Neste reports strong Q3 for renewable products segment

By Erin Voegele | October 25, 2019

Neste Corp. released third quarter financial results on Oct. 25, reporting a comparable operating profit of €435 million ($481.92 million), the company’s highest quarterly result ever. The company’s renewable products segment posed a comparable operating profit of €305 million, its second highest quarterly result in company history.

In a statement, Neste President and CEO Peter Vanacker said the renewable diesel market continued to be favorable during the third quarter, but feedstock markets remained tight. “Our sales optimization worked well and sales volumes were 716,000 tons, which was more than 30 percent higher than in the corresponding period last year,” he continued. “The comparable sales margin averaged at $635 per ton, which was up 12 percent from the second quarter, and almost at the level of the corresponding period last year. During the third quarter, our renewable diesel production facilities operated at a high average utilization rate of 101 percent. The share of waste and residues was 81 percent of the total renewable raw material inputs.”

Of the 716,000 tons of renewable diesel Neste sold during the third quarter, 30 percent was destined for North America. The remaining 70 percent was sold to customers in Europe.

Moving forward, Neste said it expects demand for renewable diesel to remain strong in the fourth quarter in anticipation of growing mandates in 2020. The company also said feedstock markets are expected to continue on a strengthening trend. Utilization rates of the company’s renewables production facilities are expected to remain high, with the exception of a planned four-week catalyst change at the Rotterdam facility in the fourth quarter. Catalyst changes are also scheduled to take place at the Singapore facility during the second quarter of 2020 and at the Rotterdam facility during the fourth quarter of 2020. In addition, an 11-week major turnaround is scheduled to take place at the Porvoo facility during the second quarter of next year.

The renewable products segment posted a comparable operating profit of €305 million, up from €288 million during the same period of last year. Neste’s oil products segment reported €113 million in operating profit, down from €146 million. Overall, the company’s third quarter operating profit reached €444 million, up from €250 million during the same period of last year. Comparable earnings per share were €0.35, down from €0.40, and earnings were share were €0.35, up from €0.22.