​• In 3Q2016 operating profit EBITDA LIFO reached CZK 1.928bn, net profit at the level of CZK 722 m
• Agreed next payment for steam cracker accident insurance claim of CZK 2.2 bn presented in 3Q2016 financial statements
• Operating profit of the retail segment increased to CZK 336m
• Benzina network of petrol stations increased its retail share to 17.2%
• During October, the Company resumed full operation in its refinery  in Kralupy nad Vltavou and resumed production at the steam cracker

Prague, October 20, 2016 – Unipetrol’s third quarter financial results were significantly affected by the limited availability of production capacity. In the third quarter of 2016, Unipetrol posted operating profit EBITDA LIFO worth CZK 1.928bn and net profit of CZK 722m. Company’s revenues dropped by 22 % y/y to CZK 23.110bn due to persisting low crude oil prices and y/y lower sales of petrochemical and refinery products. The extraordinary event at the steam cracker that occurred on 13 August 2015 as well as the unplanned shutdown of the Kralupy refinery which occurred in mid-May reflected in Unipetrol’s operating results. The agreed next payment for steam cracker accident insurance claim of CZK 2.2 bn  as well as better results in retail segment had positive impact on the profit.

„In the third quarter we managed to complete the repair of steam cracker which was put back into operation earlier this week. The company also successfully completed repair of FCC unit in Kralupy refinery, so both Kralupy and Litvinov refineries are being currently operated in full capacity,” says CEO and Chairman of the Board of Directors of Unipetrol, Andrzej Modrzejewski. „In the third quarter we recorded strong operating profit in the retail segment due to increased fuel sales and refreshments sales in the STOP CAFE restaurant network. By the end of September we took over 13 petrol stations from OMV and plan to rebrand another 15 stations till the end of this year,” adds Andrzej Modrzejewski.

Within the downstream segment consisting of refining and petrochemical part the Company showed the operating profit EBITDA LIFO of CZK 1.596bn in 3Q2016. This result was positively influenced by the agreed next payment for steam cracker accident insurance claim of CZK 2.2bn as well as by positive effect of inventory revaluation. On the contrary, the downstream segment results were affected negatively by y/y lower refining margins and drop of refinery and petrochemical production.

Regarding the refining part of downstream segment, the Company saw a decline in volumes of refinery product sales by 4% to 1.613 million tons, especially with regard to the lower utilization of refining capacities due to the Kralupy refinery shutdown and limited production at the refinery in Litvinov. The volume of processed crude oil reached the level of 1,039 thousand tons representing a utilization of refining capacity at 48%. In the third quarter, repair works took place at the Kralupy refinery which has already started up normal operation.

Results in the petrochemical part of downstream segment continued to be significantly affected by the extraordinary situation at the steam cracker unit. Sales volumes of petrochemical products therefore dropped to 247 thousand tons y/y (-26 %). Petrochemical model margin decreased by 11% y/y, however maintained at very good level of 841 EUR/t.  In the third quarter, the Company completed repair works at the steam cracker and successfully implemented all necessary steps to restore production. Eight out of ten steam cracker heaters are in the operation at the moment and the normal production level is expected to be reached at the end of October this year. 

In the third quarter of 2016, the retail segment reached very good operating profit EBITDA LIFO of CZK 336m. The y/y increase in operating profit (+ CZK 52m) was achieved mainly because of higher fuel sales due to the good dynamics of domestic economy as well as rising demand. Benzina showed improved results also in the non-fuel part of the segment, especially regarding the expansion of STOP CAFE concept. The petrol station network increased its market share to 17.2% (a figure from the end July 2016). The Company continues in the project of taking over petrol stations from OMV. Benzina took over 13 stations until end-September planning to take over in total 28 of them by the end of the year. The entire petrol stations acquisition and rebranding project is expected to be completed next year.

Regarding the extraordinary event at the steam cracker unit from August 13, 2015, Unipetrol is insured against both property & mechanical damages and business interruption. Company expects, based on internal estimates made at the end of September 2016, it should be in a position to recover from insurer costs of repair at the level of CZK 3.9 bn and lost business profit at the level of CZK 9.9 bn. The final amount of compensation will depend on the final agreement with insurers. Unipetrol has received CZK 3.9 bn (recognized in 2Q2016), the next agreed payment of CZK 2.2 bn presented in 3Q2016 financial statements.