S-Oil, Chevron Lanka Post Earnings Jumps


S-Oils base oil business posted a 23 percent gain in operating profit in 2015 despite reduced sales revenue, while Chevron Lankas fourth quarter profit jumped more than 50 percent.

The South Korean refiner said it earned 316 billion won (U.S. $262 million) of operating profit in its base oil sector, up 23 percent from 2014. Its sales revenue of 1.34 trillion won was a 32 percent drop from 1.97 trillion won earned in 2014.

Low oil prices gave an inflection point to the industry climate and the business environment turned favorable, said Bang Juwan, an S-Oil finance official. People started driving more, taking advantage of low oil prices. Demand for high-quality lube base oil was also solid [in 2015] with increased driving mileage of passenger cars.”

In the fourth quarter of 2015, S-Oil recorded 67.9 billion won of base oil operating profit, 4 percent up from the same period of 2014. Quarterly sales revenue was down 41 percent year over year to 258.8 billion won.

Lube base oil marginsremained at a decent level, thanks to a decrease in feed stock prices and solid demand despite low seasonality, the company said in its quarterly report.

On the outlook for 2016, the company said the base oil market will likely continue to see a decent spread, driven by demand growth for high-quality products.

Chevron Lubricants Lanka PLCs fourth quarter profit jumped 53 percent compared to 2014s corresponding quarter, and its revenue climbed 8 percent.

The Colombo-based subsidiary of the United States-based energy giant reported last week that its earnings for the quarter ended Dec. 31 were 1 billion rupees, up from Rs 676 million the year before.

The firms quarterly revenue was just shy of Rs 3 billion, over Rs 2.7 billion in 2014s fourth quarter.

In the full year, Chevron Lankas profit rose 16 percent to Rs 4 billion. Its annual sales were virtually unchanged at around 11.5 billion each year.

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