Valero's ethanol segment swings to operating loss in Q3 2012
Oct 31, 2012 - US oil refiner and ethanol producer Valero Energy Corp (NYSE:VLO) on Tuesday said its ethanol segment had turned to a third-quarter operating loss of USD 73 million (EUR 56.2m) against a profit of USD 107 million a year ago.
The company attributed the loss to notably lower gross margins due to high corn prices and high industry ethanol inventories, driven by lower ethanol and gasoline demand. Valero has cut production rates at several of its ethanol plants due to low margins.
Bloomberg said yesterday, citing an e-mailed statement by spokesman Bill Day, that Valero had closed its ethanol plants in Nebraska's Albion and Indiana's Linden cities. It plans to restart them when their operation becomes economically feasible, according to the report.
Valero's total operating profit decreased to USD 1.3 billion from USD 2 billion a year ago. Net profit declined to USD 674 million from USD 1.2 billion a year ago. The result includes USD 341 million non-cash asset impairment loss and USD 41 million severance costs.