Neste Corporation, a global leader in renewable and circular solutions, released its Interim Report for January–March 2024 today, demonstrating resilience in a weak renewables market.
Key Highlights of the First Quarter:
- Comparable EBITDA amounted to EUR 551 million, down from EUR 830 million in the same period last year.
- Renewable Products’ comparable sales margin stood at USD 562/tonne, reflecting the impact of a weaker market.
- Oil Products’ total refining margin was USD 20.4/bbl, slightly lower compared to the previous year.
- Cash flow before financing activities was EUR -340 million, impacted by higher inventories and preparations for major turnarounds.
- The comparable return on average capital employed (ROACE) was 20.1 percent over the last 12 months.
- Leverage ratio was 27.9 percent at the end of March.
Matti Lehmus, president and CEO of Neste Corporation, commented on the company’s performance, stating, “Our focus was on defending margins in a more challenging market as the market situation in renewable diesel was clearly weaker in the first quarter of 2024 compared to the previous year.”
Renewable Products Segment:
- Comparable EBITDA for renewable products totaled EUR 242 million, impacted by a weaker market in renewable diesel.
- Sales volume reached 849 thousand tonnes, affected by seasonally lower demand and inventory build-up.
- Production at the Singapore second line remained stable, with the share of waste and residue inputs reaching 91%.
Oil Products Segment:
- Comparable EBITDA for oil products amounted to EUR 278 million, following somewhat lower refining margins and reduced sales volume.
- The Porvoo refinery’s operational performance remained solid, with a utilisation rate of 91 percent.
Marketing & Services Segment:
- Comparable EBITDA for Marketing & Services was EUR 23 million, reflecting the company’s resilient market position despite logistical challenges.
Strategic Initiatives and Outlook:
- Neste completed its organisational change process during the quarter, focusing on strengthening long-term competitiveness and improving cost efficiency.
- The company remains committed to its growth strategy in renewable and circular solutions, with a focus on operational execution and increasing sustainable aviation fuel sales.
- The market outlook for 2024 remains uncertain, with expected volatility in renewable diesel prices and refining markets.
Guidance for 2024:
- Renewable Products’ total sales volume is expected to increase, reaching approximately 4.4 Mt in 2024, with a full-year average comparable sales margin in the range of USD 600–800/tonne.
- Oil Products’ total sales volume is expected to be lower than in 2023, impacted by planned turnarounds.
- Total fixed costs in 2024 are expected to be somewhat higher due to major turnarounds and growth in project resources.
Neste Corporation maintains its full-year guidance for 2024, focusing on operational excellence and sustainable growth amidst market challenges.
For more information visit www.neste.com
