GAIL takes a hit with poor Q4 results
NEW DELHI, May 23, 2017 – India’s gas transmission and marketing company GAIL saw its shares tumble on Tuesday after reporting a major impairment charge that brought down its performance in Q4 of the 2016/17 financial year, which ended in March.
GAIL’s shares were down more than 6.6% on Tuesday, local media reported, as quarterly profits declined by 69% to INR 2.6 billion (USD 40.3 million) year-on-year even though key business segments reported growth and overall performance remained in the black. The company’s profit after tax for the full year was up 57%, at INR 35 billion (USD 542 million).
“The company registered growth in physical performance in FY 2016-17 in all segments on year-on-year basis,” GAIL said in a press release. “Sale of Petrochemicals was up by 73%, Natural Gas Marketing & Transmission volumes rose by 10% & 9% respectively, LPG Transmission volume was up by 19% while Liquid Hydrocarbon Sales went up by 2%.”
Fourth-quarter results were impacted by an INR 7.83-billion (USD 121-million) investment loss in Ratnagiri Gas and Power, a JV with energy conglomerate NTPC, which according to a report in the Financial Express newspaper “has initiated the process of the demerger of its business into two separate companies.”
GAIL has reportedly invested INR 9.74 billion (USD 151 million) in the JV and holds a 25.51% stake in it.