Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


High dollar, tight margins push NZ Refining to annual loss

High dollar, tight margins push NZ Refining to full year loss

Feb. 28 (BusinessDesk) – Refining NZ, operator of New Zealand’s only oil refinery, has reported a loss for the year to Dec. 31 of $5.0 million, reflecting the impact of a strong local currency and volatile margins caused by the global over-supply of refining capacity.

Gross refining margins for the year averaged US$4.58 per barrel of oil, compared with US$5.77 the previous year, and the company is predicting “tough” trading conditions in the current financial year also.

No final dividend was declared, making the two cents per share interim dividend the total for the year. The shares have fallen 26.3 percent in the last year, closing yesterday at $1.88.

The company had outperformed against its own target of $4 million in savings, achieving cost reductions of $6 million and was confident of achieving another $7 million in savings in the current financial year.

However, there was a global trend for refineries that had invested in upgrades and new facilities facing reduced demand “just as those new production facilities are coming online,” said chairman David Jackson in a statement to the NZX.

The Marsden Point refinery, near Whangarei, is in the midst of its own major upgrade.

The North American shale gas revolution was also having an impact, with cheap natural gas “giving US refiners a cost advantage that has revitalised their refining and petrochemicals industry,” he said. “The other factor in this result is the continuing strength of the New Zealand dollar, which average 82 US cents and impacted our processing fee income.

“Given the strength of the dollar and the state of global refining, we fully expect refiners’ margins to remain volatile in 2014,” Jackson said. “We expect business conditions in 2014 to remain difficult.”

Total income for the year of $223.2 million was down markedly on the previous year’s $278.5 million, while total expenses were similar, at $228.8 million ($232.2 million in 2012). The latest year’s $5.0 million loss compares with an after-tax profit of $31.1 million the previous year.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Scoop Business: NZ Wool Exports Jump To The Highest In More Than A Decade

New Zealand wool exports jumped to their highest level in more than a decade in June, aided by a lower currency and strong demand from China, the nation’s largest market. More>>

ALSO:

Surreal Estate: Home Values Rise At Fastest Rate In Seven Years

The latest monthly QV House Price Index shows that nationwide residential property values for July have increased 10.1% over the past year which is the fastest annual rate since 2007... The Auckland market has increased 18.8% year on year. More>>

ALSO:

New Employment Laws: Talley’s AFFCO Workers To Strike

The decision comes after the Talley’s owned company walked away from mediation last week and applied to end bargaining under the government’s new employment laws - the first such application since the law came into effect. More>>

ALSO:

Private Action: Employer Pleads Guilty Over Forestry Death

The CTU has always known that the death of forestry worker Charles Finlay was due to the poor health and safety practices of his employer... "The CTU, with the support of Charles’s family, needed to take this ground breaking private prosecution." More>>

ICT Innovation: Six NZ Finalists In World Summit Awards

The awards are a global showcase of 40 projects, across eight categories, with a special emphasis on those which show the benefits of information and communication technology for the development of communities. New Zealand has finalists in six of the eight categories. More>>

ALSO:

Final Frontier: Rocket Lab And NASA Sign Commercial Space Launch Agreement

Rocket Lab has signed a Commercial Space Launch Act Agreement with the National Aeronautics and Space Administration (NASA). The agreement enables Rocket Lab to use NASA resources - including personnel, facilities and equipment - for launch and reentry efforts. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news