Morning. This is Katie Bang, Treasurer of S-Oil. I would like to extend my gratitude to our investors and analysts in and out of Korea for joining S-Oil's conference call for Q4 2025 earnings result. For today's conference call, we have CFO JW Bang, IR Team Leader YR Jang, and team members. First, I will take you through the highlights of Q4 results. In Q4, the company's operating income significantly improved from the previous quarter and year-on-year, recording KRW 424.5 billion. Operating income of refining and lube businesses surged thanks to strong product spreads. Petrochemical business also witnessed reduced loss, supported by continued recovery in PX spread. Next is market outlook. In 2026, we are expecting favorable market condition driven by global demand growth that outpaces net refining and the PX capacity expansion. Refining margin is projected to remain stable thanks to less cost burden resulting from lower oil prices and OSP. Next is the progress of the Shaheen Project. EPC progress of Shaheen Project is 93.1% as of January 14th. We are making progress as planned ahead of a mechanical completion in the first half of this year. We are at the final stage of engineering and procurement, progressing at 97% and 99%, respectively. Construction is 86% complete. Our goal is to start commercial operation early next year after going through commissioning in second half this year. We are also working on annual term supply contract with olefin monomer customers based on the upcoming startup of Shaheen Project. Pipeline connection to key customers in Ulsan is ongoing as well. For PE, pre-marketing activities are underway to expand our PE customer base. We are in discussion to make term export agreement. We'll leverage all our capabilities to ensure the successful delivery of the project and live up to the expectations of investors. Now, Team Leader YR Jang will get into more details for Q4 performance with the following slides. Good morning. This is S-Oil IR Team Leader, YR Jang. Before we begin, please be noted that Q4 2025 financial results are provisional and therefore subject to change according to outside independent external auditors' audit results. First, please refer to page five for Q4 2025 financial results. The company's Q4 sales revenue recorded KRW 8,792.6 billion, up 4.5% from the previous quarter. Operating income jumped by 85% quarter-on-quarter to KRW 424.5 billion. If you look at each business segment, operating income of refining business surged from the previous quarter, recording KRW 225.3 billion, backed by strong spread of major products. Petrochemical business witnessed its operating income narrowed to KRW -7.8 billion as PX spread continued to recover. Operating income of lube business also went up by 55% from the previous quarter, recording KRW 209 billion, driven by widened product spread. For your reference, inventory-related impact reflected to Q4 operating income is KRW -87.4 billion. In finance and other income, we had KRW -56.9 billion of net interest gain and KRW 73.5 billion of net FX gain due to increased FX rate. Q4 income before tax and net income recorded KRW 317.9 billion and KRW 265 billion, respectively. On an annual basis, the company's 2025 operating income inched down year-on-year, recording KRW 288.2 billion. We swung sharply back into black, posting KRW 225.8 billion and KRW 216.9 billion in income before tax and net income, respectively. Moving on to financial status. The company's cash balance as of 2025-end is KRW 1,843 billion, and net debt to equity ratio is 67.9%. Despite volatilities in the external environment, the company has maintained enough liquidity and stable financial structure by financing at competitive interest rate right on time, and managing working capital proactively to ensure smooth execution of Shaheen Project. Cumulative EBITDA on a whole year basis stood at KRW 979 billion. I'll go through market environment and outlook by each business segment. First is refining business. Dubai crude price declined during Q4 due to concerns over added supply, resulting from OPEC+ output increase, falling from an average of $70 in September to $62 in December. In Q4, operational glitches of global facilities tightened the supply in the Asian refining market. Nigeria's new facility, Dangote Refinery, El Segundo Refinery in California, and Al Zour Refinery in Kuwait all experienced operational disruption. Ukraine's drone attack disrupted the operation of Russia's refining facilities, and shutdown of Phillips 66 Refinery in California affected market fundamentals as well. In addition, sanctions on Russia imposed