* Good exports seen in Q4
* Retail separation seen next year
* MLP still an option
Oct 30 U.S. refining company Valero Energy Corp
on Tuesday said its quarterly profit fell, as margins
for its plants on the West Coast and U.S. Gulf Coast declined
from year-ago levels.
Valero and others have benefited as cheaper supplies of
domestic crude oil from vast shale formations in North America
are shipped to their plants. This quarter the company recognized
smaller discounts on crude oil and other feedstocks.
The company's results topped expectations on a
better-than-expected refining performance even as its ethanol
and retail units had a weak quarter, analysts at Houston-based
energy investment bank Simmons & Co, told clients.
The San Antonio-based company had a third-quarter profit of
$674 million or $1.21 per share, compared with $1.2 billion, or
$2.11 per share a year ago.
Excluding items, Valero had a profit of $1.90 per share.
Wall Street analysts had forecast earnings of $1.75 per share,
according to Thomson Reuters I/B/E/S.
In the fourth quarter, gasoline margins have narrowed
significantly, distillate margins and sour crude discounts
remain wide and exports are strong, Valero said.
The company is looking to take advantage of increased demand
in Brazil, Venezuela and Mexico.
"We think we can go into these (export) markets and be
doggone competitive," said Chief Executive Officer Bill Klesse.
For the full year, Valero said it will spend less than
originally projected. Spending is forecast at $3.5 billion, down
$100 million. For 2013, capital expenditures are estimated at
Valero said its plan to separate its retail operations was
progressing, with completion seen late in the first quarter or
early in the second quarter of next year.
After the separation, which may involve a spin off or sale,
Valero will consider forming a tax-advantaged master limited
partnership (MLP) for some of its terminal assets, Klesse said
on the conference call.