ExxonMobil NZ division lifts net operating profit 57 per cent

Net profit from continuing operations for the year to December 2017 was $143.3 million, up from $91.2m in the prior year. Photo / 123RF

The New Zealand division of ExxonMobil lifted its net operating profit 57 per cent in 2017 as revenues rose on higher volumes.

The local company's net profit from continuing operations for the year to December 2017 was $143.3 million, up from $91.2m in the prior year, financial statements lodged with the Companies Office show.

Revenue rose to $2.68 billion versus $2.20b in the prior year "in what continues to be a challenge and competitive marketplace," ExxonMobil's NZ directors said in their report.

ExxonMobil NZ's spending on raw materials and consumables lifted 19.5 per cent to $1.59b, while it paid $641m in sales tax and duties, a 5.6 per cent lift on the year earlier.

Inventories lifted to $349m versus $320m in the prior year. Global oil prices are gradually recovering and are now at their highest level since November 2014 with brent crude around $80 a barrel and West Texas Intermediate (WTI) around $71 per barrel.

In 2017, the group invested $29m in infrastructure, with several assets under construction. Over 2018 "we anticipate a further $58m of investments in logistics infrastructure and operations aimed at sustaining operations integrity, lowering costs and increasing efficiencies," the directors said.

The ExxonMobil group owns 17.2 per cent of New Zealand Refining, the operator of the country's only oil refinery. In 2017, it spent $84.7m on refinery processing fees, up from $63.9m a year earlier.

It supplies a retail service station network of some 170 Mobil branded sites, of which about 121 are Mobil owned or leased. In addition, it supplies fuel to over 150 unbranded sites, according to its website.

The company's New Zealand assets were worth $998.3m in 2017 versus $1.3b in 2016, largely due to lower cash and cash equivalents.

According to the directors, for the past several years the group had maintained a significant cash balance to fund its working capital requirements. During January 2017, the group finalised a review of its cash management facilities and repaid $442m of its existing long-term borrowings representing a halving of its long term intercompany debt levels.

The value of its available-for-sale financial assets, which are its shares in NZ Refining, rose to $142.5m from $139.8m a year earlier.