by the U.S. and EU added worries over product supply interruption at a time when demand for diesel and kerosene remained healthy because of the high heating season in the Northern Hemisphere. As a result, spread of diesel and kerosene rose sharply to $25 per barrel on average, driving refining margin improvements. Despite downward adjustment in the end of the quarter, following ceasefire negotiations between Russia and Ukraine, diesel and kerosene spread is still maintained at a healthy level of roughly $20 per barrel. In Q1 2026, we're expecting limited supply to continue due to continuous operational disruption of the Dangote Refinery and Russian refineries, as well as scheduled closure of a Valero refinery in California, amid firm demand of products including diesel and kerosene. As we enter into regular T&I season in the region from late March, demand for inventory build-up may provide additional support to refining margin. I will share more details on 2026 annual outlook and key business update with the specific data. Petrochemical business segment. Operating income of a petrochemical business narrowed in Q4 from the previous quarter, recording minus KRW 7.8 billion as a result of upward trending PX spread over Naphtha and PO spread over propylene. Q4 market conditions, the PX market continued its bullish run backed by startup of a new PTA facilities in China that drove up PX demand and robust downstream polyester demand. As a result, PX Naphtha spread recorded $266 per ton in Q4. Even though Q4 is off-season, strong demand is keeping PX spread high at above $300 since mid-December. By contrast, benzene market continued bearish sentiment as imposition of a tariff lowered U.S. import demand, and benzene downstream facilities, including Styrene Monomer, operated at a low level. In Q4, benzene Naphtha spread stood at $103 per ton. As for olefin downstream, PP spread over propylene recorded $30 per ton, down from the previous quarter as supply increased after the completion of regular T&I. IOC spread went up from the previous quarter to $176 per ton due to disrupted supply of major PO manufacturers in China and seasonal demand supported by Black Friday and Christmas. Next is Q1 2026 outlook of a petrochemical business segment. We project PX market to stay bullish based on expectations for tight market fundamentals and regular T&I of PX production facilities in the region that will reduce the supply. We will further explain tight supply-demand balance outlook in key business update with the specific data. As for benzene, PP, and PO, we are forecasting supply to increase continuously for all products due to new facilities starting up mainly in China. Spring T&I in the region is expected to partially offset supply increase of benzene. At the same time, demand for PP and PO is anticipated to improve gradually as uncertainties around global trading environments start to ease. Next is the lube business segment. Operating income of lube business in Q4 went up from the previous quarter to KRW 207 billion. Despite the seasonal demand slowdown, LBO spread rose quarter-on-quarter due to lagging effect driven by lower the feedstock cost, recording $55.2 per barrel. Q1 this year, inventory build-up ahead of spring lubricant changing season is projected to support market sentiment, offsetting added supply caused by regional capacity expansion. Though we are expecting highly volatile LBO spread affected by price fluctuation of feedstock, including crude, we will make utmost effort to maximize our income by responding swiftly to changing market conditions. Next is key business updates. First is outlook on the business environment. We project bullish market sentiment as global demand growth for oil and PX will outpace net addition from capacity expansion. Starting from the left bar graph, global oil demand is expected to grow by 1 million BB, exceeding net addition of 790,000 BB, generated both from capacity expansion and closure of refining facilities. This tight market fundamentals will go beyond 2026, and supply will fail to catch up with the demand, which is expected to support a favorable business environment for refining business. Moving on to the bar graph at the center. PX demand growth outlook in 2026 stands at 3.75 million tons. In contrast, net PX capacity expansion will be limited to 1 million ton. Moreover, market expectations on tight supply-demand balance of PX are running high for this year, as market intelligence suggests added capacity will start up at the end of this year. We also expect lower oil price and OSP for Saudi Arab crude to ease cost burden on the