HELSINKI: The Finnish oil refiner Neste Oil has lifted its full-year profit guidance by about 37.5 percent on the back of a reinstatement of the renewable fuel tax credit in the United States, favourable business performance and a one-off gain.
Neste said in a statement on Saturday it expects its 2014 comparable operating profit to be above 550 million euros ($672 million), after a previous forecast of above 400 million euros. The US blender's tax credit, which was approved for the year 2014 on Friday, is expected to improve the firm's profit by about 80 million euros this year, it said.
Biofuel blenders are eligible for a tax credit of $1 per gallon, and the break is shared between the buyer and seller. Neste, 50-percent owned by the state of Finland, also said it has won an insurance payout to cover some of the losses from damage at its Porvoo refinery a few months ago.
The incident cost Neste 60 million euros in profit, prompting it to issue a profit warning in August. The agreed compensation will make up about 40 million euros of that deficit.
Neste added that its business performance had exceeded expectations in the fourth quarter. It had said in its quarterly report in October that the short-term market situation had clearly improved.
Neste has two conventional refineries in Finland as well as renewable diesel refineries in Singapore and Rotterdam. It makes renewable diesel from sources such as palm oil and animal fats.
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