Petrol Will Not Achieve 2022 Set Targets Due to Government Regulation of Petrol Prices

The management board of Petrol has estimated that compared to its business plan, in the first half of 2022 company should achieve gross profit lower by EUR 53m, EBITDA by EUR 79m and bottom line by EUR 54m, due to previous and new regulations of motor fuels in Slovenia and Croatia regarding retail prices of petroleum products.

Today, the management board of Petrol reported the effect of motor fuel price regulation on the Petrol Group’s operations. The company estimated that compared to its business plan, in the first half of the year, Petrol should report gross profit lower by EU EUR 53m, EBITDA by EUR 73m and bottom line by EUR 54m. The company set its business plan with sales amounting to EUR 5.9 bn, EBITDA of EUR 297.8m and net profit of EUR 158.3m. This effectively means the company in 2022 expects EBITDA to reach EUR 224.8m and the bottom line amounting to EUR 104.3m. This is a direct effect of both previous and new regulations on motor fuels in Slovenia and Croatia. The company said it will carry out all activities necessary to receive compensation for the loss resulting from the disproportionate measure of the petroleum products regarding retail price regulation.

In Slovenia, there are currently caps on margins at service stations outside motorways in the period from 21 June until 16 August at EUR 0.0607 per litre, with the maximum permitted margin for diesel is EUR 0.0983 per litre and for petrol amounting to EUR 0.0994 per litre. In Croatia, regarding measures adopted by the government, fo a period of 14 days, regulations capped motor fuel prices at service stations outside motorways. Effectively starting from 21 June, petrol will cost HRK 13.5 per litre, diesel HRK 13.08 per litre and blue-dyed diesel HRK 9.45 per litre. The company emphasised the regulated retail prices outside motorways are not sufficient to cover the operating costs of these units.

Petrol emphasized it has been in a „strange situation“ – with the volumes sold exceeding the planned sales due to the significantly lower prices compared to those in the neighbouring countries, whereas it was forced to sell fuel below the cost of it, effectively generating a los with each litre of fuel sold. Petrol sold more than 90% of the fuel below the cost during the regulation period. Petrol addressed a loss compensation claim to the Government of the Republic of Slovenia for the loss resulting from price regulation of petroleum products and expects the government to fully meet its obligation in the shortest possible period. To read more, click here.

Category : Flash News

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