China Aviation Oil warns of fourth-quarter net loss
China Aviation Oil (Singapore) has issued a profit warning, saying that it expects a net loss for the fourth quarter of 2008 due to costly jet fuel inventories procured at Shanghai Pudong Airport even as oil prices fell in the quarter, although it will remain profitable for FY2008. Giving an update on Q4 - ahead of its full-year results announcement on Feb 25 - CAO said that its 33 per cent owned associate company, Shanghai Pudong International Airport Aviation Fuel Supply Company is expected to incur a net loss of about US$33 million for Q4. This is due to a sharp decline in oil prices in the final quarter of 2008, as a result of which the unit incurred an operating loss due to higher procurement costs of jet fuel versus its sales revenue. 'The decline in the regulated domestic prices in the PRC during the month of December 2008 exacerbated the losses,' CAO added. As a result, CAO group's share of net loss from the unit is expected to be about US$11 million.
Source: Kim Eng
Tuesday, February 17, 2009
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