Formosa Petrochemical Corp (台塑石化), the nation’s only publicly traded oil refiner, posted the smallest quarterly profit in a year-and-a-half after shutting plants because of fires.
Net income fell 49 percent from a year earlier to NT$6.8 billion (US$220 million) in the three months ending on Sept. 30. That trailed the average estimate of NT$7.9 billion in a survey of six analysts compiled by Bloomberg and was the lowest since the first quarter of last year.
The number was derived by deducting the six-month profit from the nine-month earnings announced by the company’s parent Formosa Plastics Group (FPG, 台塑集團) yesterday. Lin Keh-yen (林克彥), a company spokesman, declined to comment on the figures when reached by telephone.
“Earnings should improve in the fourth quarter,” Yuanta Securities Co (元大證券) analyst Danny Ho (何耀仁) said. “The decline in profit was caused by the fires.”
The company shut its 540,000-barrel-a-day Mailiao (麥寮) refinery for safety reasons after an oil leak triggered a fire at its No. 2 residue desulfurization unit on July 25. Two of the refinery’s three crude units have since started production. Formosa Petrochemical’s 700,000-tonne-a-year No. 1 ethylene plant, also in Mailiao, has been suspended since a blaze on July 7.
Third-quarter sales fell 12 percent from a year earlier to NT$158.2 billion, after surging 35 percent in the previous quarter, monthly stock exchange filings showed.
Formosa Petrochemical shares closed unchanged at NT$80.8 on the Taiwan Stock Exchange before the earnings announcement. The stock has fallen 1.9 percent this year, compared with the benchmark TAIEX’s 1.2 percent increase.
Nine-month net-income of Formosa Petrochemical fell 3.4 percent to NT$28 billion, parent FPG said. The refiner plans to resume operations at the third crude oil distillation unit in the middle of this month, Lin said on Tuesday.
Also yesterday, FPG said its three other major units reported an increase in earnings in the period between January and last month as economic recovery boosted demand for chemicals and plastics.
The recovery in the global economy bolstered demand for petrochemicals including polyvinyl chloride (PVC), used in construction and consumer goods such as handbags and shoes.
The nation’s economy grew at the fastest pace in more than 30 years in the first half.
FPG subsidiary and PVC maker Formosa Plastics Corp’s (台塑) nine-month net income gained 67 percent to NT$33.2 billion, the parent said. Plastics processor Nan Ya Plastics Corp’s (南亞塑膠) profit more than tripled to NT$32.4 billion. Chemical producer Formosa Chemicals & Fibre Corp’s (台灣化纖) net income climbed 60 percent to NT$33.8 billion.
In the third quarter, Formosa Plastics saw net income climb 43 percent from a year earlier to NT$13.2 billion and Nan Ya Plastics’ quarterly profit climbed 73 percent to NT$11.9 billion, while Formosa Chemicals and Fibre’s net income fell 8.1 percent to NT$11.4 billion.
Overall, the net income of the four biggest units rose 61 percent from a year earlier to a total of NT$127.4 billion in the first nine months of the year, FPG said.
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