company. The graph on the right shows OSP trend for Saudi Arab Light crude. OSP for crude that will trade in Q1 2026 stands below past five-year average, which means it will likely have a positive impact on the company's refining margin. Last is the progress of Shaheen Project. EPC progress rate as of January 14th is 93.1%, going smoothly as planned. Engineering and procurement progress rate is nearing completion at 97% and 99%, respectively. Based on pre-mechanical completion, engineering is complete and all that remains is as-built drawing work scheduled in Q2. As for the progress of EPC in further detail, we completed the mechanical installation of steam cracking furnace, installation of TC2C high pressure heat exchanger, and construction of a polymer automated warehouse. We are also working on installation of storage tank, above ground pipeline and conduit. As for marketing activities, we are discussing annual term contracts with major customers considering Shaheen Project start up. Currently, we are building branch pipeline to support sales to our key customers in Ulsan and targeting completion in the first half of this year. Speaking of PE, we are carrying out quality evaluation and supply to customers through pre-marketing. We are also securing more customers and discussing term export contracts. There is no change in project schedule. We are targeting first half of 2026 for mechanical completion and second half for start-up to be ready for commercial operation. We will keep you updated on the progress of Shaheen Project. This concludes my presentation. Thank you. 그럼 지금부터 질의응답을 시작하겠습니다. 질문이 있으신 분들은 전화기 버튼의 별표와 1번을, 별과 1번을 눌러주십시오. 신청하신 질문을 취소하시려면 별표와 2번을, 별과 2번을 눌러주시면 됩니다. Q&A session will begin. Please press asterisk 1, asterisk and 1, if you have any questions. For cancellation, please press asterisk 2, that is asterisk and 2 on your phone. 처음으로 질문해 주실 분은 신한투자증권의 이진명 님입니다. 질문해 주십시오. The first question will be given by 이진명 from Shinhan Investment & Securities. Please go ahead. 네, 안녕하세요. 신한투자증권 이진명입니다. 먼저 질문 기회 감사드리고요. 두 가지 질문드리도록 하겠습니다. 일단 첫 번째 질문은 저희가 1분기 전망에 대해서 말씀 주실 때 공급 차질에 대해서 말씀해 주셨는데, 1분기 때 발생 가능할 것으로 예상되는 설비 트러블 규모가 어느 정도 되시는지 말씀을 부탁드리고요. 그다음에 두 번째 질문은 글로벌리 증설 스케줄에 대해서 올해와 내년도 증설과 폐쇄 규모를 각각 breakdown 해서 말씀해 주시면 감사하겠습니다. Good morning. This is 이진명 from Shinhan Investment & Securities. Thank you for the opportunity to pose questions. I have two questions. First is on the global supply interruptions or disruptions in the first quarter of this year. How big will that be in this quarter? Second question has to do with the global expansion schedule for 2026 and 2027. I would like you to break it down into the expansions and the shutdowns. 네, 먼저 글로벌 공급 차질 현황에 대해서 답변드리겠습니다. 우선 발표에서도 말씀드렸던 것과 같이 4분기에는 미국 서부 지역의 폐쇄, 그리고 Dangote Refinery의 가동 차질, 그리고 우크라이나의 드론 공격에 따른 러시아 공급 차질 등 여러 가지 요소가 있었는데요. 1분기가 어떻게 될지 위주로 먼저 말씀드리고자 합니다. To answer your first question on the global supply disruptions, as I said during my statement, in Q4, there were several factors that caused the supply disruptions. The Dangote Refinery in Nigeria had a shutdown. The U.S. West Coast also had a permanent shutdown. There were also the drone attacks by Ukraine against Russian refineries. 우선 미 서부 지역의 폐쇄는 발표된 대로 진행이 되고 있습니다. 16만 BD의 Phillips 66 LA Refinery는 작년 10월 단계적 셧다운을 진행해서 12월 말에는 완전 폐쇄된 것으로 확인되었습니다. 올해 폐쇄될 것으로 발표된 15만 BD의 Valero Refinery는 올해 2월부터 단계적 셧다운을 시작해서 4월 중 대부분의 설비 폐쇄가 완료될 예정입니다. Starting with the shutdown in the U.S. West Coast, the 160 MBPD Phillips 66 Refinery based in Los Angeles started the phase shutdown from October last year. We understand that they had a full and complete shutdown at the end of December. For the 150 MBPD Valero Refinery, which was announced to shut down this year, it is planned to have a phase shutdown from February this year, and their plan is to have most of it shut down by April this year. 한편, 지난 3분기 중 가동 차질이 발생했던 미국 El Segundo Refinery 및 쿠웨이트의 Al Zour Refinery는 지난 연말과 올해 초부터 재가동을 시작한 것으로 파악이 됩니다. 그리고 2025년 연중 가동 차질을 겪던 나이지리아 Dangote Refinery의 RFCC는 1월 현재 정기 보수 진행 중입니다. As for the El Segundo Refinery in the United States and Al Zour Refinery in Kuwait, both of which had supply disruptions, operational glitches in Q4 last year are known to have started up again at the end of last year and the beginning of this year. For the Dangote Refinery in Nigeria, which had operational glitches throughout 2025, is in the middle of T&I of its RFCC in January this year. 러시아 정제설비의 경우에는 작년 하반기부터 우크라이나의 드론 공격으로 11월에는 CDU 설비 기준 약 50만 BD, 12월에는 약 30만 BD 이상이 가동 차질 영향을 받은 것으로 파악되고 있습니다. 정유공장뿐만 아니라 러시아 해상 유정 시설 및 항구 수출 터미널도 공격 대상이 되어서요. 