S-Oil swings to loss in Q4 on weaker won, lower margin

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SEOUL, Jan. 23 (Yonhap) -- S-Oil Corp., South Korea's third-largest refiner, said
Friday that it swung to a loss in the fourth quarter of last year due to a weaker
won and falling refining margins.
The company posted a net loss of 185 billion won (US$133 million) in the
October-December period, compared with a profit of 126 billion won a year
earlier, it said in a regulatory filing.
The fourth-quarter loss is its first loss in six years. S-Oil said it posted a
foreign-exchange loss of 171.4 billion won in the last quarter as a weaker won
raised its financial burden on foreign debts and importing crude oils.
Sales gained 1.8 percent on-year to 4.59 trillion won, but the company suffered
an operating loss of 123 billion won, compared with an operating income of 229
billion won a year earlier.
For the whole of 2008, the company's net profit tumbled 39 percent on-year to 629
billion won. Sales jumped 51 percent to 23 trillion won, but operating income
fell 29 percent to 1.4 trillion won, it said.
Earnings were also eroded by a decline in the value of its stockpiles of crude
and products, according to S-Oil.
The company forecast that sales will decline this year due to a fall in oil
prices, saying demand will recover in the second half of the year. The local
currency fell 26 percent against the U.S. dollar last year.
sam@yna.co.kr
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