S-Oil Corp. said Friday it swung to the red in the second quarter as the routine maintenance of its refinery plants weighed on sales amid falling oil prices.
Net loss came to 22.4 billion won (US$17.6 million), swinging from a profit of 1.01 trillion won a year earlier, the company said in a regulatory filing.
It posted 36.4 billion won in operating profit for the quarter, compared with 1.72 trillion won in operating income a year earlier. Revenue fell 31.7 percent to 7.81 trillion won over the cited period.
The loss was 102 percent higher than the average estimate, according to a survey by Yonhap Infomax, the financial data firm of Yonhap News Agency.
"The large-scale routine maintenance and inventory losses from falling oil prices amid the thinner cracking margin led to the operating loss in the refinery business," the company said.
Its refinery segment posted an operating loss of 292.1 billion won, with sales of 6 trillion won.
The petrochemical division booked 82 billion won in operating profit on sales of 1 trillion won, while the lubricants sector registered 246.5 billion won in operating income with sales at 810.5 billion won.
S-Oil said it expects to fare better in the third quarter as the maintenance work will be completed by the end of July and operation rates will be back to normal.
The refinery margin, a key gauge of profitability, is also expected to rebound in the next quarter, it said.
Saudi Arabia's state oil giant Aramco is currently the largest shareholder of S-Oil, with a 63.4 percent stake.
Shares in S-Oil fell 0.95 percent to 72,900 won on the Seoul main bourse Friday, underperforming the broader KOSPI's 0.17 percent gain. The earnings results were released after the market closed.
Source: Yonhap News Agency