Formosa Petrochemical Corp (台塑石化), the nation’s only listed oil refiner, yesterday said it expected earnings to grow on the back of a stable global economic recovery and sufficient capacity.
“The market sentiment has been quite good so far this year,” chairman Chen Bao-lang (陳寶郎) said at the company’s annual shareholders’ meeting in Taipei.
The optimistic forecast came after Formosa Petrochemical reported revenue of NT$50.39 billion (NT$1.67 billion) for last month, up 1.9 percent from a year earlier and 19.2 percent from a month earlier.
From January through last month, revenue totaled NT$257.1 billion, up 18.72 from the same period last year, thanks to rising customer demand and higher oil prices.
With the company operating at full capacity, it expects its gasoline and diesel sales to reach 5.96 billion liters and 10.33 billion liters respectively this year.
Asked if the political tension between Qatar and several Arab states would affect market sentiment, Chen said it is likely to have a limited impact on international oil prices, citing the country’s little contribution to global oil supply.
Qatar has a crude oil capacity of about 500,000 barrels per day, compared with the global total of 90 million barrels, Chen said.
However, he said that global oil refiners might face transportation problems after several Gulf nations set limits on oil tankers sailing to and from Qatar.
Crude oil prices are forecast to reach about US$55 per barrel this year, Formosa Petrochemical president Tsao Minh (曹明) said at an earnings conference on Tuesday.
At yesterday’s meeting, shareholders approved a company proposal to distribute cash dividends of NT$6 per share, the second-highest level in the 25-year-old company’s history, based on last year’s net profit of NT$75.76 billion, or NT$7.95 per share.
That translates into a dividend yield of 5.66 percent, based on Formosa Petrochemical’s closing price of NT$106 yesterday.
For the whole of last year, the company posted sales of NT$54.6 billion, down 13.2 percent from NT$62.95 billion a year ago.
However, net profit surged 60.2 percent to NT$75.76 billion from NT$47.3 billion the previous year, company data showed.
Formosa Petrochemical attributed the strong earnings performance to improving customer demand worldwide and falling supply from its Asian competitors due to cracker maintenance.
Formosa Petrochemical shares yesterday fell 0.93 percent in Taipei trading before the meeting, underperforming the broader market, which edged up 0.15 percent.
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