Slovnaft swings to Q4 loss on lower polymer margins

24 February 2012 12:22  [Source: ICIS news]

LONDON (ICIS)--Slovnaft swung to a €44m ($58.7m) net loss in the fourth quarter of 2011, against a net profit of €18m in the same period a year before, as polymer margins fell, the Slovakia-based refiner and petrochemical producer said on Friday.

Petrochemical sales revenues for the quarter fell 12% year on year to €131m, although overall sales revenues rose 19% to €1.17bn on the back of stronger results from the group's refining business, it added.

The company's integrated petrochemical margin averaged €177/tonne in the fourth quarter, 35% lower than in the same period a year before and 17% less than in the third quarter of 2011, Slovnaft said.

“The integrated margin decline was influenced mainly by the level of quoted polymer prices that reached the lowest values during Q4 2011,” it added.

Polymer product prices did not follow the higher prices of raw materials for petrochemical production, Slovnaft said.

In a commentary on the financial results, Slovnaft CEO Oszkar Vilagi said: “We are cautious regarding global refinery industry trends, therefore we are focusing on efficiency improvement projects in order to maintain the company’s performance even in this depressed environment."

“One of these projects is an investment into a new LDPE [low density polyethylene] unit which is scheduled to come into operation in 2015," he added.

“With this investment we are not only aiming to improve our refining-petrochemical integration flexibility, but also to utilise the opportunities of an extended value chain,” Vilagi said.

Slovnaft is owned by Hungary-based MOL group, which reported its own results earlier on Friday.

($1 = €0.75)

By: Will Conroy
+44 20 8652 3214

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