Formosa Petrochemical Corp (台塑石化) yesterday reported the largest drop in monthly revenue among the Formosa Plastics Group’s (台塑集團) four core companies, stock exchange filings showed yesterday.
The refiner said in the filing that its revenue last month fell 56.8 percent sequentially to NT$33.27 billion (US$1.14 billion) because the recent partial shutdowns of its refining units in Mailiao Township (麥寮), Yunlin County, affected its factory utilization and oil products sales.
On an annual basis, Formosa Petrochemical’s revenue dropped 29.6 percent, the filing showed.
“[Our] refinery plants stopped operating for 20 days last month because of several industrial safety mishaps over the past year, causing oil products sales to drop 76 percent from the previous month,” the company said.
“Meanwhile, sales of petrochemical products such as ethylene and propylene also fell last month from the previous month as the No. 3 naphtha cracker began its annual maintenance in the middle of August,” it said.
Formosa Petrochemical runs three crude distillation units in Mailiao and the refinery accounts for nearly 70 percent of its total sales. It also operates three naphtha crackers there, accounting for about 25 percent of total sales.
The group was forced to partially suspend production at the Mailiao petrochemical complex following a series of fires since July last year.
Formosa Petrochemical said its refinery revenue would recover this month as the company “has restarted two of three crude distillation units in Mailiao,” local cable TV network UBN quoted outgoing president Su Chi-yi (蘇啟邑) as saying.
“We expect the refinery plants to process up to 400,000 barrels a day of crude oil this month,” Su was quoted as saying.
Last week, the company told analysts via a conference call that it expected to “resume all operations — including three refinery plants and three naphtha crackers — by the end of this month,” Credit Suisse analyst Sidney Yeh (葉昌明) said yesterday in a client note.
After operations restart, the plants will be subject to close government inspection, Yeh said, adding that he expected utilization for the refineries to be around “65 percent to 70 percent for the third quarter and [to] improve to 80 percent or above in the fourth quarter.”
The lower feedstock supply from Formosa Petrochemical also impacted its affiliates.
Formosa Plastics Corp (台塑), the group’s flagship company, saw sales last month fall 6.8 percent month-on-month to NT$15.82 billion and 12 percent year-on-year, while Formosa Chemicals and Fibre Corp (台灣化纖), which produces aromatics and styrenics, reported a revenue drop of 7.7 percent to NT$21.64 billion from the previous month and a decline of 3.7 percent from a year earlier.
Nan Ya Plastics Corp (南亞塑膠), the nation’s largest plastics maker, bucked the trend and reported a sequential revenue rise of 10.1 percent to NT$15.6 billion last month, but sales were down 17.3 percent from one year ago, its filing showed.
Overall, the group’s four core companies posted a combined revenue of NT$86.3 billion last month, down 34.4 percent month-on-month and 19.36 percent year-on-year. Revenues in the first eight months of the year reached NT$1.02 trillion, up 3.4 percent from a year earlier.
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