SEOUL, Oct. 23 (Yonhap) -- S-Oil Corp., South Korea's third-largest oil refiner, said Wednesday its third-quarter net profit plunged 77.6 percent from a year earlier on inventory losses and a weak Korean won.
Net profit for the three months ending Sept. 30 came to 51.6 billion won (US$43 million), compared with a net profit of 229.8 billion won a year earlier, the company said in a statement.
Operating profit dropped 26.9 percent on-year to 230.7 billion won, while its sales fell 13.3 percent on-year to 6.2 trillion won during the cited period.
However, compared with the previous quarter, S-Oil swung to the black, thanks to improved refining margins.
S-Oil said its poor third-quarter earnings stemmed from fluctuating oil prices that caused inventory losses coupled with the Korean won's weakness against the U.S. dollar.
International oil prices in the third quarter dropped roughly $10 per barrel compared to a year ago. The Korean won surpassed the 1,200-won threshold against the U.S. dollar during the third quarter, which didn't happen a year earlier, burdening the refiner when purchasing crude from overseas.
S-Oil said it posted a 109.4 billion-won loss in foreign exchanges in the July-September period, compared with 24.7 billion won profit a year earlier. It also suffered a 45.6 billion-won loss in interest payments in the cited period.
S-Oil's refining business posted a 99.7 billion-won operating profit in the third quarter, compared with a 170.4 billion-won operating profit a year ago. Its petrochemical sector achieved an operating profit of 79.4 billion won, down 22.2 percent from a year earlier.
Its lubricant business logged an operating income of 51.6 billion won, an on-year increase of 19.4 percent.
For the first nine months of the year, S-Oil said it posted a net profit of 17.7 billion won, compared with a profit of 581.8 billion won a year ago. Operating income tumbled 57.8 percent on-year to 410.5 billion won, while sales declined 3.7 percent to 17.9 trillion won.