Financial results in Q4 (FY) 2013 compared to Q4 (FY) 2012:
• Higher inland sales volumes by 7 per cent 4Q13/4Q12 (11 per cent FY2013/FY2012);
• Higher inland sales volumes to CIS and other markets by 24 per cent 4Q13/4Q 12(11 per cent FY2013/Y2012);
• Higher inland sales volumes to Baltic markets by 3 per cent 4Q13/4Q12 (9 per cent FY2013/FY2012);
• Greater Inland/Seaborne ratio, higher by 2 p.p. 4Q13/4Q12 (4 p.p. FY2013/FY2012);
• Lower revenues from product sales by 18 per cent 4Q13/4Q12 (1 per cent FY2013/FY2012);
• Higher Operational availability by 8 p.p. FY2013/FY2012;
• Record low internal usage of fuel and losses – lower by 0.2 p.p. FY2013/FY2012.
Unfavorable macroeconomic conditions and the impact of heavy pressure on margins in the whole European oil refining industry affected ORLEN Lietuva’s performance and caused decrease of the Company’s revenues by 18 per cent in 4Q 2013, compared to the same period of 2012. EBITDA LIFO in 4Q 2013 amounted to USD -48 MM.
Severe competition on global fuel markets, new paradigmatic changes due to shale oil exploration in the United States and unfavorable logistic situation had very strong negative impact on ORLEN Lietuva’s financial results. Such situation caused lower revenues and pushed the Company into reduction of the throughput volumes in 2013.
“For ORLEN Lietuva, the largest company in Lithuania and export leader, stable and successful operations can be ensured only by reducing costs, especially logistic. The new product pipeline from Mažeikiai to the seaside is crucial to preserve competitiveness of Lithuanian petroleum products on the global markets and create grounds for long-term business operations of the Company,” said Ireneusz Fąfara, general director of ORLEN Lietuva.
Striving to minimize the market-driven unfavorable conditions, the Company decreased the capacity utilization by 15 p.p. 4Q13/4Q12. At the same time the year-to-year indicator was improved by 5.72 p.p.
The continuous focus on the Baltic market share development in Q4 2013 resulted in increased sales on inland markets by 11 per cent (4Q13/4Q12) and better inland/ seaborne ratio by 2 p.p. 4Q13/4Q12 (or by 4 p.p. FY2013/FY2012).
Despite the development of the inland markets, the Company experienced the total sales volume decrease by 17 per cent Y/Y due to lower seaborne sales by 35 per cent 4Q13/4Q12 (2 per cent FY2013/FY2012).
In 2014, Orlen Lietuva will remain committed to achievement of its operational goals with the aim to improve its business efficiency. The Company’s efforts include gaining better yields of light products through usage of the Vacuum Flasher technology in order to achieve higher margins. The company will also focus on raising its inland sales ratio and facilitating optimization of logistical costs by conducting works on the project of the product pipeline from the refinery to seacoast.