2nd UPDATE:Neste Oil Sees Challenging 2010;Books 4Q Net Loss
04 Febbraio 2010 - 10:05AM
Dow Jones News
Neste Oil Oyj (NTOIY) Thursday said refining markets are likely
to remain challenging in 2010 and it expects margins to increase
only gradually as it reported a below-forecast net loss for the
fourth quarter of 2009.
The Finnish oil refining company said the slow demand recovery,
new capacity due to come onstream in 2010 and high petroleum
product inventories will weigh on a recovery in refining
margins.
"It is likely that refinery utilization rates will be limited
globally and that more capacity will be closed either temporarily
or for good," Neste Oil said.
The company booked a fourth quarter net loss of EUR1 million, an
improvement on the EUR290 million loss of the same period of 2008,
but below a Dow Jones Newswires poll of six analysts which pointed
to a profit of EUR31.03 million.
The result was impacted by lower sales as the refining margin
slumped to $5.85 a barrel from $15.05 a barrel a year ago, and a
series of negative non-recurring items including costs relating to
job cuts announced in late 2009.
Chief Executive Matti Lievonen said: "The refining industry had
a very difficult year in 2009, which was reflected clearly in our
result. A virtually unprecedented drop in oil demand, coupled with
increased new refining capacity, led to lower refining margins
compared to recent years."
Lievonen said 2010 "appears to be another challenging year due
to the slow pace of economic recovery."
Revenue was at EUR2.49 billion compared with EUR2.81 billion a
year ago, and the loss per share for the period was EUR0.01 from a
loss of EUR1.14 a share in the fourth quarter of 2008.
The company proposed a dividend of EUR0.25 a share for 2009.
Analyst Henri Parkkinen of Pohjola Bank said Neste Oil's fourth
quarter comparable operating loss of EUR29 million was weaker than
expected due to the company's difficulties in its refining unit.
"The dividend was also below our estimates and the outlook for 2010
was not very promising," he added.
Neste said it has built up a stockpile of 570,000 tons of
gasoline and middle distillates to replace lost output volumes
during a planned, second quarter turnaround at the Porvoo refinery
in Finland. The sale of the stored products will have a positive
impact on operational cash flow, it said.
But the storage build-up depressed fourth quarter cash flow from
operations by around EUR250 million, leading to net cash from
operations of negative EUR225 million. That compares to positive
net cash of EUR486 million in the fourth quarter of 2008.
In its outlook, Neste Oil said diesel and middle distillate
margins have strengthened somewhat during January 2010 due to cold
weather and normal seasonal demand. But it ceded that margins are
not expected to increase significantly before current high onshore
and floating inventories levels have been drawn down. "This is
expected to take at least six months, depending on how demand
develops," the company forecast.
The company's Renewable Fuels unit is expected to report
negative results until sales volumes increase materially in the
last months of 2010 when a new plant in Singapore is due
online.
Full year 2010 fixed costs are expected to be on a similar level
to 2010 and cash investment is anticipated at around EUR920 million
of which strategic investments account for EUR580 million,
maintenance investments EUR310 million and productivity investments
EUR30 million.
Neste Oil closed at EUR11.65 Wednesday, off the previous
12-month peak of EUR13.22 reached in October following news of
layoffs. The shares had made a steady recovery from July up to that
point, but fell again after the October high as depressed refining
markets continued to weigh on a more sustained recovery.
Company Web site: www.nesteoil.com
-By Elizabeth Adams, Dow Jones Newswires; +44 (0) 20 7842 9386;
elizabeth.adams@dowjones.com
Grafico Azioni Neste OYJ (PK) (USOTC:NTOIY)
Storico
Da Ago 2024 a Set 2024
Grafico Azioni Neste OYJ (PK) (USOTC:NTOIY)
Storico
Da Set 2023 a Set 2024