가동 차질을 겪고 있습니다. As for the Russian refineries, Ukraine continued their intensive drone attacks on their refining facilities in Russia from the second half of last year. Based on the CDU capacity, about 500,000 BD in November last year and about 300,000 BD in December last year were affected because of the operational glitches. Not only the refining facilities, but the offshore oil field facilities in Russia and the export port terminals are also targeted by the drone attacks, which is also resulting in operational glitches as well. 정기 보수에 대해서도 조금 말씀드리면 글로벌 정기 보수 규모는 봄철 정기 보수 시즌에 접어들면서 점차 늘어날 것으로 예상되고, 4월에는 780만 BD 수준에 달할 것으로 보입니다. As for the global T&I, it is going to enter into the T&I season in spring and will gradually pick up to reach 7.8 million BD in April this year. 다음으로 답변 마치겠습니다. This concludes my answer. 다음으로 글로벌 증설 스케줄에 대해서 답변드리겠습니다. 2026년에는 79만 BD의 정제설비 순증설이 예정되어 있는데, 증설은 159만 BD, 폐쇄는 80만 BD로 예정이 되어 있습니다. 이 중 대부분의 신증설이 하반기에 집중되어 있습니다. As for the global expansion schedule in 2026 and 2027, for this year, the net increase of the refining capacities is 790 MBD. If I break it down, the capacity expansion is 1.5 million BD and the shutdown is 800 MBD. Most of these new capacity expansions are clustered in the second half of the year. 신규 물량은 주로 인도를 중심으로 증설되는 것으로 파악하고 있습니다. 인도의 경우에는 기존에 발표된 일정보다 증설이 지연되는 경우가 많아서 올해 예정되어 있는 증설 중 일부는 연말 또는 내년으로 지연될 가능성이 있을 것으로 보고 있습니다. As for the new expansions, we understand that most of it will take place in India, there is a tendency in India for these capacity expansions to be delayed to some extent. Some of it will be delayed to the end of the year or even next year. 2027년의 경우 순증설이 5만 BD에 불과합니다. 증설은 14만 BD, 폐쇄는 9만 BD로 보고 있습니다. 그리고 2028년은 증설 설비와 폐쇄 설비의 규모가 거의 비슷하여 순증분 규모로 보면 증설량이 없을 것으로 예상이 되고 있습니다. 참고로 증설은 30만 BD, 폐쇄는 30만 BD입니다. As for 2027, the net increase is only 50 MBD. If I break it down into the expansion and the shutdown, the expansion is 140 MBD and the shutdown 90 MBD. For 2028, the capacity expansions and the shutdown will almost balance out each other, which means there will be no net increase on expansion, 300 MBD and shutdown 300 MBD as well. 이에 따라서 수요 증가분이 공급을 상회하는 구조적으로 긍정적인 환경이 장기화될 가능성이 높을 것으로 예상하고 있습니다. As a result, we're expecting the demand increase to outpace the supply increase, which will create a favorable market fundamentals to the company in the longer term. 감사합니다. That's just the end of my answer. Thank you. 다음으로 질문해 주실 분은 한화투자증권의 이용욱 님입니다. 질문해 주십시오. The following question is by 이용욱 from Hanwha Investment & Securities. Please go ahead. 안녕하세요. 한화투자증권 이용욱입니다. 질문 기회 감사드립니다. 저는 세 가지 질문이 있는데요. 일단 최근에 OSP가 하향 추세가 이어지고 있는데, 당사에서 보는 이렇게 하향 추세가 이어지는 원인과 향후 전망에 대해서 공유 부탁드리고요. 두 번째로는 2026년 저희 정기 보수 계획도 공유 부탁드리겠습니다. 그리고 마지막으로는 샤힌 프로젝트 일정도 업데이트 부탁드립니다. Good morning, this is 이용욱 from Hanwha Investment Securities. Thank you for the opportunity to pose questions. I have three questions. First is, we're seeing the OSP in a downward trend. Could you tell us what is causing this downward trend, and how do you see its outlook? Second is, what is S-Oil's T&I plan and schedule for 2026? Third is, could you update us on the Shaheen project schedule? 네, 먼저 OSP 하락에 대해서 말씀드리겠습니다. OSP는 작년 11월 이후 하락하는 모습을 보이고 있습니다. Arab Light 기준으로 12월 산정 OSP는 배럴당 $1.0, 1월은 $0.6, 2월은 $0.3으로 발표되었습니다. To answer your first question on why OSP is coming down, it has been coming down since November last year based on Arab Light. The December lifting OSP was $1 per barrel, January lifting $0.60 per barrel, and February lifting $0.30 per barrel. 이런 OSP의 점진적인 하락으로 당사는 원가 측면에서 긍정적인 상황이며, 하락한 OSP는 당사 1분기 실적에 의미 있게 반영될 예정입니다. 최근의 OSP 하락은 러시아, 우크라이나 종전 협상으로 인한 종전 가능성과 글로벌 원유의 충분한 공급 상황 등이 반영되는 것으로 보고 있습니다. This downward trend of the OSP is working in favor of the company in terms of the cost structure. This lower and bearish OSP will be reflected in the company's Q1 performance in a meaningful way. We attribute the latest downward trend of OSP to a number of factors. The ceasefire talks between Russia and Ukraine is raising the possibility of end of the war, and the global market has ample supply of crude at the moment. 여러 시장 지표들을 고려했을 때 마이너스 OSP까지도 추후 가능한 상황입니다. 다만 미국 관세와 지정학적 이슈 등 글로벌 변수에 의해서 OSP 변동성이 확대될 가능성이 있기 때문에 향후에도 지속적으로 모니터링할 예정입니다. Considering these various market indicators, there's also a possibility of the OSP falling below zero. However, there are a number of factors that could escalate the volatility of OSP, such as the tariff issues stemming from the United States and other geopolitical issues. Therefore, we plan to constantly monitor the OSP trend going forward. 다음으로 올해 정기 보수 계획에 대해서 답변드리겠습니다. 