Bloomberg News

Unipetrol Sees Negative Third-Quarter EBIT on Outages

October 21, 2011

(Updates with crude oil throughput in third paragraph, refinery margins in fourth, fuel sales in fifth.)

Oct. 21 (Bloomberg) -- Unipetrol AS, the largest Czech refiner, will report negative earnings before interest and tax in the third quarter as petrochemical sales dropped and an outage at its Litvinov refinery curbed production.

The loss will wipe out second-quarter earnings, the company said today in a trading statement posted on its website. Unipetrol, controlled by Polski Koncern Naftowy Orlen SA, will book a charge of 230 million koruna ($12.7 million) from a fine it has to pay the European Commission.

Crude oil throughput dropped 15 percent in the quarter when compared with the previous three-month period, and declined 20 percent from the year-ago period, according to the statement.

Sales of petrochemicals fell 10 percent in the quarter from the previous three-month period, the company said. PKN holds 63 percent of Unipetrol.

The Brent-Urals differential, or the difference between prices of higher-quality Brent crude and Urals oil which Unipetrol uses as a profitability gauge, narrowed to 0.7 from 2.9 in the previous quarter, curbing profits from refining.

Sales of fuels fell 1 percent in the quarter and declined 9 percent from the year-ago period as high gasoline and diesel prices prompted more Czechs to buy fuels in neighboring countries, Unipetrol said.

Unipetrol’s expenditures in the third quarter rose to 800 million koruna because of repair costs during the refinery outage, it said.

--Editor: Douglas Lytle

To contact the editor responsible for this story: Ladka Bauerova at lbauerova@bloomberg.net


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