Refinery profit 'in line with expectations'

By Phil Boeyen, ShareChat Business News Editor

Thursday 28th February 2002

New Zealand Refining (NZSE: NZR) has approved a final dividend of $1.25 a share after reporting a profit of $36.5 million for the year ended December.

The result, which the company says was in line with expectations, was around half last year's record profit performance of $69.4 million.

Chairman Ian Farrant says the refinery has continued to perform at world class levels and has demonstrated its ability to compete with other refineries in the region.

"We have produced an excellent result, a low margin environment globally. Improvements in reliability and run time between shutdowns have contributed significantly."

Mr Farrant says processing income of $144.55 million was significantly ahead of plan due to abnormally high margins experienced at times during the year and the continued weakness of the NZ dollar. The income figure compares with $175 million the previous year.

Pipeline income was consistent at $24.2 million compared with $23.6 million the year before.

The company says operating costs, excluding depreciation on plant, property, equipment and catalysts, totalled $86.34 million compared to $82.3 million previously..

"In addition the company has incurred costs totalling $6.48 million in relation to the diesel fuel filterability issue that occurred in the autumn and early winter of 2001," Mr Farrant says.

"Although costs were higher than expected, they include the cost of two major planned shutdowns."

The final dividend brings the total payout for the year to $1.75 compared with $2.50 the year before.

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