MOL takes HUF 30 billion loss for Q3 on refinery shutdown

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Hungary-based oil-and-gas company MOL today reported a third-quarter loss of HUF 30.0 billion because of a write-down on the assets of a refinery it is shutting down. MOL said the HUF 123 billion non-cash one-off impairment booked on the shutdown of its refinery in Mantua, Italy, put it HUF 50.8 billion in the red at operating level.

MOL will begin conversion of the refinery into a logistics hub in January of next year.

MOL acquired the refinery when it bought Italian peer Italiana Energia e Servizi (IES) in 2007.
Revenue was flat at HUF 1.45 trillion, but cost of raw materials and consumables rose 5% to HUF 1.1708 trillion, the consolidated IFRS report shows. Operating costs rose 12% to HUF 1.5008 trillion.

The bottom line was hit further by a HUF 21.7 billion financial loss, well over the HUF 5.0 billion loss in the base period.

Diluted earnings per share came to a negative HUF 339 for the period.

Revenue of MOL’s downstream business edged up 3% to HUF 1.3165 billion, but still generated an operating loss of HUF 92.0 billion. Revenue of the upstream business fell 14% to HUF 155.2 billion and operating profit of the segment was down 41% at HUF 42.4 billion.

The picture was similar for the Q1-Q3 period. MOL’s revenue slipped 1% to HUF 4.0775 trillion, but cost of raw materials and consumables was flat at HUF 3.2982 trillion. Operating costs rose 3% to HUF 4.0517 trillion, causing operating profit to fall 86% to HUF 25.8 billion. Financial losses rose by two-thirds to HUF 47.3 billion. Net income was down 88% at HUF 16.7 billion.

MOL had total assets of HUF 4.6896 trillion at the end of Q3, down 4% year-on-year. Net assets were flat at HUF 2.2255 trillion. Non-current liabilities stood at HUF 1.1163 trillion.

Chairman/CEO Zsolt Hernádi highlighted in the report MOL’s “strong balance sheet position which ensures wide room for potential inorganic steps.”

“We are focusing on a more active portfolio management approach, especially in Upstream, to create near-term growth potential,” he said.

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