Finland’s Neste shares dive as company reduces profit outlook

Published 15/05/2024, 10:34
© Reuters.
NESTE
-

Shares of Finnish oil refiner Neste Oyj plummeted more than 13% on Wednesday after the company warned that its comparable sales margin for renewable products would be weaker this year than previously anticipated.

In a statement released late Tuesday, the biofuels producer and oil refiner adjusted its margin forecast to $480–$650 per ton, down from the earlier guidance of $600–$800 per ton.

The rest of the guidance for the Renewable Products unit and the Oil Products division remains unchanged.

"Renewable Products' sales price outlook is affected by a decrease in the diesel market price and a continued decrease in U.S. bioticket and renewable credit prices during the second quarter, while waste and residue feedstock prices have remained stable," the company said.

Assuming no change in consensus sales volume estimates and using the midpoint of the current guidance range, Neste could face a potential negative impact of approximately €300 million to its EBITDA, Morgan Stanley estimated in a Tuesday note.

This represents about an 11% decrease from the consensus 2024 group EBITDA of €2.7 billion.

Analysts also highlighted that the current guidance range of $480-650 per ton for 2024 is lower than the consensus expectations of approximately $696 per ton for 2025 and $675 per ton for 2026.

“Neste has previously highlighted increases in mandates and SAF growth as some of the key drivers behind an y-o-y increase in sales margins. However, with the current downgrades seen for 2024, we expect a downward revision for 2025/26 sales margin estimates as well,” analysts wrote.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.