Oil Refineries Ltd. (TASE:ORL) today published its financial report for the third quarter of 2009. The company posted a net profit of $100 million for the quarter, compared with breakeven for the corresponding quarter of 2008, even though revenue fell 45% to $1.15 billion for the third quarter from $2.62 billion for the corresponding quarter.
Net (adjusted) refining margin per barrel was unchanged from the corresponding quarter at $8.10. The net refining margin in the third quarter was much higher than the $1.60 per barrel benchmark Ural margin in the Mediterranean Basin reported by "Reuters". Oil Refineries attributed the difference to upgrades of its facilities, changes in the crude oil mix it refines compared with Ural crude, continuous operation of its facilities despite the decline in refining during renovations, and end effects in the spot market.
Net margin per ton rose to $60.10 for the third quarter from $58.90 for the corresponding quarter. Accounting margin per ton, before adjustments for derivatives and provisions for the timing of purchases and sales and the fall in value of inventory, rose to $80.40 for the third quarter from $43.60 for the corresponding quarter.
Oil Refineries' refining capacity rose to 197,000 barrels per day during the third quarter from 180,000 barrels per day during the corresponding quarter, following an upgrade.
Located in Haifa Bay, Oil Refineries is Israel's largest refinery. Its new refineries can produce 9.8 million tons of fuel a year.
Oil Refineries CEO Yashar Ben-Mordechai said, "Oil Refineries consistently reports high refining margins compared with the Mediterranean Basin, and the recently procedures that we have implemented greatly contributed to the flexibility and added value of our facilities. We continue to feel the effects of the global crisis. Recovery in the real economy is the key that will lead to higher demand, and we're readying ourselves to maximally exploit this potential. The acquisition of Carmel Olefins will enable us to create immediate synergies through operational optimization and carry out a long-term optimal investment plan. A unique integration of the fuel industry, together with the aromatic and polymers industry gives Oil Refineries a leading standing in a competitive environment."
Ofer Holdings Group subsidiary Israel Corporation (TASE: ILCO) owns 45.08% of Oil Refineries, and Israel Petrochemical Enterprises Ltd. (TASE:PTCH) owns 15.76%. Oil Refineries in currently completing the buyout of Petrochemical Enterprises' stake in Carmel Olefins Ltd., which they own in equal shares.
Oil Refineries' share rose 1.1% in early trading today to NIS 2.18, giving a market cap of NIS 4.32 billion.
Published by Globes [online], Israel business news - www.globes-online.com - on November 11, 2009
© Copyright of Globes Publisher Itonut (1983) Ltd. 2009