased by 6.8% to ` 10,104 crore (US$1.5 billion)

Highlights Of Quarter’s Performance (Standalone)

* Revenue decreased by 3.0% to ` 96,384 crore (US$14 billion)

* Exports decreased by 4.5% to ` 50,158 crore (US$7.3 billion)

* PBDIT decreased by 1.4% to ` 16,985 crore (US$2.5 billion)

* Profit Before Tax decreased by 1.7% to ` 12,109 crore (US$1.8 billion)

* Cash Profit decreased by 5.9% to ` 11,842 crore (US$1.7 billion)

* Net Profit increased by 2.4% to ` 9,036 crore (US$1.3 billion)

* Gross Refining Margin (GRM) of US$8.1/bbl for the quarter

Corporate Highlights For The Quarter (1q Fy20)

* Reliance Industries Limited (RIL) and BP announced the sanction of the MJ project (also known as D55) in Block KG D6, offshore the east coast of India. MJ is the third of three new projects in the Block KG D6 integrated development plan and its approval follows sanctions for the development of ‘R-Series’ deep-water gas field in June 2017 and for the Satellites cluster in April 2018. Together the three projects are expected to develop a total of about 3 trillion cubic feet (tcf) of discovered gas resources with a total investment of circa ` 35,000 crore (US$5 billion). These projects together, when fully developed, will bring about 1 billion cubic feet a day of new domestic gas onstream, phased over 2020-2022.

* Reliance Ethane Holding Pte. Ltd. (“REHPL”) {incorporated in Singapore, a wholly owned subsidiary of Reliance Industries Limited (“RIL”), having 100% holding in six limited liability companies (LLCs) which own Very Large Ethane Carriers (“VLEC” or the “Vessel”)}, Mitsui O.S.K Lines Ltd. (“MOL”) of Japan and a strategic minority investor signed binding definitive agreements for a strategic investment by MOL and minority investor in the six special purpose limited liability companies (“SPVs”), each owning a VLEC. MOL and the strategic minority investor have completed their strategic investment in the SPVs.

* Reliance Brands Limited (RBL), a subsidiary of the Company, completed the acquisition of 100% stake of Hamleys Global Holdings Limited (HGHL), through a special purpose vehicle company set up in United Kingdom for a cash consideration of GBP 67.96 million. This acquisition will establish RBL as a major player in the global toy retail industry.

Backdrop And Key Operating Highlights:

Operating environment for both downstream businesses, refining and petrochemicals, has been challenging for the previous six quarters. 1Q FY20 was particularly tougher with geopolitical pressures exacerbating crude markets. New supplies, global economic slowdown and trade tensions weighed on product prices and margins.

Reliance’s business model enables it to deliver industry leading profitability despite macro headwinds. Its unique business architecture captures margins within and across hydrocarbon product chain. This is further boosted through appropriate choice of technology, robust automation and world-scale operations which gives Reliance among the best cost positions across its product portfolio. During this quarter, efficient crude and feedstock sourcing, optimizing product yields and maximizing margin capture through chain integration helped Reliance’s downstream businesses deliver resilient performance with near flat EBITDA on Q-o-Q basis.

Despite a slowdown in the FMCG and consumer sector, Reliance Retail continues to grow faster than every other player. Reliance Retail maintained strong growth momentum through expansion across geographies, formats and verticals, reflecting in revenue growth of 48% YoY and EBITDA growth of 70% YoY. Reliance’s growth has been aided by optimum customer value proposition and deep insights into consumer preferences which drives appropriate segmentation and targeting strategy. During the quarter, Reliance Retail crossed the milestone of 100 million register customers and 150 million footfalls, establishing its position as the most preferred retailer in India. Customer centric approach, sourcing and operating cost advantage and benefit of operating leverage helped Reliance Retail deliver record EBITDA for the quarter.

Reliance Jio maintained strong momentum in subscriber addition with gross adds of 33.8 million during the quarter. This translated into revenue and EBITDA growth of 44% and 49% respectively. Despite larger consumer base across varying tariff plans, customer engagement continues to improve with higher data usage of 11.4 GB/user/month. VoLTE voice consumption per subscriber per month stands at 821 minutes.

Reliance has entered into an agreement with Brookfield for investment of ? 25,215 crore in the Tower Infrastructure Trust. This is the single largest foreign investment in an Indian infrastructure vehicle and is a testimony from one of the largest infrastructure players globally, for the quality of assets created by Jio.

This is also a significant step forward in optimizing the capital structure of the digital and infrastructure businesses. The transaction validates the value unlocked through spin-off of passive infrastructure assets of Jio through the InVIT structure.

Consumer businesses now contributes 32% of the consolidated segment EBITDA for the quarter.