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.


© Scoop Media

Business Headlines | Sci-Tech Headlines


Shocking Dairy Footage: MPI Failing Our Animals And Damaging Our Reputation

Greens “Nathan Guy needs to urgently look into how his ministry is enforcing animal welfare standards, how these appalling incidents happened under its watch and what it’s going to do prevent similar incidents happening again in the future." More>>


Land & Water Forum: Fourth Report On Water Management

The Land and Water Forum (LWF) today published its fourth report, outlining 60 new consensus recommendations for how New Zealand should improve its management of fresh water and calling on the Government to urgently adopt all of its recommendations from earlier reports. More>>



Welcome Home: Record High Migration Stokes 41-Year High Population Growth

New Zealand annual net migration hit a new high in October as more people arrived from than departed for Australia for the first time in more than 20 years. More>>


Citizens' Advice Bureau: Report Shows Desperate Housing Situation Throughout NZ

CAB's in-depth analysis of over 2000 client enquiries about emergency accommodation shows vulnerable families, pregnant women and children living in cars and garages, even after seeking assistance from the Ministry of Social Development and Housing New Zealand. More>>


Speaking For The Bees: Greens Call For Neonicotinoid Pesticide Ban

The National Government should ban the use of controversial pesticides called neonicotinoids after evidence has revealed that even at low doses they cause harm to bee populations, the Green Party said today. More>>


Get More From Scoop

Search Scoop  
Powered by Vodafone
NZ independent news