* Q2 comparable EBIT 255 mln eur vs 221 mln consensus
* COVID delays Singapore expansion to 2023
* Shares jump over 14% (Adds CEO comment, details, updates shares)
July 23 (Reuters) - Finnish biofuel producer and oil refiner Neste reported smaller-than-expected falls in second-quarter sales and profit on Thursday thanks to its renewables business, sending its shares up more than 14% to a record high.
The stock surged even as the company said it had delayed the expansion of its Singapore refinery, its biggest investment to date, citing the COVID-19 pandemic.
“Without taking possible new waves of infections into consideration, the estimated start-up of the plant is moved from the middle of 2022 to the first quarter of 2023,” Neste said.
The delay raises the cost of the expansion by 100 million euros ($116 million) to 1.5 billion euros, it said, adding the expansion will increase the firm’s annual renewables production capacity to 4.5 million tonnes from 3.2 million.
The refinery produces renewable fuels mainly from waste and residues such as used cooking oil, animal fat from food industry waste, fish fat and residue from vegetable oil processing.
Neste said its April-June comparable operating profit fell to 255 million euros, above the 221 million expected on average by analysts, Refinitiv Eikon data showed.
“It was a strong quarter for renewables products,” CEO Peter Vanacker told Reuters. “Renewables proved to be very resilient and reached a new sales record.”
Shares in the company jumped 14.7% to 42.66 euros, valuing the firm at 32.8 billion euros.
The company’s renewables business unit, its main profit generator for years, reported comparable operating profit up 10% from a year ago to 314 million euros, while the other key unit of oil products reported a loss for the quarter.
Neste said renewable diesel volume would be relatively stable in the third quarter, while demand for oil products was set to improve from low levels with reference margin “expected to remain low and very volatile.” ($1 = 0.8645 euros) (Reporting by Tarmo Virki in Tallinn; editing by Emelia Sithole-Matarise and Elaine Hardcastle)
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