Reliance Industries Limited announced fall in Oil to Chemicals segment (O2C Limited) earnings for full-year 2020-21 due to lower margins and weak demand.
Fourth Quarter YoY:
4Q FY20 revenue from the Oil to Chemicals segment increased by 4% Y-o-Y to Rs 1010.8 billion ($ 13.6 billion) as against Rs 967.32 billion ($ 13.03 billion) in prior year quarter.
Oil to Chemicals segment EBITDA was at Rs 114.07 billion ($ 1.53 billion), down 5% Y-o-Y compared to Rs 119.6 billion ($ 1.53 billion) in prior year quarter, with significant decline in margins.
Full-Year:
FY20 revenue from the Oil to Chemicals segment decreased by 29% to Rs 3200.08 billion ($ 43.1 billion) due to lower price realizations with weaker demand.
Oil to Chemicals segment EBITDA was at Rs 381.7 billion ($ 5.14 billion), down 29% as compared to previous year’s Rs 538.03 billion ($ 7.25 billion), due to lower margins in key products – Paraxylene, MEG, PET, Polypropylene and Polyethylene.
“We have registered robust recovery in O2C segment…. Sustained high utilization rates across sites and improvement in downstream product deltas as well as transportation fuel margins aided O2C earnings growth,” said Mukesh Dhirubhai Ambani, Chairman and Managing Director, RIL.
In February, the Mukesh Ambani-led conglomerate announced reorganisation of its oil-to-chemical (O2C) business into a wholly-owned subsidiary – Reliance O2C Limited. The O2C business comprises refining & marketing and petrochemicals businesses.