Valero posts loss, shares up on underlying profit

Tue May 1, 2012 1:34pm EDT

(Reuters) - Valero Energy Corp (VLO.N) made a quarterly loss due to smaller discounts on the crude it processes and charges for shutting its Aruba refinery, but the underlying performance was better than expected and its shares rose 1.7 percent.

The U.S. refiner said it continued to benefit from strong exports, even as weak demand at home cut its income per barrel processed by more than half compared with a year earlier, to $2.11.

"These export volumes have helped to offset weak domestic demand and contributed to higher operating rates at our refineries," Chief Executive Bill Klesse said in a statement.

Valero said the combined throughput of its 14 refineries was expected to be between 92 percent and 95 percent of its 2.765 million barrels in total capacity in the second quarter.

The net loss for the first quarter was $432 million, or 78 cents per share, versus a profit of $104 million, or 18 cents per share, a year earlier. Excluding one-time items, Valero earned 31 cents per share, 2 cents above analysts' average forecast, according to Thomson Reuters I/B/E/S.

Refining volumes in the quarter climbed 449,000 barrels per day to 2.56 million bpd due to the acquisitions of the Pembroke and Meraux refineries, the company said.

Valero exported 170,000 bpd of diesel in the quarter, the bulk of which went to Europe, and 80,000 bpd of gasoline that mostly went to Latin America, where there is a shortage of refining capacity.

"If you look at the factors that are affecting the export market going forward, I mean, they're not factors that can readily change," Chief Commercial Officer Joe Gorder said on a conference call.

Valero said it expects refining cash operating expenses in the second quarter to be about $3.85 per barrel, down from the first quarter due to higher plan throughput volumes and expected lower maintenance costs.

The San Antonio, Texas-based company undertook major refinery work during the first quarter, including shutdowns at its Wilmington and St. Charles refineries. Downtime in the quarter reduced pre-tax earnings by about $170 million, it said.

Shares of Valero, which had lost nearly 14 percent of their value since mid-March through Monday's close, were up 1.7 percent to $25.13 in Tuesday afternoon trading.

(Reporting By Matt Daily in New York and Braden Reddall in San Francisco; Editing by Gerald E. McCormick, John Wallace and Tim Dobbyn)

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