Unipetrol - Q4 revenues higher by 11% y/y

Company posted an operational result (EBIT) of CZK -2.55bn, with revenues of CZK 24.327bn (+11% y/y) in 4Q11. During the period company recorded net result of CZK -3.14bn. Unipetrol Group succeeded in continuing its strict cost management as one of its priorities for this year. The Group decreased its fixed costs by over CZK -200m y/y in 2011.

„Our businesses were hard hit by the difficult situation in macro environment. We face reduced demand for motor fuels and other types of refinery products. The Brent-Ural differential narrowed by -80 % and differential between Brent and Other sweet crude oils has also significantly deteriorated. Unipetrol model refining margins declined for 80% y/y in 4Q2011 and Combined model petchem margins reached the lowest average values since 2010," said the CEO and Chairman of the Board of Directors of Unipetrol, Piotr Che³miñski, adding: „We are responding to the unfavorable economic situation by cutting back on our fixed costs and by optimizing the use of our production capacities. For example, we are currently working on more closely tying together the businesses of Paramo and Unipetrol RPA. "

The retail segment recorded a positive EBIT of CZK 64m in 4Q11, what represents 42% decline y/y. This result was affected by lower gasoline and diesel sales and worse fuel unit margine. With regard to the warmer weather, compared to the end of 2010, there was a lower sales in the premium fuels category (VERVA). On the other hand, segment results were positively influenced y/y by decrease of fixed costs and higher non-fuel sales.

In the refinery segment the volume of processed crude oil decreased by 11% y/y, from 1,141 kt in 4Q10 to 1,010 kt in 4Q11, as the nominal utilisation ratio reached 80%. The refinery segment recorded EBIT of CZK -1.905bn in 4Q11. The reason was mainly one-off impairment of fixed assets of PARAMO and ongoing shutdown at Chempark in Litvinov. Group sales of refinery products declined (-6% y/y) in 4Q11. The sales were down mainly on diesel and fuel oil, however gasoline sales improved by +10% y/y thanks to higher wholesale sales in domestic market. Performance of the refinery segment was also negatively affected by higher differential between Brent and other sweet crude oils which almost doubled y/y. On the other hand, the segment was positively influenced y/y by positive FX effect of CZK/USD weakening and lower fixed costs.

EBIT in the petrochemical segment amounted to CZK -696m in 4Q11. Group sales of petrochemical products declined (-15% y/y) in 4Q11, mainly due to polymers sales (-15 % y/y) and agro products (-25% y/y).  On the other hand, sales of ethylen reached relatively high dynamics (-3% y/y). Performance of this segment was influenced by lower combined petchem margins (-11%). Positive effect generated decrease of fixed costs.

Unipetrol, as part of the activities supporting the International year of chemistry in the Czech Republic, launched the http://www.zazijchemii.cz/ interactive website, aimed at pupils and students of elementary and high schools. The portal uses entertaining videos, instructions for experiments and quizzes to introduce chemistry to pupils as an entertaining and attractive field. The project can also be used as a tool by chemistry teachers.