V.Chmn. Huh Jin-soo of GS Caltex.

V.Chmn. Huh is surrounded by key leaders of GS Caltex to reconfirm their determination to boost the oil refinery's performance in the days ahead at the 48th anniversary ceremony held on May 18.(Photos:GS Caltex)

Vice Chairman and CEO Huh Jin-soo of GS Caltex stressed a stronger organization at the oil refinery’s 48th anniversary ceremony on May 18 at GS Tower in Yeoksam-dong, Seoul.

The vice chairman had a reason to make such a statement at the ceremony, because the crude oil price has not yet recovered from the recent collapse, and Chinese oil refineries have been expanding their capacities.

“The business environment for the oil industry has been changing rapidly, and we need to make our oil refinery’s organization stronger to cope with the situation down the road, including tougher competition and a sluggish global oil market,” Huh said.

He said it is hard to predict where the global oil market is headed, and therefore GS Caltex ought to have an open mind and coldly analyze the current situation, and build a base for a resurgence.

He recalled that the oil refinery had a number of close calls in the past, including two oil shocks, the foreign exchange crisis and the global financial crisis, and overcame them to forge ahead with their future plans.

“We all have to learn to take care of small things well first including him and make effort to usher in a society where the company and its suppliers would grow together,” the vice chairman said.

GS Caltex has been able to turn its operation around successfully in the first quarter, with operating profit rising to 300 billion won as the oil refining sector made a profit for the first time since the third quarter of 2013.

The vice chairman told everyone at the oil refinery to be on alert, and not resting on the first quarter performance, to keep the oil refinery’s operation in the black in the days and months to come.

He pointed out four major tasks that they should work on to keep the oil refinery’s growth sustainable, including keeping the oil company’s financial structure strong to boost profit, strengthening the oil refiner’s organization, continued effort for change and reform of the oil refiner’s operation, being faithful to basics and passion to stick to the principles in practice, safe environment and smooth management and labor relations. 

GS Caltex announced that its operation turned a corner in the first quarter of this year, with operating profit rising to 303 billion won, up 272.2 percent year-on-year compared to a loss of 452.3 billion won in the first quarter of last year. The company said this year’s success is due mainly to the drastic fall in crude oil prices.

The oil refinery’s great performance boosted GS Group’s Q1 performance results to 198 billion won, up 187.5 percent year-on-year on sales of 2.784 trillion won and net profit of 140.4 billion won, which are up 5.2 percent and 215.2 percent, respectively, year-on-year.

Officials of the group attributed the excellent results to the turnaround in the operation of GS Caltex in Q1, boosting the group’s overall figures.

GS Caltex officials said the peak seasonal demand period for light fuel oils has arrived, while the price of crude oil has been rising, signaling that the oil refiner’s performance would continue to improve in Q2.

The oil refinery's Q1 sales amounted to 6.896 trillion won with operating profit coming to 303 billion won, down 36.5 percent and up 272.2 percent respectively year-on-year. The operating profit in the Q4 last year fell 452.3 billion won, but it went back up in the Q1 this year. The oil refiner's quick recovery in its performance also has been owed to the excellent performance in the petrochemical sector, which expanded 29 percent in sales at 90.8 billion won, but the lube oil sector did not fare well down 41 percent at 28.4 billion won in sales. The excellent outcomes in operation in the construction and petrochemical sectors help boost the group's overall performance in Q1 this year.