Comments
Oil producer Cairn India’s poor run continued in the recent March quarter. The company posted a consolidated loss of ₹241 crore as against profit of ₹3,035 crore in the March 2014 quarter. An impairment loss of ₹505 crore on the company’s Sri Lanka asset dragged the company into loss. But even excluding this, the profit was more than 90 per cent lower than in the year-ago period. Revenue dipped 47 per cent.
Blame this primarily on the rout of crude oil. Cairn India’s price realisation at about $48 a barrel oil equivalent in the March quarter was nearly half over the period last year.
It did not help that the company’s production fell 7 per cent compared with the year-ago period. Rise in exploration costs and higher exploration cost write-offs were also a drag.
The company is going through a rough patch. Consolidated revenue in 2014-15 is down about 22 per cent while profit has fallen two-third. With oil prices languishing, the company has slashed capital expenditure — this will impact output growth. To add to the troubles, the taxman recently asked the company to cough up ₹20,495 crore for alleged failure to deduct tax on gains made by erstwhile parent Cairn Energy Plc. The stock has lost 35 per cent over the last year.
Comments
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.