회사는 금년 3월경부터 No.2 CDU, No.1 PX, No.2 RFCC, PP, QPP, OPP 설비의 정기 보수를 약 1개월에서 2개월 사이로 진행할 계획입니다. To answer your second question on the company's T&I plans for 2026, we are going to have a turnaround for the No. 2 CDU, No. 1 PX, No. 2 RFCC, PO and PP plant starting from March this year, and it will last for one month or two. 구체적인 정기 보수 일정은 회사 내외부 상황에 따라서 유동적일 수 있으며, 정기 보수 기간에 대비하여 재고를 비축하고 전사 마진을 최대화하는 공정 가동 최적화를 통해서 기회 비용을 최소화하고 수익성을 극대화할 계획입니다. The details of schedules are subject to change depending on the circumstances in an attempt to stockpile the inventory and optimize the process operations in a way that maximizes the company-wide margin. By doing so, we plan to keep the opportunity cost to minimum and maximize profitability. 이상으로 답변 마치겠습니다. This answers your question. Thank you. 샤힌 프로젝트 남은 일정에 대해서 답변드리겠습니다. 아까 발표에서 말씀드린 바와 같이 기계적 완공을 마치고, 올해 하반기에는 시운전을 거쳐서 내년 초 상업 가동을 목표로 하고 있습니다. 이 외에도 남은 투자 금액과 아까 발표에서 언급된 바 있는 마케팅 플랜에 대해서 추가적으로 설명드리도록 하겠습니다. To update you on the Shaheen Project and schedule, as we stated earlier, we have the MC target, mechanical completion target in the first half of the year. In the second half of the year, we are going to do the commissioning and commercial operation at the beginning of Other than that, I would like to elaborate more on our investment balance and our marketing plan as well. 샤힌 프로젝트 투자 규모와 관련해서 총 투자비 9조 2,580억원 중에서 작년 말까지 약 7조 6천억원 집행되었고, 올해 남은 집행 규모는 약 1조 6,400억원입니다. The total investment for Shaheen Project is KRW 9.258 trillion, until the end of last year, we executed KRW 7.6 trillion. The balance for this year is KRW 1.64 trillion. 샤힌 상업 가동을 앞둔 마케팅 플랜에 대해서 좀 더 추가적으로 설명을 드리면, 당사는 샤힌 프로젝트 FID 이후에도 울산 단지 내 주요 고객사들과의 판매 확대를 위한 다수의 MOU를 체결한 바 있으며, 최근에는 2026년 하반기에 진행될 스타트업을 고려하여 연간 공급 계약 체결을 위한 협의를 진행 중에 있습니다. On the marketing plan for Shaheen Project, after the commercial operation, we've actually signed a number of MOUs with our customers in Ulsan Industrial Complex to sell our products. The MOUs were all signed after this FID of our project. We are also discussing with our customers to sign the annual supply contract with them, starting from the second half of this year. 고객사와의 배관 연결 관련해서는 온산과 울산을 연결하는 간선배관 스위치는 완료하였고, 각 고객사와 연결되는 지선배관 스위치는 상반기 완료 목표로 진행 중입니다. As for the pipeline connection with our customers, we've also constructed the pipelines that will connect Onsan and Ulsan. For the branch pipelines that will take all our products to our customers in Ulsan area, we plan to complete them in the first half of this year. 마지막으로 폴리에틸렌과 관련하여 프리마케팅에 대해서 설명드리면, 당사 폴리에틸렌 플랜트와 동일한 공법을 적용하여 생산된 제품을 구매하여 주요 국내 고객사에 공급하고, 이에 대한 품질 평가를 진행 중에 있습니다. 그리고 장기 수출 계약 협의도 진행 중에 있습니다. As for the pre-marketing of the company's polyethylene, we have purchased the products that have the equal specification that we will be getting from our new PE plants. We purchased them, we supply them to our customers in Ulsan, the quality test is underway. Also, there are discussions with our customers overseas to sign term export contract as well. 네, 이상으로 답변을 마치겠습니다. This answers your question. 다음으로 질문해 주실 분은 삼성증권의 조현열 님입니다. 질문해 주십시오. The following question is by Jo Hyun-yeol from Samsung Securities. Please go ahead. 안녕하세요. 삼성증권 조현열입니다. 질문 크게 네 가지 드리도록 하겠습니다. 첫 번째로 4분기 이후에 등유 마진이 감소하고 있는데, 그 배경과 향후 추가 전망에 대해서 말씀해 주시면 감사드리겠습니다. 두 번째는 베네수엘라 이런 등 최근 발생한 지정학 리스크가 그리고 그 이벤트가 당사 업종에 어떤 영향을 미칠지에 대해서 말씀해 주시면 감사드리겠고요. 세 번째는 PX인데요. 최근에 PX 스프레드도 좀 감소했는데, 그 배경이랑 향후 전망에 대해서 한 번 더 말씀해 주시면 감사하겠습니다. 네 번째로는 전체적으로 봤을 때 연간 실적으로 보면 2025년 대비 2026년에 거의 종사 실적이 의미 있게 개선될 것 같은데, 그러면 향후에 배당 확대 가능성은 어떻게 봐야 될지에 대해서 말씀해 주시면 감사하겠습니다. 감사합니다. I am Jo Hyun-yeol from Samsung Securities. I have four questions. First is, since Q4 last year, the kerosene and diesel margin is quite strong. What is the background behind this and what is your outlook? Second question is, how do you think the latest geopolitical events, such as the ones in Venezuela and Iran, will have on the company's business? Third is, what is behind the strong PX market these days, and what is your outlook? Fourth is, the company's 2026 performance is likely to be better than the last year. Do you think this will have an opportunity to expand the company's dividends? 먼저 등경유 마진 강세 배경에 대해서 말씀드리겠습니다. 먼저 4분기 등경유 스프레드 강세에 대해서 간략하게 설명드리겠습니다. 동절기 북반구 지역의 난방유 성수기 시즌에 따라서 등유 수요가 견조하게 뒷받침되었습니다. 또한 연말 연휴 시즌에 따라서 견조한 항공 수요, 그리고 LA 소재의 Phillips 66 리파이너리 영구 폐쇄로 미국향 수출 물량이 증가하면서 등경유는 강세 흐름을 보였습니다. To answer your first question. Since Q4 last year, the diesel and kerosene spread was very bullish. First of all, the high season for heating fuel in the northern hemisphere and the winter season boosted the demand for kerosene. Also there was some strong jet fuel demand during the year-end and year beginning holiday season. The permanent shutdown of Phillips 66 refinery in Los Angeles caused more export volume towards the United States, which all added up to keep the spread strong. 