NZ Refining's profits rise but stock drops

New Zealand Refining has posted an 11 per cent rise in half-year net profit to $83.2 million, benefiting from high margins for the low-sulphur fuels it produces.

The company expected healthy margins to continue but not at present levels, because other refiners were now able to meet regional demand for high-quality, low-polluting fuel.

"Consistently high margins have been available for refineries that have 'clean fuel capability' and high availability," NZ Refining said.

Margins rose 15 per cent for the six months ended June 30 to $US8.95 per barrel, including a record margin of $US10.79 a barrel for March-April.

Shares in NZR, which declared a dividend of 10c a share, fell 60c to $7.50.

- NZPA