Seoul: SK Innovation Co., South Korea's leading refiner by sales, announced on Thursday that its net loss expanded in the fourth quarter compared to the previous year, primarily due to increased costs.
According to Yonhap News Agency, the company's net loss in the three months ending in December grew to 1.07 trillion won (approximately US$745.5 million), a significant increase from the 2.3 billion won loss recorded in the same period last year. This information was disclosed in a regulatory filing by the company.
The company attributed the quarterly financial decline to "high interest on loans (the company took from financial institutions) and increased spending on raw materials," as stated by a company spokesperson during a phone interview. Despite the widening net loss, the company's operating profit more than doubled to 159.9 billion won in the fourth quarter, compared to 72.6 billion won in the same timeframe the previous year. This improvement in operating results was supported by better refining margins and the merger with SK E and S Co., according to the spokesperson.
In November, SK Innovation merged with its renewable energy affiliate SK E and S, forming the largest private energy company in the Asia-Pacific region. The newly integrated company, retaining the name SK Innovation Co., possesses combined assets of 105 trillion won and reports 88 trillion won in sales.
Despite these developments, the company's quarterly sales experienced a slight decline of 0.6 percent, reaching 19.4 trillion won from 19.5 trillion won a year ago. For the entire year of 2024, the company reported a shift to a net loss of 2.4 trillion won, in contrast to a net profit of 554.89 billion won recorded the previous year. Additionally, the operating profit saw a dramatic fall of 83 percent, down to 315.4 billion won from 1.9 trillion won, and sales decreased by 3.3 percent to 74.7 trillion won from 77.2 trillion won.