Gunvor Group Ltd (“Gunvor”), one of the world’s leading independent commodities trading companies, today released results for the year ended 31 December 2020:
Gunvor recorded its highest-ever trading profit during 2020, with strong performances across all desks, including crude oil, oil products, LNG and natural gas. Thanks to robust earnings, the company continued to strengthen its balance sheet and enhance its liquidity position.
The company’s gross profit margin increased as Gunvor responded effectively to an extraordinary and unprecedented set of circumstances in the second quarter 2020, whereby the combination of sharp Covid-related demand destruction and an increase in supply by oil producers resulted in a massive contango structure. This situation created profitable trading opportunities. Gunvor continued to generate healthy trading margins in the second half in the context of oil producer cutbacks of almost 10 million b/d, along with demand recovery led by China. The company’s core profit drivers, such as natural gas and LNG, also continued to generate sustainable earnings throughout the year independent of market structure. Refining margins overall remained negative.
Gunvor’s net result of $320 million includes impairments of $340 million in relation to refining assets, whereby the company mothballed the Antwerp refinery and shutdown the two crude distillation units at the Rotterdam refinery, reducing the company’s total installed crude oil refining capacity from 300,000 b/d to approximately 100,000 b/d.