Essar Energy reports first-half profits tumble

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Indian group Essar Energy reported slumping interim profits on Thursday in the group's first results statement since floating on the London stock market earlier this year.

Earnings before interest, tax, depreciation and amortization (EBITDA) sank 25 percent to 320.2 million dollars (250 million euros) in the six months to June.

Net profit meanwhile tumbled 19 percent from a year earlier to 91.1 million dollars.

The group said the fall in earnings reflected the comparison with strong year-earlier figures which were boosted by oil inventory gains and higher retail marketing profits.

Revenues meanwhile soared 66 percent to 4.76 billion dollars in the first half, largely because of increased volumes and higher prices in its refinery business.

"The first six months of 2010 were a pivotal period with the creation of the company and its successful flotation on the London Stock Exchange," vice chairman Prashant Ruia told a conference call

"We have seen tremendous interest in the growth of India's energy demand and our strategy for meeting that growing need."

Essar Energy was listed on the London stock market by parent and Indian conglomerate Essar, which retained a majority 76-percent stake.

The initial public offering (IPO) in May raised 1.85 billion dollars, which it has mostly ploughed into new growth projects.

The IPO, the largest international listing in London since 2007 and the biggest-ever overseas share offer by an Indian company, catapulted Essar Energy into the prestigious FTSE 100 index of top blue-chip companies.

Ruia also said Thursday that the group remained in talks with British energy giant Royal Dutch Shell over the purchase of three European refineries.

- Dow Jones Newswires contributed to this report -

© 2010 AFP

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