RPT-WRAPUP 1-PKN, Lotos earnings beat f’casts on inventory gains
August 13th, 2008 | by admin |(Combines PKN, Lotos, Unipetrol)
WARSAW, Aug 13 (Reuters) - Polish refiners PKN OrlenPKNA.WA and Lotos LTOS.WA posted forecast-beating quarterlyearnings on Wednesday thanks to inventory gains from surgingcrude oil prices and rising refining volumes.
PKN’s net profit jumped 46 percent to 1.67 billion zlotys($757 million) and above the 1.27 billion expected by analysts.Lotos boosted earnings by 66 percent to 396.5 million zlotys,topping a forecast of 278 million in a Reuters poll.
“The results are much better, so despite yesterday’s gainsboth stocks should outperform the market today,” said PawelBurzynski, analyst at BZ WBK brokerage.
PKN’s operating profit benefited from 845 million zlotys ininventory revaluations, an accounting adjustment of the value ofoil stockpiles held by the company depending on crude prices.Lotos booked 211 million zlotys in such gains.
PKN, Poland’s largest oil company, boosted its productionvolumes after its Lithuanian unit Mazeikiu facility reached fullcapacity, which helped make up for weaker refining margins.Revenues rose by 37 percent to 21.6 billion zlotys.
The net profit at Lotos also benefited from financial gainsfrom hedging against the strengthening zloty which added another139 million zlotys.
The Gdansk refiner relies more than its bigger rival ondiesel production, which allowed Lotos to improve refiningmargins despite the negative effect of the surging zloty.
The negative effect of a different product mix and currencyappreciation reduced PKN’s operating profit by about 470 millionzlotys, it said.
