Colombia Ecopetrol Q3 profit falls on lower sales growth, higher costs

31 October 2012 01:30  [Source: ICIS news]

MEDELLIN, Colombia (ICIS)--Colombia’s state oil company Ecopetrol said on Tuesday that a 22% fall in third-quarter net profit was due to lower sales growth and increased operational costs.

Net profit slumped to Colombian pesos (Ps) 3,220bn ($1.76bn, €1.36bn) from Ps4,150bn recorded in the same quarter last year, the Bogota-based company said during an earnings call with investors.

Third-quarter revenues were at Ps14,200bn, up from Ps14,100bn recorded last year, Pemex said.

Third-quarter earnings before interest, tax, depreciation and amortisation (EBITDA) were Ps6,900bn, down by 10% from the same period last year.

“2012 has been a year in which Ecopetrol and its affiliates and subsidiaries have maintained their rate of growth despite facing new challenges specific to the current industrial environment and our country,” said the company’s chief executive, Javier Gutierrez.

Ecopetrol said that it would maintain its 2012 oil production target of 780,000 bbl/day, despite investors' concerns as to how it would meet these targets.

The company produced an average of 743,000 bbl/day in the third quarter, up by 1.6% from a year earlier.

“Planned production increases in several key fields means our output target will be reached,” said Gutierrez.

The company also said that attacks by Colombian rebel groups on oil infrastructure had decreased significantly in October, meaning reduced disruption to operations.

Experts suggest that the reduction in attacks is because of peace negotiations between the Colombian government and the Revolutionary Armed Forces of Colombia (FARC), which officially started in Oslo on 18 October.

($1 = Ps1,831.40 / $1 = €0.77)

By: Simon West

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