[Market Focus] S-Oil Surges Over 6% on Return to Profit in Q3

S-Oil is showing an upward trend on the back of strong third-quarter earnings this year.

As of 9:05 a.m. on November 4, S-Oil was trading at 76,800 won on the Korea Exchange, up 4,500 won (6.22%) from the previous day.

The previous day, S-Oil announced that it had posted an operating profit of 22.92 billion won for the third quarter of this year, successfully turning a profit compared to the same period last year. Revenue during the same period was 8.4154 trillion won, maintaining a similar level to the previous year (8.8406 trillion won). Jeon Wooje, a researcher at KB Securities, analyzed, "The main factor behind the return to profitability was the removal of the negative impact from falling oil prices and exchange rates that had been reflected in the second quarter," adding, "There were no additional holiday effects or scheduled maintenance in the third quarter." KB Securities estimates that S-Oil's annual operating profit will recover to 189.2 billion won this year and 1.04 trillion won next year.

Choi Younggwang, a researcher at NH Investment & Securities, predicted, "This year, the sharp drop in oil prices had a significant negative impact, but next year, as the decline in oil prices slows, robust refining margins will be fully reflected in earnings."