S-Oil Corp., South Korea's third-largest refiner, said Wednesday its second-quarter earnings rose more than six times from a year ago as low crude oil prices helped sustain cracking margins.
  

Net income came in at 430.53 billion won ($373.59 million) in the April-June period, up 531.1 percent from 68.2 billion won from a year earlier, S-Oil said in a regulatory filing.
  

Sales, however, declined 30.7 percent on-year to 5.14 trillion won, while operating profit swung to a profit of 613 billion won, the firm said.
  

The firm said it maintained the facility utilization rate at the maximum level to meet strong demand driven by low oil prices.
  

"In the second quarter, the business environment continued to be favorable to our company," said Bang Ju-wan, vice president of S-Oil, adding the global demand growth supported cracking margins at a "healthy level" for Asian refiners.
  

The operating profit, which exceeded market expectations, was the largest since the fourth quarter of 2011. A quarterly gain in Dubai crude prices also lifted the value of stockpiles to strengthen the operating margin.
  

Demand for petrochemical products picked up during the peak season, while heavy maintenance and a paraxylene plant shutdown in China following an explosion in April eased a global supply glut to increase margins, the firm said.
  

"Cracking margins have recently slipped compared to the second-quarter average," the company said. "However, stable demand amid low oil prices as well as delayed projects and shutdown of aged facilities in other countries will balance supply and demand to sustain the spread."
  

The company expected the petrochemical business to stay at the current level, while the lube oil division may suffer a decline due to an oversupply.      
  

The cracking business accounts for 78.9 percent of its sales, while the petrochemical and lubricant sectors took up 13.8 percent and 7.3 percent, respectively. The lube oil business had the highest margin rate of 21.3 percent, according to S-Oil. (Yonhap)