이외에도 유럽과 미국의 러시아산 원유와 제품에 대한 제재가 강화되었고, 우크라이나의 드론 공격에 따라서 러시아 물량이 감소하면서 타이트한 시황이 이어진 것도 강세 요인으로 작용했습니다. The market was further tightened by tightened sanctions against Russian crude oil and products by the EU and the U.S., and the continuous drone attacks by Ukraine, which dropped the volume out of Russia. 현재 스프레드 상황을 설명드리겠습니다. 가동 차질을 보였던 일부 물량이 가동되기 시작하면서 현재 스프레드는 4분기에 높았던 수준 대비로는 낮아졌지만 등경유 스프레드는 여전히 양호한 흐름을 보이고 있습니다. As for the latest market conditions, some of the facilities that had operational glitches are back on track now. As a result of that, the spreads are slightly narrower compared to Q4. However, the spread is still maintaining a solid trend. 향후 스프레드는 러시아, 우크라이나 종전 협상 등에 따라서 변동성을 보일 것으로 예상하고 있지만, 난방유 수요가 1분기 말까지도 이어지고 있는 상황이고, 연초 연휴 관련 수요가 견조하게 뒷받침되고 있습니다. 또한 러시아 제재와 타격에 따른 공급 영향이 현재에도 이어지고 있어서 현재의 시황이 지지될 것으로 보고 있습니다. Going forward, how the ceasefire talks between Russia and Ukraine play out could create some volatility in the market. However, we're expecting the market conditions to be supported by a number of factors. The demand for heating fuel will continue towards the end of this quarter. The end of the year and beginning of the year is creating solid demand, and there is also sanctions against Russia and the drone attacks against Russia, which is impacting supply. 이상입니다. This is the end of my answer. 다음 질문, 글로벌 지정학적 갈등이 업황에 미칠 영향에 대해서 설명드리도록 하겠습니다. 베네수엘라와 이란에서 발생한 지정학적 갈등은 단기적으로는 유가에 상방 압력으로 작용했습니다. 하지만 그러한 상방 압력이 오래 지속되지는 않는 모습을 보여주고 있습니다. 회사에서 유가에 대한 전망을 구체적으로 제시드리지는 않지만 여러 가지 시장의 뷰를 종합해 보면 이런 지정학적 갈등은 유가에 단기적인 영향은 미치겠지만, 장기적으로는 글로벌 원유 공급 증가 추세로 인해서 보고 있습니다. To answer a second question on how the geopolitical situations in Venezuela and Iran, the cold conflicts had an upward pressure on oil price in the short term, but they don't last for a long time because if we combine all the market views, when there is a geopolitical confrontation, they do affect the oil price in the short term. However, in the longer term, they have little impact. This is because there is a trend towards higher supply of oil in the global market, and therefore we believe in the longer term, oil price will come down. 정제마진 측면에서 말씀을 드리면, 중국의 소규모 정제시설에서 베네수엘라산 원유 그리고 이란산 원유를 수입해서 정제한다고 알려져 있습니다. 베네수엘라산 원유가 중국 대신 미국 유입이 증가되고, 이란의 원유 수출이 축소될 경우에는 중국 한 개의 업체로의 값싼 원유 공급에 차질이 발생하게 됩니다. 이는 중국의 한계업체 가동률 하락으로 이어져서 아시아 정제마진에 긍정적인 영향을 미칠 것으로 기대하고 있습니다. To speak on the refining margin, it is known that the small refineries in China are importing crude from Venezuela and Iran. If more Venezuelan crude oil flows into the U.S. in lieu of China and Iran's crude exports go down, this means there will be some disruptions and interruptions in supplying cheap crude oil to these marginal players in China. This will lower their operation rate and will hopefully have a positive impact on the refining margin in Asia. 덧붙여서 시점이나 가능성에 불확실성이 있긴 하지만 Venezuela heavy and sour 원유 생산이 확대될 경우에는 원유 공급이 증가하고 Venezuela산 원유가 중동 heavy oil과 경쟁이 확대되면서 OSP가 하락되어 가지고 당사 원가의 부담을 줄여줄 것으로 예상됩니다. Although the timing and the likelihood remain uncertain, if more heavy and sour crude oil is produced from Venezuela, that will create intensified competition between the oil from Venezuela and the heaviest oil from the Middle East, which could lower the OSP on top of more crude oil into the market. This will hopefully ease the cost burden on the company. 다음으로는 PX 시황의 지속 가능성 전망에 대해서 설명드리겠습니다. 앞서 발표에서 설명드렸던 것과 같이 최근 PX 스프레드는 견조한 downstream 수요를 바탕으로 $300이 넘는 수준으로 유지되고 있습니다. 2026년 연간으로도 역내 PX 증설이 제한적인 가운데 매년 4%에서 5% 사이에 달하는 중국 downstream polyester 수요 성장이 시장을 지지할 것으로 기대하고 있습니다. To answer your third question on the sustainability of the PX market conditions and its outlook, the spread has been over KRW 300, thanks to the strong demand from the downstream side. For this year, the regional PX capacity expansions are limited, whereas the polyester demand, which is the downstream in China, will show a strong growth of 45%, which will support the market, and we're expecting this situation to continue. 좀 더 구체적으로 1분기에는 역내 PX 설비 정기 보수 집중으로 공급이 제한될 것으로 보이고, 2분기, 3분기에는 미국 드라이빙 시즌과 함께 휘발유 blending 수요가 증가해서 PX 시황이 지지될 것으로 예상됩니다. If I break it down into quarter by quarter, in Q1, the supply will be limited because of the intense T&I of the PX facilities in the region. In Q2 and Q3, there will be higher demand for gasoline blending because of the driving season in the United States, which will support the PX market. 중장기적인 시선에서 보면 경쟁력 없는 PTA, polyester 업체들이 가동을 중단하면서 공급 과잉이 일부분 해소되고, 그로 인해서 대형 업체들의 마진이 개선될 것으로 보고 있습니다. 