Husky Energy Quarterly Profit Falls on Lower Refining Returns

Husky Energy Inc. (HSE), the Canadian producer controlled by Hong Kong billionaire Li Ka-Shing, said third-quarter profit fell on lower refining margins.

Net income dropped to C$512 million ($492 million) or 52 cents a share, from C$526 million, or 53 cents, a year earlier, the Calgary-based company said in a statement on Marketwired today. Excluding one-time items, per-share profit of 55 cents compared with the 54-cent average of 11 analysts’ estimates compiled by Bloomberg.

Husky was forecast to be the most affected by lower U.S. refining margins among its Canadian peers, Chris Feltin and Brian Bagnell of Macquarie Capital Markets Canada Ltd., said in an Oct. 10 research note. “Significantly lower market crack spreads had an impact on refining margins in the third quarter,” the company said in today’s statement.

Husky, an integrated energy company with refining operations in Ohio and an upgrader in Western Canada, is developing the Liwan offshore gas project in the South China Sea and the Sunrise oil-sands project as part of a plan to boost equivalent oil output 5 to 8 percent in each of the next four years.

Oil prices in the U.S. rose 15 percent from a year earlier to average $105.81 a barrel in the quarter.

Husky released results before the start of regular trading on North American markets. The stock, which is little changed this year, fell 0.6 percent to close at C$29.19 in Toronto yesterday. The shares have five buy and 12 hold recommendations from analysts.

To contact the reporter on this story: Rebecca Penty in Calgary at rpenty@bloomberg.net

To contact the editor responsible for this story: Susan Warren at susanwarren@bloomberg.net

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