Polish state-controlled energy group Orlen reported a near 20 per cent rise in its third-quarter core profit on Thursday, helped by a strong recovery in its downstream segment even as revenue fell due to lower oil prices.
The company’s core profit adjusted for changes in value of its oil inventories, or EBITDA LIFO, was PLN7.17 billion ($1.95 billion) in the quarter, up from PLN5.99 billion in the same period in 2024.
The result was supported by a 97 per cent year-on-year jump in the company’s model refining margin to $15.2 per barrel, which helped offset a 14 per cent drop in Brent crude prices.
The state-controlled group is in the middle of a strategic pivot after diversifying crude supplies away from Russia while revamping its petrochemical business. In October, it offered to buy out ailing Grupa Azoty’s polyolefins unit in a deal valued at $278 million.
Orlen’s downstream segment’s EBITDA LIFO result swung to a profit of PLN757 million, from a loss of PLN2.75 billion a year earlier, mainly due to smaller impairment charges on its assets, the quarterly earnings report showed.
The improvement was partially offset by a sharp decline in the upstream segment, where core profit fell by nearly PLN3 billion year-on-year due to lower margins from gas sales.
Adjusted for write-downs, Orlen’s core profit reached PLN8.9 billion in the quarter, in line with analysts’ estimate in a company-compiled consensus.
Capital expenditures in the first nine months of the year reached PLN21.1 billion, as the company funded investments including offshore wind farms and modernisation of its energy and gas networks.
Looking toward the fourth quarter, Orlen forecast an improvement in its upstream and energy segments and a stable result in downstream, but expected a decline in its consumer-facing business due to seasonally lower volumes.
(Reporting by Rafal Nowak and Marek Strzelecki, editing by Milla Nissi-Prussak)