Ventspils nafta posts LVL 3.05 million of profit in first quarter
Company's public relations head Gundega Varpa: consolidated net profit of the joint stock company Ventspils nafta Group (VN) reached LVL 3.05 million lats in the first quarter of 2009, with the group’s consolidated net turnover of LVL 20.5 million in the first three months, writes LETA.
n the light of the processes in the global economy that are closely related to the work of VN companies in circumstances of international competition, these results attest that VN is able to flexibly and effectively react to the topical changes in the market situation. The previously published consolidated net profit forecast of VN for the entire year 2009 was at least LVL 2 million.
''The events in the global and Latvian economy have substantially affected activity of VN companies in the transit business sector, as they were directly affected by consequences of global processes and politically economic decisions made in Latvia in the level of local business activity. This year has been very complicated, yet the VNcompanies have been able to adjust to the operative interests of their customers and to ensure stable operating results,” emphasizes the Chairperson of the Management Board for VN Olga Petersone.
Although financial market fluctuations in the global market have decreased in the first quarter of 2009, and the increase of US dollar exchange rate has had a positive impact on the financial result of the first quarter, the management board of VN has used a conservative approach and formed provisions of LVL 4 million for possible financial market fluctuations during the remainder of the year, reflecting exchange market risks that has had a negative effect on financial results of VN in the previous periods.
VN's subsidiary crude oil and petroleum products transshipment company Ventspils nafta terminals Ltd. (VNT) has ensured a stable level crude oil and petroleum products transshipment volumes in the first quarter of 2009, which is the same to the transshipment volume reached by the terminal in the first three months of 2008. In the period from January until March 2009, 3.8 million tons of crude oil and petroleum products were transshipped by VNT.
In 2009, VNT is working in circumstances of intense competition and global financial and economic crisis, at the same time continuing implementation of the company’s modernization projects in order to strengthen positions of VNT as the largest crude oil and petroleum products transshipment complex in the Baltic region.
Among the most significant projects of VNT for improvement of infrastructure to ensure maximally effective operation of the company in the coming years is also the construction of a pipeline corridor from the company’s territory to the jetties at Ventspils Port, where loading into tankers is carried out – the planned investments into this project could be about LVL 3.7 million.
In the first three months of 2009, stable work has been done also by VN's subsidiary LatRosTrans Ltd – owner and operator of main crude oil and petroleum products pipelines in the territory of Latvia. This company has transported more than 1.5 million tons of diesel fuel and has thereby exceeded its own forecasts for the first quarter of this year.
Furthermore, the joint stock company Latvian Shipping Company (LSC) – the associated company of VN – has managed to gain net profit of USD 7.6 million in the first quarter of 2009 as a result of effective optimization of expenditure, despite the fact that activity of the company has been considerably affected by such external factors such as the low market activity and the dramatic decline of freight rates in the shipping market.
The rapid global recession along with intensive delivery of new vessel tonnage in the market caused considerable reduction of the demand for tanker tonnage. Negative tendencies could be observed in the tanker shipping markets already in June last year and have prevailed also in 2009. As a result of unfavorable external circumstances, income of LSC in the first quarter of 2009 from activity of tanker fleet was lower in comparison with the same period in the previous year.
In the intense economic circumstances, VN will also further work with a view to ensure accomplishment of goals set by shareholders and implementation of the strategic development programs of the group's companies.
VN is the central holding company in a transit-oriented group whose task is to manage the investments in subsidiaries by promoting the group’s joint values and growth in the value of each subsidiary individually.
VN is working in the following areas: transshipment of crude oil and petroleum products; transport of crude oil and petroleum products by pipelines; shipping.