RPT-INTERVIEW-Czech Unipetrol sees flat EBIT this year

(Repeats story published late on Wednesday)

By Jan Korselt

PRAGUE, Oct 25 (Reuters) - Czech downstream oil processing group Unipetrol expects 2006 operating profit to remain flat this year, Chief Executive Francois Vleugels said on Wednesday.

Unipetrol, majority-owned by Poland's PKN Orlen, had earnings before interest and tax (EBIT) of 5.27 billion crowns ($233.9 million) last year.

"In general terms, we remain very optimistic about the end of the year," he told Reuters in an interview. "Our costs are very much under control, our margins are good, better than anyone expected."

Vleugels said that EBIT would be significantly higher without an October stoppage at its Litvinov refinery and subsidiary Chemopetrol.

"Despite that we expect to end the year on EBIT about the level of the last year," he said, adding that net profit could also be flat at last year's 3.46 billion crowns, but that would depend on how the company treats write-offs and one-off items.

Vleugels said Unipetrol had completed negotiations to sell its unit Spolana, and the deal would be announced in days.

Unipetrol has been in talks with Poland's AnWil, a unit of Unipetrol's majority owner PKN Orlen, on the sale of chemicals plant Spolana.

Unipetrol is also negotiating a sale of synthetic rubber unit Kaucuk to another Polish firm, Dwory. Vleugels said the deal should be completed by the end of the year.

LOOKING FOR ACQUISITIONS

He said revenue from the sales could be used for acquisitions or investments to improve efficiency, but a special dividend remained an option.

"There are always rumours about companies going to divest, exit Czech Republic and we are interested in these," Vleugels said.

One part of Unipetrol looking at acquisitions is fuel retailer Benzina. Vleugels said rather than buying a network he envisaged purchases of small groups of outlets in attractive areas.

Unipetrol has said it would be interested in raising its 51 percent stake in oil refiner Ceska Rafinerska but Vleugels said there were no negotiations with other shareholders under way.

Another outlay will be a 3 billion crown investment next year to raise efficiency and capacity at the Chemopetrol unit.

He said the current level of debt, at around 40 percent of equity, was healthy.

Vleugels added Unipetrol intended to raise its profile with investors through increased transparency.

The company has faced repeated calls from minority shareholders to raise the flow of information, mainly in connection with the sales of Kaucuk and Spolana.

"We want to be and we will be more transparent in the future," Vleugels said. "We will fix that both on the structural side of the house, meaning how Unipetrol is structured, and how we will deal with the outside world."

Unipetrol shares closed one percent higher at 207 crowns on Wednesday, lagging the market which rose 1.8 percent. It has lost 12 percent over the past 12 months, underperforming the Prague PX index which had gained 16 percent. ((Writing by Jan Lopatka, editing by Rory Channing; prague.newsroom@reuters.com; Reuters Messaging: jan.lopatka.reuters.com@reuters.net; +420-224 190 474)) ($1=22.53 Czech Crown)

Keywords: CHEMICALS CZECH UNIPETROL