Petrolimex incurs huge losses
Petrolimex incurs huge losses
Holding nearly 50% of the domestic gasoline market, Petrolimex Group suffered huge losses last year, mainly caused by its subsidiary in Singapore.
Petrolimex Singapore incurred losses of about $31.38 million in 2014 due to the fall of oil prices and complicatedly geopolitical development in the world. The figures come from a report to the Minister of Industry and Trade Vu Huy Hoang last December by the representative of Petrolimex, Bui Ngoc Bao, who is Chair of Petrolimex.
The report showed that the main cause of losses came from the purchase of gasoline at a time when gasoline prices were high ($120.91/barrel on average) for stocking at the VanPhong bonded warehouse. As the oil prices fell later, the firm could not sell the gasoline, resulting in prolonged inventory.
At the same time, the derivative operations were also affected the same way, incurring losses of about $2 million.
"Petrolimex Singapore has incurred huge losses and is facing insolvency," the report said.
However, a report of Petrolimex showed many problems also related to management and administration of Petrolimex Singapore.
Petrolimex Deputy General Director admitted that Petrolimex Singapore’s losses had affected the production performance of the Group. He said the losses of Petrolimex Singapore were noted in the audit report. However, the cause of the losses has not been officially identified.
Petrolimex’s financial statements, audited by Deloitte and published recently, showed that the corporation had losses of more than VND9 billion in 2014, while in 2013 it earned nearly VND1.579 trillion of profit.
In November 2014, this group announced VND1.4 trillion for the January-September period of the year.