점진적으로 증가하는 polyester 수요에 맞춰 대형 업체들의 가동률이 추가적으로 개선되고, 이에 따라 PX 수요가 증가하여 시황이 양호할 것으로 예상하고 있습니다. If I look at the market in the longer term, the less competitive PTA and polyester players will shut down, which will partially ease the oversupply and subsequently improve the margin of the bigger players. In line with the gradually growing demand for polyester, the bigger players will have to additionally improve their operational rate, which will support the PX demand and the market conditions. In the mid to long term, we are expecting the market conditions to be favorable. CFO 방주환입니다. 마지막 배당, 미래 배당과 관련해서 질문 주셨는데요. 회사는 경영 성과나 재무 구조, 미래 투자 재원 확보 및 주주 환원 등을 종합적으로 고려해서 장기적인 주주 가치를 최대화하는 방향으로 배당을 실시하고 있습니다. 지난 25년 2월에 공시를 통해서 안내드린 바와 같이, 금년 2025년과 2026년 회계연도에 대해서 진행 중인 Shaheen 프로젝트와 주주가치 보호 등을 고려해서 배당 성향을 연간 당기순이익의 20% 이상으로 유지할 계획입니다. This is CFO, JW Bang. To answer your question on our dividends, we have our dividend policy whereby we want to maximize the shareholder value in the longer term. When we do so, we look into a number of factors on a combined basis. They are our business performance, the company's financial structure, and securing the available resources for the company's sustainable growth and the shareholder return. In February 2025, we disclosed the company's dividend guideline of keeping the company's dividend payout ratio for FY 2025 and 2026 at 20% or above of the annual net income. This is to protect the shareholder value, even though we are investing in the mega Shaheen Project. 먼저 25년도 회계연도의 연말 배당은 배당 가이드라인을 준수하여 이사회에서 조만간 결정할 예정이며, 구체적인 배당 금액 및 배당 기준일은 이사회에서 결정되는 즉시 공시를 통해서 알려드리겠습니다. As for the 2025 year-end dividends, we will fully comply with the dividend guidelines, and the decisions will be made by the board of directors. When any decisions on the dividend record date and the dividend amount is decided by the board of directors, we will immediately disclose them to you. 2026년도 이후에 이익이 증가하는 경우에는 비례해서 배당금액이 증가할 것으로 예상이 되고, 그다음에 배당성향 또한 이익 규모가 증가하면 일부 상승할 여지도 있습니다. 27년 이후의 배당 가이드라인에 대해서는 향후 시장 상황과 회사의 재무계획 등을 종합적으로 고려해서 추후 이사회 논의를 통해서 재공시해 드리도록 하겠습니다. As for the 2026 dividend, when the company's income level goes up this year, our dividend amount will go up correspondingly in parallel. We could also consider a slight increase in the company's dividend payout ratio if our income goes up. For the dividend guidelines for 2027 and onwards, we will set them by looking into the market conditions and the company's financial plans, and they will be up for discussions by the board of directors later. Once they are determined, we will share with you through disclosure. 이상 답변을 마치겠습니다. This answers your question. 다음으로 질문해 주실 분은 iM증권의 전유진 님입니다. 질문해 주십시오. The following question is by Jeon Yoo-jin from iM Securities. Please go ahead. 네, 안녕하세요. iM증권 전유진입니다. 기회 주셔서 감사드립니다. 저희 질문이 크게 두 가지가 있는데요. 하나는 윤활유 쪽에서 4분기가 비수기인데도 마진이 굉장히 잘 나왔었던 것 같습니다. 이거 관련해서 배경 조금만 더 설명해 주시면 감사드리겠고, 그리고 앞서서 CDU 증설에 대해서 말씀 주셨는데, 주유도 Group III 관련해서 2025년부터 2027년도까지 파악하고 계시는 증설에 대한 규모와 이거에 근거해서 저희의 수익성을 어떻게 보면 될지 가이던스도 말씀해 주시면 감사드리겠습니다. 그리고 두 번째는 석유화학 쪽에서 울산 구조조정 관련해서 혹시 조금 관여되고 있으신 분이 있으신지, 그 부분 공유해 주실 수 있는 선에서 말씀해 주시면 감사드리겠습니다. 이상입니다. I have two questions. I'm Jeon Yoo-jin from iM Investment & Securities, and thank you for giving me the opportunity to ask two questions. First is about the profitability, the high profitability of lube base oil business in Q4. What is the background behind that? What is your understanding of the global capacity expansion for Group 3 from 2025 to 2027? What is your profitability guidelines? My second question has to do with the restructuring of petrochemical industry ongoing in Ulsan. Could you give us some updates on how it is going? 먼저 윤활기유 질문에 대한 답변부터 드리도록 하겠습니다. 4분기 윤활기유 영업이익이 기대보다 좋게 나왔다고 말씀하셨는데요. 4분기에는 윤활기유 컴포짓 제품가도 살짝 하락한 반면에 유가 약세 등으로 해서 VGO, Vstock이 하락폭이 더 컸습니다. 그런 과정에서 래깅 임팩트가 발생을 해가지고 4분기 실적이 양호하게 나오게 된 것으로 설명드릴 수 있을 것 같습니다. 다음으로 2025년에서 2027년도 기간에 예정된 글로벌 증설 규모, Group III 제품 관련해서 글로벌 증설 규모 말씀드리겠습니다. 2025년에 있었던 증설은 사실 Group II였고요. 2026년에 예상되는 그룹 증설 규모는 인도와 사우디 지역을 중심으로 해서 66만 톤입니다. 2027년 이후의 증설 규모는 독일, 인도, 한국, 중국 등에서 총 150만 톤이 예상되고 있는데요. 아직 시점에 대해서 불확실성이 있고요. 2026년에서 2027년에 예상되는 Group III의 총 예상 증설 규모는 2025년도 글로벌 윤활기유 공급 대비해서 약 6% 수준입니다. Okay. To answer your first question, how the Q4 lube base oil performance was better than what the market expected. The composite product prices slightly dipped. The oil price and the VLSFO VGO price fell a little more, and there was a lagging impact, the time lagging, which caused the impact. Overall, because of that, the overall Q4 market was quite favorable. As for the 2025 to 2027 capacity guidance, which is mostly around Group III. For this year, we are expecting about 660 KTA, and mostly it will be in from India and Saudi Arabia. For 2027 and onwards, we will see about a total of 1.5 million tons of capacity additions in Germany, India, Korea and China. The timing remains a little uncertain, if you combine the 2026 and 2027 total capacity additions, it will be about 6% of the actual supply in 2025. 