SK Lubricants posted operating profit of 113.8 billion Korean won (U.S. $94.4 million) for the fourth quarter of 2015, up 59.4 percent from 71.4 billion won in the year-earlier period. For the full fiscal year, operating income reached 295 billion won, up 1.6 percent from 290.3 billion won in 2014.
The lubricants business reported 680.6 billion won in revenue for the quarter, down 14.8 percent from 799.1 billion won in 2014s fourth quarter. For the full fiscal year, revenue reached 2.6 trillion won, down from 3 trillion won in 2014.
The operating profit jumped as weak oil prices led to higher base oil margin and sales volume expanded, the company stated in its earnings news release. The base oil margin is expected to be stable as the demand for premium base oil gradually rises.
SK operates a 40,000 barrels per day API Group II/III base oil plant at its refinery complex in Ulsan, South Korea, which includes a 26,000 b/d joint venture base oil plant built by SK Innovation with JX Nippon Oil & Energy.
Seoul-based SK Lubricants also has a joint venture plant with Pertamina in Dumai, Indonesia, with 10,000 b/d of Group III capacity, and has partnered with Repsol on a 12,900 b/d Group II/III plant that opened in Cartagena, Spain.