S-Oil reports steep drop in Q2 earnings

S-Oil Corp., South Korea’s third-largest refiner, said its net income fell 80.5% in the second quarter from a year earlier due to lower refining margins and routine plant maintenance. Net profit came to 71 billion won (US$60.12 million) in the April-June period, compared with 368.6 billion won (US$312.15 million) a year ago. Sales dropped 37.6% year-on-year to 4.07 trillion won (US$3.4 billion) during the same period and operating profit nearly halved to 42.2 billion won (US$35.73 million). The company predicts that the oil refining sector will make a comeback from the fourth-quarter, on the back of an expected increase in demand in Asian countries. It also projected a bright outlook for its petrochemical and lubricant sectors in the second half of the year, on expectations that demand for benzene and lubricating oil will increase. (July 31, 2009)