The Telegraph
Since 1st March, 1999
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Billion-dollar bottomline for Reliance

Mumbai, April 29: Early this month, the technology companies were busy celebrating their entry into the billion-dollar club in terms of topline. Today, Reliance took several steps forward when it announced a net profit of $1.18 billion (Rs 5,160 crore) for 2003-04.

Reliance thus became the first private sector Indian company to cross the magical $1-billion-mark in net profit. The company now features among the top 150 in the world in terms of net profit. The profits are more than Chevron, Texaco, Mcdonald’s, Sony and Bank of China.

Reliance beat expectations when it announced a 29 per cent rise in fourth-quarter net profit at Rs 1,419 crore compared with Rs 1,101 crore in the corresponding previous period.

However, despite the good performance, the Reliance scrip fell Rs 11.10 to Rs 529.20 on the Bombay Stock Exchange today.

Net turnover during the quarter was placed at Rs 14,108 crore (Rs 12,755 crore) and the operating margins increased during the year to 13.4 per cent from 12.9 per cent due to higher product selling prices, higher volumes and greater focus on speciality products.

Gross turnover was placed at Rs 20,352 crore (Rs 17,679 crore) for the fourth quarter, while for the whole year, it stood at Rs 74,418 crore (Rs 65,061 crore) on a consolidated basis.

Chairman and managing director Mukesh Ambani said, “With economic sentiments improving across the globe and stronger indications of India entering into a high GDP growth phase, we see attractive investments opportunities in the energy chain. We are confident that our growth initiatives will help us deliver superior financial performance on a sustainable basis in the future.”

Vice-chairman and managing director Anil Ambani said the improvement in operating margins and a 30 per cent growth in exports in an environment that saw unprecedented firmness in crude prices apart from import tariff reduction in various products, demonstrated Reliance’s ability to deliver superior financial performance under difficult business conditions.

Surpassing the $1-billion mark in net profits is a unique achievement by a company that is just 26-years old, he said.

Ambani added that in asset terms, Reliance now figures among the top 375 companies globally, ahead of majors like Akzo Nobel, Kodak, Dell Computers and 3M.

In refining and marketing, the overall demand for petroleum products rose 3.4 per cent during the year with a consumption of 107.7 million tonnes.

While high speed diesel, which accounts for nearly 40 per cent of the total demand for petroleum products saw a negative growth of 3.7 per cent in the first half, a positive growth of 6 per cent in the second half saw the year showing a overall growth of 1.5 per cent.

Reliance is now engaged in the process of setting up retail outlets at various locations. It already has the necessary approvals for setting up 5849 outlets in the country.

Reliance has so far set up around 11 outlets and around 400 outlets are now at different stages of completion. At the end of this fiscal, close to 2000 outlets are expected to be operational.

Even as most of these retail outlets will be set up in the western region, Reliance expressed the confidence that the average sales per outlet will be double that of the public sector majors.

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