Mol Nyrt., Hungary’s largest refiner, posted a deeper-than-expected drop in first-quarter profit as oil and gas production fell.
Net income slumped 56 percent to 32.3 billion forint ($142 million), the company said in a statement to the Budapest Stock Exchange today. That compared with a 40.2 billion-forint mean estimate in a Bloomberg survey. Average oil and gas production excluding Syria fell 10 percent to 110,000 barrels of oil equivalent per day as its fields in central and eastern Europe are getting depleted and offshore production in Croatia shrank 27 percent from a year earlier, Mol said.
Stopping the decline in production will be one of the company’s main goals for 2013 after “slow” economic growth, pressure on fuel demand and the lack of Syrian production weighed on first-quarter earnings, Chairman Zsolt Hernadi said in the statement.
“The main problem is the drop in production,” with the decline in Croatia especially concerning, the Budapest-based broker unit of KBC Groep NV said in an e-mailed report today.
Earnings before interest, taxes, depreciation and amortization adjusted for special items and inventory revaluation rose an annual 2 percent to 141.2 billion forint.
Mol shares fell 0.6 percent to 16,515 forint at 11:39 a.m. in Budapest, extending this year’s decline to 7 percent.