Israel Corporation (TASE: ILCO) subsidiary Oil Refineries Ltd. (TASE:ORL) today published its financial report for the fourth quarter and full year of 2008. The company posted a net loss of $109.2 million ($0.55 per share) in 2008 compared with a net profit of $141.7 million in 2007.
The company attributed the loss to volatile crude oil prices during 2008, which resulted in losses on unsecured inventory, lower refining margins, and a reduction in working capital.
Oil Refineries' revenue rose 57.7% to $8.26 billion in 2008 from $5.23 billion in 2007. Despite a general decline in fuel consumption in the domestic market, the company continued to increase sales and its market share. Production of refined oil products rose 6% in 2008 to 8.2 million tons.
The company posted a net loss of $182 million for the fourth quarter, compared with a net profit of $18 million in 2007. The net loss was less than the $200 million profit warning published a month ago.
Oil Refineries CEO Yashar Ben-Mordechai said, "The fall in the price of oil last year affected the value of basic inventory level, which in accordance with company policy and a long-term outlook hedge, in line with most refinery and oil companies of the world. From an operating and business perspective, Oil Refineries continued to increase its domestic and international sales, despite the overall decline in consumption. The company's restructuring led to a focus on various businesses and to an increase in facility exploitation to 92%, and all-time high."
Israel Corp. owns 45.08% of Oil Refineries and Israel Petrochemical Enterprises Ltd. (TASE:PTCH) subsidiary Petroleum Capital Holdings Ltd. (PCH) owns 15.76%. Oil Refineries' share fell 4% by early afternoon to NIS 1.23. Israel Corp.'s share fell 5.8% to NIS 13,580.
Published by Globes [online], Israel business news - www.globes-online.com - on March 30, 2009
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