Pemex Cuts 2004 Losses 67% to US$1.27bn

Mexico's state oil company Pemex cut its net losses 67% in 2004 to 14.1bn pesos (US$1.27bn) from 42.8bn pesos in 2003, Pemex said in its earnings statement Tuesday.

Operating income in 2004 totaled 442bn pesos, up 14% from 2003. Excluding the special tax on production and services (IEPS), operating income grew 35%, or 99.7bn pesos, to 387bn pesos. The company's Ebitda increased 35% to 504bn pesos. Total sales increased 18% to 779bn pesos from 658bn pesos in 2003, while domestic sales increased 10% to 449bn pesos and exports increased 32% to 330bn pesos. Costs and operating expenses increased 24% with respect to 2003 to 337bn pesos. Cost of sales increased 27% to 277bn pesos. Transportation and distribution expenses increased 20% to 19.7bn pesos and administrative expenses increased 7% to 39.6bn pesos. Taxes increased 18% to 473bn pesos, the statement said. Pemex's comprehensive financing cost improved by 35.6bn pesos from 32.3bn pesos in 2003 to 3.3bn pesos in 2004.


Crude exports increased 1% year-on-year to average 1.87 million barrels a day (Mb/d) in 2004.

Approximately 87% of the total crude oil exports were Maya heavy crude oil and the rest was Isthmus light crude and Olmeca extra-light crude.

Crude oil and condensates exports increased 32% to 299bn pesos from 227bn pesos in 2003. Of the country's crude exports, 79% went to the US and the remaining 21% was distributed among Europe (10%), the Far East (2%) and the rest of the Americas (9%).

In a conference call Tuesday, Pemex CFO Juan José Suárez highlighted a 4% increase in crude oil exports for 4Q04 to 1.97Mb/d compared to the same quarter 2003. Approximately 85% of these exports were heavy crude, he said.

The average export price of the Mexican crude oil basket during the fourth quarter was US$33.32/b compared to US$25.03/b in 4Q03, the statement said.

In 2004 as a whole, the average export basket price increased US$4.24/b to average US$31.02/b, while the average price for natural gas was US$6.09 per million British Thermal Units (BTUs) compared to US$5.04/mBTU in 2003.

Refined products export sales rose 23% to 27.5bn pesos but the volume of refined product exports fell 15% to 152,000 barrels a day (b/d) due to a decrease in the exports of fuel oil, asphalt and jet fuel. Imports of refined products increased 8% to 310,000b/d in 2004 from 287,000b/d in 2003 as a result of higher demand for regular gasoline in urban areas.

Petrochemicals exports rose 70% to 2.7bn pesos and volume grew 10% to 916,000 tons. Petrochemicals imports decreased 48% to 277,000t as a consequence of the substitution of imports by increased domestic production. Natural gas imports increased 1% to 766 million cubic feet a day (Mft3/d) in 2004 from 757Mft3/d in 2003.


On December 31, 2004, Pemex's equity had increased 20% to 58.1bn pesos from 48.2bn pesos on December 31, 2003. The increase is primarily explained by the 32.6bn-peso equity contribution from the reimbursement of the duty for exploration, gas, refining and petrochemicals infrastructure.

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