South Korea’s petroleum and refinery company S-Oil Corp. reported a record-high operating profit last year after it has successfully expanded value-added petrochemical products and improved the productivity amid a boom in the petrochemical industry.

The Korean petroleum and refinery company said in its regulatory filing on Thursday that it posted an all-time high operating profit of 1.69 trillion won ($ 1.47 billion) last year, more than doubled from the previous year. Operating profit margin also topped 10 percent on the back of a growing share of high value-added products and improvement of facilities in the Ulsan plant, the company added. Over the same period, net profit also nearly doubled to 1.26 trillion won, while sales were down 8 percent to 16.32 trillion won.

The company’s stellar performance was largely owed to the rapid growth in its petrochemical and lubricant base oil businesses. Profits from its petrochemical and lubricant units accounted for 23 percent in sales last year made up more than half of the company’s operating profits, it said. In particular, its lubricant unit saw its operating income margin shoot up to 32 percent last year.

During an investor relations (IR) conference call, S-Oil also forecast its business would continue to fare well in 2017. Its refining business is expected to further expand its presence in China and South East Asia on solid demand. The company also projected refining margin would remain high as facilities with a capacity of 800,000 barrels in Japan are scheduled to be shut down this year.

As planned, S-Oil will to triple its investment this year to 3.19 trillion won to upgrade facilities and its petrochemical complex project. The company will invest 5 trillion won in total until 2018 for the project in which it constructs a petroleum residue decomposition facility. The construction has been completed 34.7 percent as of the end of last year, the company said.

At 2:42 p.m. on Friday, shares of S-Oil Corp. were trading down 1 percent, or 800 won, at 81,200 won from the previous session.

By Jung Wook

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