Neste reports strong Q1 performance for renewables division

By Erin Voegele | May 02, 2018

On April 26, Neste Corp. released first quarter 2018 financial results, reporting strong results for the company’s Renewable Products division. Overall, the company posted an all-time high quarterly profit.

“Neste had an excellent start for the year,” said Matti Lievonen, president and CEO of Neste. “We posted a comparable operating profit of EUR 401 million, an all-time high quarterly figure. With support from a retroactive application of the U.S. Blender's Tax Credit (BTC) for the full year 2017, the comparable operating profit was almost double compared to the EUR 204 million in the first quarter of 2017. Also without the BTC effect, Renewable Products was able to exceed the previous year's performance as a result of successful sales allocation and feedstock optimization.”

The Renewable Products division prosed an operating profit of EUR 296 million ($353.74 million), up from EUR 80 million during the first quarter of 2017. “The result was also supported by the retroactive [BTC] decision for the full year 2017, which had a positive impact of EUR 140 million on the comparable operating profit of this quarter,” Lievonen said.

Renewable Products sales volumes reached 550,000 tons, up slightly when compared to the first quarter of last year. While demand for renewable diesel continued to be strong, Lievonen said Neste’s production facilities experienced some operational disturbances and operated at an 89 percent utilization rate during the quarter.

Approximately 76 percent of renewable sales were allocated to the European markets during the first quarter, Lievonen said, with 24 percent gong to North America.

“Feedstock mix optimization towards lower-qualityraw materials continued successfully, and the proportion of waste and residue inputs was 81 percent,” Lievonen said. “First delivery of renewable propane was made from the Rotterdam refinery, which is the world's first large-scale renewable propane production facility.”

Overall, Neste reported EUR 3.629 billion in revenue, up from EUR 3.071 billion during the same quarter of last year. The increase is attributed to higher sales prices and higher sales volumes. The group’s operating profit was EUR 421 million, up from EUR 271 million during the first quarter of 2017.