Hindustan Petroleum Corp (HPCL) on August 7 reported a 53 percent drop in June quarter net profit mainly due to inventory losses caused by fall in oil prices and decline in refinery margins. Net profit slipped to Rs 811 crore in April-June as compared to Rs 1,719 crore a year back, the company's Chairman and Managing Director Mukesh K Surana told reporters here.
"The decrease in profit is due to sharp decline in crude prices in the month of May and June 2019 leading to inventory loses both at refinery and marketing, and also lower average cracks for all products except for LPG and fuel oil," he said.
Also, there was reduced throughput at refineries due to planned shutdown which impacted profits.
HPCL earned $0.75 on turning every barrel of crude oil into fuel in Q1 of the current fiscal as compared to $7.15 per barrel gross refining margin (GRM) earlier, he said.
Sales increased marginally to Rs 74,530 crore in April-June as against Rs 72,923 crore turnover a year back.
During April-June, HPCL fuel sales grew 1.7 percent to 9.82 million tonnes. Petrol sales increased 8.4 percent while diesel sales rose 1.7 percent.
"The GRM were lower because of shutdown taken at our refineries," he said.
Surana said HPCL suffered an inventory loss of Rs 535 crore in Q1 as compared to an inventory gain of Rs 2,332 crore a year back.
Discover the latest business news, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
