Unipetrol’s Q3 earnings suffer from unplanned ethylene shutdowns

23 October 2013 10:57  [Source: ICIS news]

LONDON (ICIS)--Unipetrol’s third-quarter petrochemical operating profit declined 26% year on year to koruny (Kc) 195m ($10.4m, €7.6m) from Kc265m in the same quarter of last year, with shutdowns causing weaker sales volumes, the Czech producer said on Wednesday.

Petrochemical sales volumes fell 21% to 366,000 tonnes, comparing the third quarter of this year with the same quarter of 2012, it said.

Unipetrol experienced two unplanned shutdowns of its 545,000 tonne/year ethylene cracker in Litvinov within the second quarter.

However, the company reported that the trend of very solid petrochemical margins seen this year continued in the third quarter.

Again comparing the third quarters, the polyolefin margin increased to €262/tonne from €251/tonne, while the olefin margin reached €353/tonne from €303/tonne, Unipetrol said.

In a comment on the Q3 results, Unipetrol CEO Marek Switajewski said: “The overall macro situation is weaker than everyone on the market expected, Q3 was probably the seventh quarter in a row of Czech economic recession. We also hoped that tax fraud legislation could be implemented faster and also expected some relief on [renewable power charges], which did not happen this year. Last but not least we had some unexpected production problems this year.”

Unipetrol would now find it difficult to achieve its full year 2013 financial targets, Switajewski added.

Overall, Unipetrol, also a refiner, saw a net loss of Kc130m in the third quarter against a net profit of Kc645m a year ago. The company blamed extremely weak refining margins.

Sales revenues fell to Kc24.9bn from Kc28.4bn, Unipetrol added.

Unipetrol is 63% owned by Poland's PKN Orlen oil and petrochemicals group, which reported its own Q3 financial results earlier on Wednesday.

($1 = €, $1 = Kc18.70, €1 = Kc25.77)


By: Will Conroy
+44 20 8652 3214



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