The SLOVNAFT Group earned profits in the first three quarters of the year, results were improved thanks to exports

22-11-2012 — /europawire.eu/ — SLOVNAFT Group has earned a net operating profit of EUR 50 million excluding the reevaluation of reserves, in the first three quarters of this year. During the same period last year, the company’s loss reached EUR 7 million. The result was positively influenced by a slight improvement in processing and sale margins on the international exchanges as well as by increased sales on international markets, where more than two thirds of Slovnaft production is sold, by more efficient management of production, supply and sales of assets of the company and expense rationalization measures. The SLOVNAFT Group will use this positive result to create a reserve for the following winter season, during which refineries usually have great difficulties in terms of maintaining profitability. The company resources will also be used for planned investments that are planned to exceed EUR 500 million during the next three years.

The Group’s net turnover for the first nine months of 2012 has decreased by 6% to EUR 3.36 billion, due to lower demand for crude oil products in domestic and international markets, as well as due to smaller sales volumes caused by major repair works to production units.

“SLOVNAFT Group’s corporate profits have improved on a year-to-year basis for the 1^st quarter of the year, after being influenced by planned shutdowns and overhauls in the first half of the year. Given the extreme volatility in prices of crude oil, crude oil products, exchange rates, processing and sales margins, we maintain a conservative position regarding the future,” said Oszkár Világi, Chairman of the Board of Directors and General Director of SLOVNAFT, a.s.

The SLOVNAFT Group, in the medium term period, expects the high volatility in financial and commodity markets to remain, no lowering of surplus of crude oil products in the European markets, neither an improvement in the security and economic situation in the world. On the contrary, we can expect further pressure on raw material, energy and other cost growth in the crude oil processing sector.

“Therefore, we will continue to monitor closely our internal costs in the following months. Unfortunately, from the long-term perspective, we will not be able to avoid high volatility in the refinery sector, whose effects we can observe in the SLOVNAFT Group’s economic results. Because of this, we initiated several fundamental changes in the management of our activities within the MOL Group, and the first results of this we expect to observe already in 2013,” Oszkár Világi added.

The SLOVNAFT Group’s capital expenditures in the first three quarters amounted to EUR 109 million, the year-to-year growth increased by about 1/3. More than a half of the investment volume was invested into projects involving increases of production efficiency, sustaining of operating reliability, and improvement of quality in the production process at the refinery. In the years to come, SLOVNAFT together with the transnational mother company MOL Group plans to invest extensively into construction of a new petrochemical unit for polyethylene production, a strategic modernization project, and increase of the transportation capacity of the pipeline connecting Slovakia and Hungary.

In the first three quarters of 2012, Slovnaft has processed 3.98 million tons of crude oil in its Bratislava refinery, which was 13% less than in the same period last year. Lower processed crude oil volume was influenced by greater amount of major repairs and decrease in the demand for motor fuels.

Motor gasoline production has decreased by 5% to 1.04 million tons, in comparison with the first nine months of 2011. Motor diesel oils production has reached 2.06 million tons, decreasing by 16% year-to-year. Petrochemical production has recorded a decrease as well.

The company was operating 209 gasoline stations at the end of September; their number has not changed in comparison with the previous quarter. Slovnaft continued with the reconstruction and modernization its gasoline station network, as well as in building three new gasoline stations on the D1 Highway. These are planned to be placed into service in the last quarter of this year.

The SLOVNAFT Group employed 3,599 people as of September this year, and its gasoline station network has been operated by approximately another 1,700 employees of business partners.

For more information on the results of SLOVNAFT Group visit:

http://www.slovnaft.sk/en/about_slovnaft/for_investors/

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