Nippon Oil expects record net loss

Japan’s Nippon Oil Corp. said it anticipates a record group net loss of ¥240 billion (US$2.61 billion) for fiscal 2008 as a result of the sharp fall in crude oil prices, which reduced the value of oil inventories. Valuation losses on its oil inventories are expected to balloon to ¥410 billion (US$4.46 billion) from the earlier projected loss of ¥73 billion (US$795.15 million). Nippon Oil said it expects to book an extraordinary loss of ¥63 billion (US$686.22 million) from its oil development operation in the Gulf of Mexico due to low oil prices. The company expects a pretax loss of ¥270 billion (US$2.94 billion), compared to a profit of ¥275.67 billion (US$3 billion) in fiscal 2007. Sales are estimated at ¥7.6 trillion (US$82.78 billion), down from the earlier projected ¥8.85 trillion (US$96.40 billion) but up from ¥7.52 trillion (US$81.91 billion) in fiscal 2007. Excluding the inventory valuation losses, the company would post a pretax profit of ¥140 billion (US$1.52 billion), Nippon Oil said. (January 30, 2009)