Neste shares rise 7.4% after strong Q3 results beat expectations

Investing.com -- Neste shares jumped 7.4% after the company reported third-quarter results that exceeded analyst expectations, primarily driven by strong operational performance.

The Finnish refiner posted a comparable EBITDA of €531 million, beating consensus estimates of €479 million by 11%. Net profit reached €179 million, surpassing the €169 million consensus forecast by 6%.

The Renewable Products segment delivered a comparable EBITDA of €266 million, slightly above the €261 million consensus. This performance was supported by higher comparable sales margins of $480 per ton versus expectations of $440 per ton, though sales volumes came in lower at 1,046 kilotons compared to the anticipated 1,118 kilotons.

The company noted that sustainable aviation fuel (SAF) sales increased to 251 kilotons from 233 kilotons in the second quarter, with a one-off positive contribution of €27 million from SAF BTC in the quarter.

Oil Products segment’s comparable EBITDA reached €232 million, exceeding consensus by 20%. This segment benefited from higher refining margins at $15.5 versus the expected $13, along with increased sales volumes of 3,057 kilotons compared to the forecasted 2,975 kilotons.

The Marketing & Services segment contributed €34 million in comparable EBITDA, slightly above the €32 million consensus estimate.

Cash flow from operations before working capital stood at €486 million, higher than analyst expectations of €454 million. Capital expenditure was 41% below consensus at €180 million. Net debt increased by approximately €73 million quarter-over-quarter, driven by a €283 million working capital outflow. The company’s leverage ratio remained stable at 38%, within its target of less than 40%.

Neste reduced its capital expenditure guidance to €1.0 billion from the previous range of €1.0-1.2 billion. The company maintained its outlook for renewable products sales volumes and oil products sales, while noting that the renewable fuels market is expected to remain oversupplied in 2025.

The CEO stated: "As we move forward, there will be more emphasis on improving our refinery performance."

Morgan Stanley analysts commented that they "expect a positive reaction to strong operating results, including a meaningful improvement in efficiency programme."

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.