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S-Oil posts 17.4% in net profit

S-Oil, South Korea’s third largest oil refiner, posted a net profit increase of 17.4% from a year earlier, to KRW359.3 billion (US$318.9 million) on solid petrochemicals demand. Operating profits was up 6% year-on-year in the last quarter of 2011 to KRW411.8 billion (US$365.5 million). Sales revenue reached KRW9.26 trillion (US$8.2 billion) in the same quarter, up 52.3% from KRW6.08 trillion (US$5.4 billion) in the same period of 2010. For the whole year of 2011, net profit jumped by 70.3% to KRW1.21 trillion (US$1.07 billion), from KRW710.5 billion (US$630.7 million) in 2010. The company’s full-year operating profit almost doubled to KRW1.67 trillion (US$1.4 billion), from KRW859.4 billion (US$762.8 million) in 2010. Full-year sales revenue went up by 55.6% year-on-year to KRW31.91 trillion (US$28.3 billion), compared to KRW20.51 trillion (US$18.21 billion) a year ago. The strong performance in the fourth quarter was attributed to the company’s petrochemical segment, which experience a four-fold jump in operating profits in the fourth quarter to KRW147.3 billion (US$130.7 million), and a 149% spike in sales year-on-year to KRW1.09 trillion (US$967.5 million) during the same period. S-Oil’s mainstay petroleum business experienced a downtrend, with a 67.6% decline in operating profit during the fourth quarter of 2011 to KRW75.1 billion (US$66.6 million). Fourth quarter sales, however, was up 46.6% year-on-year to KRW7.52 trillion (US$6.6 billion). S-Oil, in a statement said, “Margins declined due to falling naphtha and gasoline spreads, despite stronger fuel oil and sustainable middle distillates.” The company said that with the completion of major facility upgrading projects, it plans to reduce capital expenditure in 2012 to KRW258.2 billion (US$229.1 million), from KRW726.7 billion (US$645 million) in 2011. (February 2, 2012)