Czech Republic's Unipetrol downgraded on weak polymer demand

25 February 2009 15:19  [Source: ICIS news]

PRAGUE (ICIS news)--Equities house KBC Securities said on Wednesday that it had downgraded Czech petrochemical company Unipetrol to 'Sell' because of continuing weak demand for polymers.

“Our pessimism on Unipetrol is fuelled by our negative stance on petchem margins. We expect weak demand for polymer from the troubled automotive and construction industries to weigh on petchem margins in 2009,” KBC said.

Unipetrol is set to report its earnings for the fourth quarter of 2008 on Thursday.

“We expect the company to report a net loss of koruna (Kc) 1.1bn [$49.9m/€38.9m] for the period versus a profit of Kc556.6m in 3Q08 and a Kc558m loss in 4Q07,” said the equities house.

KBC added that according to trading data made available by the company’s Polish owner PKN Orlen, Unipetrol’s “petchem sales volume stood at 329,000 tonnes in 4Q08, down 16.9% on the previous quarter due to significant de-stocking by buyers, which caused a sharp fall in demand”.

($1 = Kc22.05, €1 = Kc28.31)

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By: Will Conroy
+44 20 8652 3214



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