In spite of deteriorating external conditions and maintenance shutdowns SLOVNAFT performance remained strong

In spite of deteriorating external conditions towards the end of the year and extensive planned maintenance shutdowns rescheduled to Q4 SLOVNAFT succeeded to increase crude oil processing in Q1-4 2006 by 201kt compared to the previous year. Diesel production increased by 172kt, while gasoline production decreased by 114kt y/y. During 2006 only low-sulphur content diesel was produced, out of which almost 36 % represented FAME (Fatty Acid Methyl Ester) content diesel. Biogasoline represented 11 % of the total gasoline production in 2006.

Very sound performance during Q1-3 2006 created a robust basis for SLOVNAFT to maintain its excellent position on high competitive export markets where the yearly revenues went up by 13.4 % on y/y basis to SKK 82.98bn. Besides that SLOVNAFT kept focusing on ensuring reliable supplies to the domestic market. Supported by increasing demand mainly for diesel, the company succeeded to sell more by 8% in volume terms on the domestic market. Domestic sales revenues strengthened nearly by 18% y/y to SKK 30.21bn. From November 2006 SLOVNAFT started to supply the domestic market only by motor fuels with bio components. Total net sales revenues were higher by 17%.

The polymer sales’ volumes increased by 25 % to 387kt in Q1-4 2006 compared to the same period of the previous year mainly due to increased capacity of the PP plant launched in 2005. As a result of this the composition of polymer sales changed, the ratio of PP sales rose to 57 %.

“Though impacted by weaker external conditions in the industry and maintenance shutdowns of key production units the SLOVNAFT Group performance continued being strong also in 2006. Sound performance has been predominantly due to strong export position of the company with, sale of fuels with bio-components and continuous improvement of key internal processes and ongoing synergy utilization from joint operations within the MOL Group. Those factors are expected to remain the key pillars of the sustainable growth also in the future,” commented on the 2006 results the SLOVNAFT CEO Oszkár Világi.

In Q1-4 2006, the SLOVNAFT Group recorded a CCS adjusted operating profit of SKK 7.89bn what is 11% lower than the Q1-4 2005 result mainly due to the above mentioned factors and the development of exchange rate with the negative effect of SKK 1.8bn.

SLOVNAFT succeeded to improve also its retail sales even in spite of lower number of filling stations in operation in Slovakia by 46. At the end of December 2006 SLOVNAFT operated 210 filling stations. The trend of dieselization continued on the market also in 2006 compensating the drop in gasoline sales.

In 2006 the SLOVNAFT Group invested SKK 4.3 bn, what represents a total increase of SKK 0.3bn in comparison with 2005. The major part of investments went into the environmental projects.