South Korea's third-largest refiner, S-Oil, sold a combined 639,000 b/d of oil products, petrochemicals and lube in the first quarter of this year, up 1.4% from 630,000 b/d a year ago, the company said in a statement Thursday.
Sales in Q1 were 2.7% lower than 657,000 b/d in Q4 last year.
The company did not give a breakdown of sales by products, but oil products usually account for 86-87% of its total product sales volume.
S-Oil said exports accounted for 59.0% of its total sales in Q1, down from 59.6% a year earlier, but up from 57.7% in Q4 2013. Japan was the top export destination, receiving 21% of shipments, followed by China at 20.8% and Southeast Asia at 8.7%.
The operating rate of the three crude distillation units at S-Oil's sole 669,000 b/d Onsan refinery averaged 95.7% of capacity in Q1, up from 94.2% from a year earlier and also up from 93.9% in Q4.
S-Oil plans to shut the 52,000 b/d No. 1 and 57,000 b/d No. 2 residue hydro-desulfurizing units at the refinery for maintenance in May. No turnarounds have been planned for any of the three CDUs this year. The company last shut the 250,000 b/d No. 3 CDU and 90,000 b/d No. 1 CDU in 2013 for a turnaround.
S-Oil said its net profit plunged 53.4% year on year to Won 147.2 billion ($141.8 million) in Q1, while operating profit fell 13.8% to Won 326.9 billion. Sales revenue in Q1 was Won 8.01 trillion, down 11.3% from Won 9.04 trillion a year earlier.
The company's mainstay oil segment posted an operating loss of Won 52.2 billion in Q1, compared with an operating profit of Won 131.0 billion a year earlier. Q1 revenue for the segment slipped 5.4% year on year to Won 6.18 trillion.
"The poor performance was led by weak demand of kerosene due to mild winter temperature which was partly offset by more sales of jet oil," a company official said Thursday, declining to provide further details.
S-Oil's petrochemical segment posted an operating profit of Won 46.8 billion in Q1, down 74.2% from Won 181.7 billion a year earlier, while revenue fell 14.7% to Won 895.0 billion.
Looking ahead, S-Oil expects its earnings to improve in Q2, saying: "Positive oil supply in Asia and the Middle East would decrease significantly upon capacity closures and heavy maintenance shutdowns of Asian refiners.
"The regional oil demand is likely to remain stable as a decrease in demand for heating would be offset by demand growth in the Middle East."
Meanwhile, S-Oil said it has suspended negotiations to buy a stake in Australian independent fuel retailer United Petroleum. "The two sides have failed to reach an agreement," the official said, without elaborating.
In February, S-Oil was selected as the preferred bidder for a stake in United Petroleum.
