Bloomberg News

PKN Orlen Headed for Week-Low as Zloty’s Slump Spurs Loan Losses

October 04, 2011

Oct. 4 (Bloomberg) -- PKN Orlen SA headed for its lowest close in a week as Poland’s biggest oil refiner said it will post losses of “several hundred million” zloty from the revaluation of foreign-currency debt after the country’s currency slumped.

The shares tumbled as much as 7.1 percent to 32.5 zloty and traded 4.6 percent lower at 33.4 zloty by 11:34 a.m. in Warsaw, extending this year’s decline to 27 percent. Grupa Lotos SA, the country’s second-largest refiner, lost 5.1 percent to 22.74 zloty, while Poland’s benchmark WIG20 Index fell 3.4 percent to 2,073.62 today.

Orlen, based in Plock, central Poland, will book the financial losses in the third quarter, Chief Financial Officer Slawomir Jedrzejczyk said today.

The Polish zloty lost 10 percent of its value against the euro and 17 percent against the dollar in the July-September period, making it the worst performing currency tracked by Bloomberg last quarter.

Orlen, whose first-half net income was 2 billion zloty ($601 million), had net debt at 7.9 billion zloty at the end of June, according to a presentation on its website. Eighty-six percent of its gross debt was denominated in euros and dollars, the presentation showed.

--Editors: Wojciech Moskwa, Alex Nicholson

To contact the reporter on this story: Pawel Kozlowski in Warsaw pkozlowski@bloomberg.net

To contact the editor responsible for this story: Gavin Serkin at gserkin@bloomberg.net


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