Rompetrol Rafinare reports USD 62.7 mln loss in Q1, hit by soaring price of raw materials

Newsroom 17/05/2012 | 14:08

The refining arm of Rompetrol Group, Rompetrol Rafinare, widened its loss to USD 62.7 million in the first quarter of 2012 from a negative USD 11.3 million in Q1 2011, due to increasing prices of oil and finished products and a decrease of refining margin. The turnover rose by 2 percent y/y to USD 1 billion in Q1.

Rompetrol’s figures were impacted by the price volatility of raw materials and increases in exchange rates, along with additional expenditure for working capital. Oil gained 14 percent, while gasoline and diesel were up by 15 percent and 10 percent in Q1, while the refining margin fell abruptly from USD 32 per ton in Q1 to USD 0.49 per ton in Q1 2012. Rompetrol is currently investing in Petromidia to increase refining capacity to 5 million tons per year.

Exports of Rompetrol Refining, which includes Petromidia and Vega refineries, Rompetrol Gas and Rompetrol Petrochemicals, rose by 18 percent y/y to USD 495.5 million in Q1.

Turnover in the refining segment, which operates the Petromidia and Vega Ploiesti refineries, rose by 7 percent y/y to USD 1 billion in Q1, but the lower fuel production and the decrease of refining capacity led to a loss of USD 45.5 million.

Rompetrol sold over 56 percent of the fuel to member countries within the group and also to countries in the CEE such as Turkey and Greece.

The company plans to invest over USD 83 million this year, and more than 40 percent will go for increasing refining capacity. The new plants will become operational this June (a hydrogen facility and a mild hydro cracking plant).

The distribution segment reported a flat turnover of EUR 542.4 million in Q1, and the net loss narrowed by 54 percent y/y to USD 11.4 million due to a decrease of the operating income by 80 percent y/y to USD 1.6 million.

The bad weather in Q1 pulled down the amount of fuel sold by 5.5 percent. The distribution arm Rompetrol Downstream operates 758 fuel stations in Romania, while Rompetrol Gas has 220 LPG stations and 5,000 bottles distribution points and three GPL bottling plants in Constanta, Bucharest and Bacau.

Turnover in the petrochemical segment, represented by Rompetrol Petrochemicals, fell by 33 percent y/y to USD 71.4 million. The operating result dropped in the red at EUR 0.9 million, forcing a loss of USD 4 million. This was triggered by trading volumes which lost 23 percent and a reduction of 30 percent of feedstock processed, on top of which lay worsening market conditions.

Rompetrol will finalize this June the modernization of the high density polyethylene plant, which should improve sales that dropped 22 percent y/y to 50 Kt (kilotons). The amount of processed propylene fell by 2 percent to 32 Kt, while processed ethylene lost 56 percent to 16 Kt.

Total assets of Rompetrol Rafinare gained 6 percent to USD 2 billion, while provisioning slightly decreased to EUR 3 million. The company increased its short-term debt to USD 1.3 billion.

Rompetrol Rafinare shares gained 2.94 percent to RON 0.0315 on late Thursday trading on the Bucharest Stock Exchange.

Ovidiu Posirca

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