Grupa Lotos SA, Poland’s second-largest oil refiner, reported a third-quarter net loss on revaluation of its foreign currency-denominated debt as the zloty weakened.
Lotos posted a loss of 328.6 million zloty ($102.7 million), compared with a profit of 1.05 billion zloty a year earlier. That compares with the 379 million-zloty mean estimate of a loss by four analysts surveyed by Bloomberg. Nine-month profit increased to 560.1 million zloty from 427.9 million zloty.
Gdansk, northern Poland-based Lotos reported a loss of 525.1 million zloty on financial operations as the zloty, which weakened 16 percent against the dollar in the quarter, increased the value of the $1.75 billion loan that the company took in 2008 to finance boosting the capacity of its refinery by 75 percent. The company had a 966.4 million-zloty profit on financial operations a year earlier.
The new capacity helped the company increase sales by 44 percent to 7.6 billion zloty in the third quarter, which beat the analysts’ estimate of 7.45 billion zloty. Earnings before interest and taxes, or Ebit, declined 72 percent to 92.6 million zloty as the weaker zloty raised Lotos’s liabilities linked to oil purchases. Analysts’ mean estimate had been for Ebit of 210.6 million zloty.
The company is expecting that the operating profit and the net result will improve in the last three months of the year, compared with the third quarter, Polish Press Agency reported, citing Chief Executive Officer Pawel Olechnowicz.