Neste Oyj

Neste reported Q2 comparable EBITDA of EUR 1.2 billion, described by management as the company’s highest ever. Renewable Products sold over 1 million tons and delivered a record sales margin of $1,200 per ton; Oil Products posted a refining margin of $25.8 per barrel; Marketing & Services achieved EUR 23 million. On cash flow, the company generated EUR 164 million before financing activities, and management said net debt to capital fell below 30% after the successful tender of EUR 500 million of notes. Guidance-wise, Neste said full-year 2026 cash out CapEx, excluding M&A, is estimated at approximately EUR 1.2 billion. It also said Renewable Products sales volume in 2026 are expected to be approximately at the same level as in 2025, and Oil Products sales volumes in 2026 are expected to be lower than in 2025 due to the planned maintenance turnaround in Porvoo.

Heikki Malinen struck a strongly upbeat tone, calling Q2 Neste’s best financial quarter ever and saying several external and strategic factors are now aligning in the company’s favor. He emphasized favorable policy momentum from RED III in Europe and the U.S. RVO decision, plus a supportive demand outlook for renewable diesel and SAF. At the same time, he said the near-term focus remains on safety, operational performance, deleveraging, and getting returns from the major investments in Rotterdam and Singapore.

Eeva Sipila detailed that comparable EBITDA was EUR 1.2 billion, with almost 3/4 of it from Renewable Products, and said Renewable Products’ margins were above $1,000 per ton on average despite volatility. She noted the performance improvement program reached an annual run-rate impact of EUR 594 million at end-June, with EUR 145 million realized in-quarter, and that the company narrowed full-year 2026 CapEx guidance to about EUR 1.2 billion. She also said cash flow before financing activities was EUR 164 million, net working capital was a major drag because of higher market prices and inventory build, and the company reduced gross debt by tendering EUR 500 million of notes.

Analysts focused heavily on second-half Renewable Products margins, turnaround timing, utilization, and whether strong market conditions should be monetized more aggressively through spot sales or contracts. Management was cautious on near-term margin forecasting, saying feedstock costs are likely to rise and July is not a clean read because gasoil hedges and Middle East-driven volatility distort the picture. They also said term sales are roughly 60% of volume through the year, 2027 pricing will be negotiated customer by customer later in the year, and utilization issues are tied to the need to upgrade assets to process more complex feedstocks rather than a single breakdown. On capital allocation, management said the current priority is deleveraging and extracting returns from existing investments, with buybacks not commented on and dividend decisions left to the Board later in the year.