Reuters - Hungarian oil group MOL's net profit halved in the fourth quarter due to a squeeze on gasoline margins as well as big impairment charges related to its Croatian assets and the shutdown of a refinery in Italy.
MOL's upstream business however performed relatively well, with quarterly EBITDA earnings excluding special items of 89.7 billion forints ($398 million), up 6 billion forints from the third quarter and only 11 percent down on an annual basis.
MOL posted a fourth-quarter net profit of 4.9 billion forints on a group level, down from 9.5 billion forints in the same period of 2012. The company posted a net loss of 30 billion forints in the third quarter.
Its clean quarterly EBITDA earnings dropped 12 percent from a year earlier to 122.2 billion forints, compared with 138.4 billion forints in the third quarter.
"In Q4 2013 we experienced one of the toughest refinery margin environments of the last years," MOL said in its earnings report.
The company said its downstream result was hit by a sharp drop in gasoline crack spreads, decreasing sales volumes and one-off costs totalling 51 billion forints.
The one-off costs related to the transformation of its Mantova refinery into a logistics hub and impairment charges in Croatia. MOL holds an almost 50 percent stake in Croatian peer INA.
Downstream EBITDA, excluding special items, dropped to 9.9 billion forints from 31.8 billion in the same period of 2012.
MOL Chairman and CEO Zsolt Hernadi said in an earnings statement that the company would continue its downstream efficiency program in 2014.
Its upstream business would seek growth opportunities after buying assets in the North Sea region last year, he said.
"Going forward down this road, we are looking for attractive M&A opportunities to achieve a step change in upstream," Hernadi said.
He added that the Akri-Bijeel block in Iraq could deliver its first barrels of oil in the second quarter of 2014. ($1 = 225.7969 Hungarian forints)
(Reporting by Krisztina Than; Editing by Stephen Coates)