네, 이렇듯 신규 증설이 순차적으로 진행되면서 공급 압력이 일부 예상되지만, 인도 등 일부 지역 증설은 계획 대비 지연되는 경향이 있어서 시장에는 시차를 두고 영향을 미칠 것으로 보입니다. [Foreign language] For the new capacity additions could pose a pressure on the supply side. Some of the capacity expansions tend to be delayed in some regions like India, therefore, there will be a time lag until it impacts the market overall. As for Group III, the demand growth will outpace the supply growth. The demand growth will be 2.7% and supply 2.4%, therefore, the supply volume will keep abreast of the rising demand and slowly be digested in the market. [Foreign language] Other than the existing Group III players, there are new players who were only in Group I, but will now newly move into the Group III market. For these players, it's going to take quite a long time for them to develop the formulation for premium lube base oil and secure the reliability. Therefore, part of the newly expanded volume will only enter into the market from 2027 and 2028 onwards. [Foreign language] This answers your question. 다음 석유화학 구조조정 관련해서 답변드리겠습니다. 아시는 바와 같이 정부에서는 국내 석유화학 산업의 경쟁력 강화를 목표로 산업 구조조정을 추진하고 있으며, 우리 회사 또한 정부의 석유화학 산업 경쟁력 강화 정책에 적극 공감하고 협력하고 있습니다. To answer your second question on the petrochemical industrial restructuring. As you know very well, the government is trying to make Korea's petrochemical industry more competitive. That is their goal, we are fully aligned with the government's policy to make the petrochemical industry more competitive. We are in full collaboration with the government. 우리 회사는 국내 석유화학 산업의 구조적 경쟁력 제고에 기여하고자 첨단 고효율 설비에 대한 투자를 진행하고 있으며, 동시에 정부의 석유화학 산업 단지 재편 자율 협약에도 참여하여 울산 산업 단지 내 석유화학 회사들과 공동 컨설팅을 실시해 산업 재편 계획을 정부에 제출하는 등 적극적으로 협력하고 있습니다. To be more specific, we are investing in the high-tech, high-efficiency facilities in order to contribute to higher competitiveness of Korea's petrochemical industry. We took part in the voluntary agreement, the government's voluntary agreement on restructuring the petrochemical industry, also took part in the joint consulting with the petrochemical players in Ulsan Industrial Complex and submitted the proposed business restructuring plan to the government this fall, which all show that we are in full collaboration with the government's restructuring policy. 우리 회사의 샤힌 프로젝트는 탁월한 원가 경쟁력과 생산 효율성을 바탕으로 세계적인 경쟁력을 확보하고 있으며, 경쟁력 있는 제품을 고객사에 안정적으로 공급함으로써 울산 지역 석유화학 업계의 경쟁력 강화에 크게 기여할 것입니다. The company's Shaheen Project will significantly contribute to the competitiveness of petrochemical industry and the players in Ulsan. This is because we are going to enjoy remarkable cost competitiveness and production efficiency based on which we will have global competitive edge from our facilities and allow us to reliably supply to our customers competitive products. 이와 같이 지역 경제 발전뿐만 아니라 수입 대체, 무역 수지 개선 등 국가 경제에도 실질적으로 기여할 계획입니다. We are not only going to contribute to further advancement of the local Ulsan economy, by having our customers substitute their import demand, we will also significantly contribute to the national economy of Korea as well as the trade balance. 따라서 회사는 정부와 투자자 여러분들의 기대에 부응하고자 샤힌 프로젝트를 안전하게 완공하고 안정적으로 가동하기 위해서 전사적인 역량과 자원을 집결할 계획입니다. As such, we plan to avail all our company-wide resources and competency to ensure that Shaheen Project is safely completed and reliably operated, and thereby meeting the expectations of the government and all the investors. 이상 답변을 마치겠습니다. This answers your question. 어느덧 약속한 시간이 지난 것 같습니다. S-Oil에 대한 관심으로 오늘 실적 발표에 참여해 주신 투자자와 애널리스트 여러분들께 다시 한번 감사드립니다. 회사는 투명하고 공정한 소통을 위해 최선의 노력을 기울이겠습니다. 추가로 문의하실 점은 당사 IR팀으로 연락 주시기 바랍니다. 이것으로 오늘 실적 발표를 마치도록 하겠습니다. 감사합니다. Once again, I would like to thank all the investors and analysts for showing your keen attention to S-Oil. As always, we are committed to communicating with the market in all transparency and fairness. If you have any further questions about our Q4 performance, please feel free to contact our IR team. Once again, thank you very much for participating in the company's earning release for Q4 last year. Thank you very much. 바쁘신 중에도 참석해 주신 분들께 감사드리며, S-Oil의 2025년 4분기 실적 발표는 이것으로 마치겠습니다. 고맙습니다. This concludes the fiscal year 2025 fourth quarter earning results by S-Oil. Thank you for your participation.