Independent refiner Calumet Specialty Products reported strong income but lower sales for the quarter ending March 31, while South Korean refiner S-Oil reported drops in operating income and revenue for the quarter, compared to year-earlier results.
Calumet Specialty Products Partners LP on May 6 reported net income for the quarter ending March 31 of $75.6 million, up from a $3.4 million loss in the year-earlier period. Sales revenue for the quarter declined 30.3 percent to $414.3 million.
Indianapolis-based Calumet said part of the improvement in net income came from a $44.1 million increase in gross profit. The increase in gross profit was primarily due to the significant decline in crude oil prices leading up to and sustained during the first quarter of 2009, as compared to the rapidly rising crude oil price environment in the first quarter of 2008, said Calumet CEO and President Bill Grube. Partially offsetting the impact of lower crude oil prices was lower sales volumes in lubricating oils, solvents and waxes due to economic conditions impacting customer demand.
Calumets production of specialty products – base oils, waxes, solvents and asphalts – was down for the first quarter, compared to the year-earlier period. In the first quarter, base oil output declined 11 percent to 11,650 barrels per day, solvents decreased 7 percent to 8,267 b/d, and wax production fell more than 46 percent to 1,101 b/d.
Our proactive approach to managing our business in the current economic environment helped us to achieve good performance in the first quarter despite weaker demand for specialty products, Grube said. We are attempting to offset the impacts of this weaker demand by broadening our marketing efforts and focusing on specialty product development. We also plan to continue to increase throughput rates at our Shreveport refinery to more fully utilize its expanded capacity as market conditions dictate. In May 2008, Calumet completed a major expansion at the Shreveport refinery.
S-Oil on May 6 reported operating income of 41.8 billion South Korean won (U.S. $34 million) for the first quarter, down 15.6 percent from 49.5 billion won ($40 million) in the year earlier period.
Revenue for Seoul-based S-Oils lube segment reached 248.9 billion won ($202 million) in the first quarter, down 27.5 percent from 343.5 billion won ($279 million) in the year earlier period.
In its first quarter earnings presentation, S-Oil said it was hopeful that demand coming from China and India for lubes used in automotive and shipping, along with stabilization of the global economy, may help boost the lube segment in the second half of 2009.