Hungary's MOL petchem unit posts $46m operating loss in Q1

15 May 2012 03:02  [Source: ICIS news]

LONDON (ICIS)--MOL's petrochemical division posted a forint (Ft) 10.5bn ($46m, €36m) operating loss in the first quarter of 2012, compared with a Ft 2.7bn operating profit a year ago, as margins eroded to an all-time low, the Hungarian group said on Tuesday.

Its polymer sales volume declined by 23% year on year during the quarter to 236,000 tonnes, while olefin sales volume rose by 7% to 92,000 tonnes, MOL said in a statement.

MOL's integrated petrochemical margin sank to a historical low in January, and during the quarter plunged by 54% to €173/tonne ($222/tonne), the group said.

“The year of 2012 is expected to be a challenging year especially when considering the announced force majeure [declared on MOL's oil operations] in Syria or the tough refinery and petrochemical environment,” said MOL CEO Zsolt Hernadi.

“Nevertheless, we believe the MOL Group is well positioned to realise outstanding mid-term growth,” he said.

“As a response to the extremely depressed downstream business environment, a comprehensive program has been designed and launched in order to increase the profitability of the downstream division [which includes the petrochemicals operations], which will ensure the leading position of our core assets in the future, too,” Hernadi said.

“The new program aims to reach a $500-550m EBITDA [earnings before interest, tax, depreciation and amortisation] improvement in the upcoming three years,” he added.

Meanwhile, the firm’s integrated petrochemical margin improved significantly in April, MOL said, without giving a figure.

Overall, MOL, an integrated oil, gas and petrochemical group, saw a first-quarter net profit of Ft73.7bn, a 20% reduction from the bottom line recorded in the same period of 2011.

Its net sales rose by 15% year on year to Ft1,300bn.

($1 = Ft228, $1 = €0.78)

By: Will Conroy
+44 20 8652 3214

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