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Title SK INNOVATION REPORTS 3rd QUARTER 2016 EARNINGS Date 2016-10-28
Contents ● Revenue in the 3 rd quarter ended September 30, 2016 at KRW 9.703 trillion

● Operating profit in the 3rd quarter was KRW 414.9 billion


 

*Please note that the earnings results for the fiscal 3rd quarter of 2016 are subject to further verification by independent auditors.


SEOUL, Oct 28, 2016  SK innovation [KS 096770], Korea’s leading energy provider, today announced its financial results for the 3rd quarter ending September 30, 2016. Revenue in the 3rd quarter was KRW 9.703 trillion, down by 22%, or KRW 2.7443 trillion, and operating profit was KRW 414.9 billion, up by 12% or KRW 44.4 billion year-on-year.

Revenue for the 3rd quarter was down by 5.6% or KRW 577.2 billion, and operating profit was down by 62.9% or KRW 704.6 billion quarter-on-quarter due to maintenance carried out during the 3rd quarter.

The accumulative operating profit from the 1st to 3rd quarters stood at KRW 2.3792 trillion, surpassing the full-year operating profit of KRW 1.9796 trillion last year.

 



3rd QUARTER BUSINESS ANALYSIS

Petroleum

  • Petroleum business recorded revenues of KRW 7.0252 trillion and an operating profit of KRW 91.9 billion in the 3rd quarter, achieving similar results to the same period last year. However, the operating profit fell from the previous quarter due to lower refining margins and the extinction of inventory gains.

  • The refining margins are likely to improve following a in global inventory level and a seasonal pick-up in demand.

    Petrochemical

  • Petrochemical business posted revenue of KRW 1.8343 trillion and an operating profit of KRW 215.4 billion in the 3rd quarter as strong product spreads for ethylene and paraxylene boosted profit despite lower sales volume due to regular maintenance activities

  • The spread of main products in the 4th quarter could be affected by the completion of maintenance activities in cracker facilities, scheduled maintenance activity of downstream facilities, and an increase in production capacities in the region.

    Lubricants

  • Lubricants business posted revenue of KRW 598.9 billion and an operating profit of KRW 117 billion in the 3rd quarter, which is down from the previous quarter due to a in sales volume.

  • The market condition for lubricants is forcast to be stable due to growing demand for premium base oil products.

    Exploration & Production

  • SK innovation’s E&P business recorded revenues of KRW 139.7 billion with an operating profit of KRW 36.6 billion for the 3rd quarter. The operating profit is up by KRW 20 billion from the previous quarter and by KRW 38.4 billion from a year earlier.



 

3Q 2016 FINANCIAL PERFORMANCE*

 

 

 

(Unit: KRW in billions)

 
 

3Q 15

 
 

2Q 16

 
 

3Q 16

 
 

QoQ

 
 

YoY

 
 

Revenue

 
 

12,447.3

 
 

10,280.2

 
 

9,703.0

 
 

-5.6%

 
 

-22.0%

 
 

Operating Profit

 
 

370.5

 
 

1,119.5

 
 

414.9

 
 

-62.9%

 
 

12.0%

 







 

3Q 2016 BUSINESS PERFORMANCE *

 

 

(Unit: KRW in billions)

 
 

3Q 15

 
 

2Q 16

 
 

3Q 16

 
 

Petroleum

 
 

Revenue

 

OP

 
 

9,036.0

 

106.8

 
 

7,442.5

 

705.2

 
 

7,025.2

 

91.9

 
 

Petrochemical

 
 

Revenue

 

OP

 
 

2,354.3

 

119.8

 
 

1,945.0

 

302.7

 
 

1,834.3

 

215.4

 
 

Lubricants

 
 

Revenue

 

OP

 
 

665.2

 

83.0

 
 

653.3

 

132.9

 
 

598.9

 

117.0

 
 

Exploration & Production

 
 

Revenue

 

OP

 
 

159.3

 

-1.8

 
 

120.2

 

16.6

 
 

139.7

 

36.6