OMV: Solid results in improving environment
19. August 2010. | 16:28
In Q2/10, results were driven by a favorable crude price environment as well as an increase in the OMV indicator refining margin. The Brent price rose steadily, exceeding lastyear’s Q2 average by 32% and the OMV indicator refining margin increased by 107% compared to Q2/09.
The Group’s reported EBIT of EUR 647 mn was therefore well above the level of Q2/09 and Petrom’s contribution to reported EBIT rose to EUR 170 mn from EUR 50 mn in Q2/09.
The net financial result was EUR 5 mn better than the Q2/09 level, as a lower at-equity contribution of Petrol Ofisi and higher net interest charges were more than compensated by a better performance of Borealis and significant FX gains.
Net income after minorities of EUR 338 mn was up compared to EUR 144 mn in Q2/09. Clean CCS EBIT increased from EUR 151 mn to EUR 623 mn.The clean CCS EBIT is stated after eliminating net special charges of EUR 59 mn and positive inventory effects of EUR 83 mn. Petrom’s clean CCS EBIT was EUR 159 mn vs. EUR 16 mn in the same period last year.Clean CCS net income after minorities was EUR 314 mn and clean CCS EPS was EUR 1.05.
In Exploration and Production (E&P), clean EBIT more than doubled compared to Q2/09 and reached EUR 560 mn, mainly due to the favorable oil price environment, a stronger USD and a significantly lower negative hedging result. At 318,000 boe/d the Group’s oil and gas production was above Q2/09.
In Refining and Marketing (R&M), clean CCS EBIT came in considerably above the level of Q2/09 at EUR 120 mn. The refining business improved mainly reflecting the increase in the indicator refining margin led by higher middle distillate spreads.
Marketing was burdened by lower margins as well as lower volumes in both retail and commercial business. The petrochemicals result profited from an improved margin environment.
In Gas and Power (G&P), clean EBIT of EUR 19 mn was significantly below Q2/09, mainly reflecting a lower contribution of the supply, marketing and trading business that was characterized by significantly higher volumes but extreme pressure on margins. Additionally, the market situation in Turkey resulted in negative contributions. The logistics business benefited from higher volumes in transportation and storage.
January – June 2010 (6m/10)
In 6m/10, the average Brent price in USD was 50% higher than in 6m/09. Overall, the Group generated a strong financial performance, with EBIT and net income well above last year’s levels. The Group’s EBIT of EUR 1,357 mn was 170% above the level of 6m/09. The EBIT contribution of Petrom amounted to EUR 401 mn, a strong increase from EUR 127 mn in 6m/09.
The net financial result improved, reflecting a better contribution from associates and significant FX gains. Net
income after minorities of EUR 684 mn was above last year’s level of EUR 185 mn. Clean CCS EBIT was 159% higher, at EUR 1,271 mn after excluding net special charges mainly relating to an impairment in E&P. Petrom’s clean CCS EBIT contribution stood at EUR 381 mn, up from EUR 109 mn.
Clean CCS net income after minorities was EUR 611 mn and clean CCS EPS was EUR 2.04, 178% above 6m/09.
In E&P, clean EBIT more than doubled compared to 6m/09, mainly reflecting higher price levels as well as positive FX effects. The Group’s oil and gas production stood at 318,000 boe/d, 2% above last year’s level.
In R&M, clean CCS EBIT increased significantly to EUR 147 mn, mainly due to an improved refining and
petrochemical margin environment and positive effects from restructuring in Petrom, which more than compensated a weaker marketing result impacted by reduced market demand.
In G&P, clean EBIT was down by 22%, mainly driven by the supply, marketing and trading business, which suffered from extreme pressure on margins and was negatively affected by gas volumes sourced for the power plant in Turkey, that are currently sold under extremely difficult market conditions.
Significant events in Q2/10
- On April 24, OMV and Gazprom signed a cooperation agreement to construct the Austrian section of the South
- Stream gas pipeline between the Austrian-Hungarian border and the Baumgarten natural gas distribution node. South Stream together with Nabucco will further strengthen Baumgarten’s position as a natural gas turntable and increase the security of Europe’s supply.
- On April 26, OMV announced the refinancing of a EUR 1.5 bn syndicated revolving credit facility. This marks the latest step in a process of enhancing the funding profile of the Group.
- On May 4, OMV announced additional gas reserves in the Latif Block in Pakistan. This was the third drilling success in this area after 2007 and 2008 and substantially increases Latif’s reserves and expected production.
- On May 20-21, OMV hosted its Capital Markets Day in Vienna to update investors and analysts on its operational performance, strategy and targets.
- On May 26, OMV’s Ordinary Annual General Meeting approved a dividend of EUR 1.00 per share for 2009. Due to the resignation of Rainer Wieltsch and Mohamed Al Khaja from the Supervisory Board, Khadem Al Qubaisi and Wolfgang C.Berndt were elected as new members.
- On June 17, OMV announced that Wiener Börse AG (Vienna Stock Exchange) acquired a 20% stake in the CentralEuropean Gas Hub AG. Following the start of the joint CEGH Gas Exchange of Wiener Börse at the end of 2009, this continues the successful cooperation between OMV and the Vienna Stock Exchange.