S-Oil Corp., the No. 3 oil refiner in South Korea, said Wednesday that its second-quarter profit dropped 85 percent from a year earlier, as low oil prices drove up inventory losses.

Net profit reached 66.9 billion won ($59.8 million) in the April-June period, compared with 444 billion won a year earlier, the company said in a regulatory filing.

Operating income dropped 82 percent on-year to reach 117 billion won over the cited period, while sales rose 11.1 percent on-year to reach 4.67 trillion won.

S-Oil said its operating income dropped due to low oil prices, which cut into refining margins and jacked up inventory losses.

The company logged an operating loss of 85 billion won from its refining business, while its chemicals business racked up an operating income of 73 billion won.

Its lubricant unit also logged an operating income of 123 billion won.

During the first six months of the year, S-Oil posted an operating income of 451 billion won, down 60 percent from a year earlier. Its sales dropped 29.3 percent on-year to reach 9.87 trillion won in the January-June period.

Last year, S-Oil posted a net profit of 1.26 trillion won, compared with a profit of 631 billion won a year earlier. (Yonhap)