Motor Oil Returns to Profit in Q4, Beats Forecast
Greece's second-biggest refiner Motor Oil said it swung to a fourth-quarter profit, beating analysts' forecasts, helped by higher output, exports and a one-off capital gain.
Net income was €64 million ($89.25 million), compared with a forecast for a 32.7 million profit in a Reuters poll and after a net loss of 17.5 million a year earlier.
A new distillation unit, which started operations in May, helped production volume rise 29% to 2.44 million metric tons, the company said on Wednesday.
Export volumes to Mediterranean countries, such as Turkey, rose 52% to 1.68 million metric tons. At the same time, sales to the recession-hit domestic market dropped 4.7% at 878,000 metric tons.
One-off items also helped, as the company booked a €31.8 million accounting gain from the acquisition of Shell's gas station network in Greece in the second half of last year.
"Higher refining volumes and the one-off capital gain made the difference," said Nikos Katsenos, an analyst at Alpha Finance.
Motor Oil has been expanding into the retail gas station market while upgrading its sole refinery near Athens to produce higher-value products that are easier to export.
The company plans to distribute a dividend of 25 cents a share on 2010 earnings, lower than 70 cents paid last year, it said in its annual financial report. But it also plans to return capital to shareholders, it said without elaborating.
Motor Oil's need for working capital has increased as debt matures and oil prices rise. The company earlier this week got shareholder approval to sell bonds of about €400 million.
