MOL Closes Profitable 3Q On Currency Moves
November 14 2011 - 6:09PM
Dow Jones News
Hungarian oil and gas company MOL Nyrt. (MOL.BU) reported early
Tuesday a third-quarter net profit of 36.4 billion forints ($156.9
million), driven by the performance of the upstream business and
gains from currency exchange rates.
The figure beats an analyst consensus which expected MOL to
produce a quarter in the red on losses from forint weakness.
Instead, MOL said it remained profitable due to the fact that
third-quarter foreign exchange losses have been recognized on the
equity line due to the implementation of net investment hedge
accounting.
MAIN POINTS
--The poorer figures were predicted by analysts seeing the
continued depreciation of the forint, which hit record low levels
around HUF317 against the euro hours before MOL's report was
published.
--The move marks a change in the company's strategy, which
referred to exchange rate losses as a "natural risk" after the
second quarter.
--MOL registered diluted earnings per share of HUF175 vs
HUF1,076 in the corresponding quarter of 2010.
--It reported a net financial loss of HUF18.3 billion and an
unadjusted earnings before interest and taxes figure of HUF50.8
billion.
--"We are aiming to accelerate our investment programs in
Russia, the Kurdistan Region of Iraq and in the core CEE countries.
Beside this we are continuously evaluating potential inorganic
steps as well," MOL Chief Executive and Chairman Zsolt Hernadi is
quoted as saying in the report.
--MOL said there is a risk of recession in the global economic
environment at the moment as the latest indicators point towards a
marked slowdown in activity.
--MOL closed down 0.9%, or HUF150, at HUF16,850 in Monday's
trading.
-By Gergo Racz, Dow Jones Newswires, +36 30 452 3980;
gergo.racz@dowjones.com
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