Galp Energia, Sgps S.a. Class B · EURONEXT:GALP

Galp Energia, Sgps S.a. Class B — Galp Energia — Q1 2008 Earnings Presentation

24 slides from Galp Energia, Sgps S.a. Class B's earnings presentation, May 20, 2008

  1. Slide 1: First Quarter 2008 Results

    FIRST QUARTER 2008 RESULTS Lisbon, 20 May 2008

  2. Slide 2: Disclaimer

    DISCLAIMER Matters discussed in this presentation may constitute forward-looking statements. Forward-looking statements are statements other than in respect of historical facts. The words “believe,” “expect,” “anticipate,” “intends,” “estimate,” “will,” “may,” "continue," “should” and similar expres

  3. Slide 3: Market Overview

    MARKET OVERVIEW © galp energia

  4. Slide 4: Steeper curve of Brent and Euro, widening gap to 2007

    STEEPER CURVE OF BRENT AND EURO, WIDENING GAP TO 2007 Brent dated Rotterdam Cracking 10 140 Avg. 1Q08 120 96.9 Usd/bbl 8 100 6 Avg. 1Q07 80 3.5 Usd/bbl 60 4 Avg. 1Q07 40 57.8 Usd/bbl 2 Avg. 1Q08 20 2.8 Usd/bbl 0 0 J F M A M J J A S O N D J F M A M J J A S O N D Eur/Usd exchange rate Spanish pool pri

  5. Slide 5: Highlights

    HIGHLIGHTS Orn energia

  6. Slide 6: Replacement cost adjusted EBITDA of €234 million, up 3.3%

    REPLACEMENT COST ADJUSTED EBITDA OF €234 MILLION, UP 3.3% Replacement Cost IFRS Adjusted 1 1Q07 1Q08 % Ch. € Million 1Q07 1Q08 % Ch. 2,750 3,493 27.0% Turnover 2,746 3,493 27.2% 242 316 30.7% EBITDA 226 234 3.3% 179 247 37.8% EBIT 165 169 2.6% 19 12 (37.6%) Associates 19 12 (37.6%) 143 175 22.9% Net

  7. Slide 7: Replacement cost adjusted EBITDA up 3% YoY and 30% QoQ

    REPLACEMENT COST ADJUSTED EBITDA UP 3% YoY AND 30% QoQ • G&P and E&P strongly contributing to growth in replacement cost adjusted EBITDA • Replacement cost adjusted EBITDA posted double digit increase QoQ in each segment Replacement cost adjusted EBITDA (€ Million) 11 37 234 226 (40) 1 1Q07 E&P R&M

  8. Slide 8: Business Overview

    BUSINESS OVERVIEW © galp energia

  9. Slide 9: Increase in unit margin compensates lower production

    INCREASE IN UNIT MARGIN COMPENSATES LOWER PRODUCTION • Expected delays in BBLT drilling activities to be solved before the end of 2Q08 • Reduction in net entitlement production due to lower working production and to higher crude oil prices Net Entitlement Production by Field (Million bbl) Realized S

  10. Slide 10: External drivers continued to push refining margins down

    EXTERNAL DRIVERS CONTINUED TO PUSH REFINING MARGINS DOWN • Margins impacted by Eur/Usd appreciation, +14% YoY • Decreasing fuel oil and gasoline cracks, -34% YoY and -6% YoY, respectively • Increase of crude processed to 24 Million bbl, up 23% QoQ, after Porto refinery’s programmed outage in 4Q07 Ga

  11. Slide 11: Direct customers continued supporting volumes

    DIRECT CUSTOMERS CONTINUED SUPPORTING VOLUMES • Positive contribution from wholesale segment, up 7% YoY • Exports up 2% YoY fuelled by gasoline growth of 29%, mainly to USA Million tons 1Q08 % YoY % QoQ Refining throughput 3.1 (1.5%) +14.3% Total volumes of products sold 3.9 (1.6%) +2.9% Direct cust

  12. Slide 12: Natural gas volumes reached 1,471 Mm3, up 32% YoY

    NATURAL GAS VOLUMES REACHED 1,471 Mm3, UP 32% YoY • Electrical and trading segments responsible for 55% of total volumes sold, posting an increase of 71% YoY, due to low hydro levels • Volumes in Spain, in industrial sector, reached 16 Mm3 during the quarter • 16 thousand new clients acquired in 1Q0

  13. Slide 13: Financial Overview

    FINANCIAL OVERVIEW © galp energia

  14. Slide 14: Replacement cost adjusted EBITDA reached €234 million

    REPLACEMENT COST ADJUSTED EBITDA REACHED €234 MILLION • E&P benefited from increase in realized sale price, 92% YoY • R&M performance hampered by Usd devaluation and decreasing fuel oil and gasoline cracks • G&P growth supported by increasing volumes in electrical and trading segments Replacement co

  15. Slide 15: Replacement cost adjusted EPS of €0.13, up 4.6% on USD basis

    REPLACEMENT COST ADJUSTED EPS OF €0.13, UP 4.6% ON USD BASIS Replacement Cost IFRS Adjusted 1 1Q07 1Q08 % Ch. € Million 1Q07 1Q08 % Ch. 2,750 3,493 27.0% Turnover 2,746 3,493 27.2% 242 316 30.7% EBITDA 226 234 3.3% 179 247 37.8% EBIT 165 169 2.6% 19 12 (37.6%) Associates 19 12 (37.6%) 143 175 22.9%

  16. Slide 16: Cash flow generated led to net debt reduction

    CASH FLOW GENERATED LED TO NET DEBT REDUCTION 1Q07 1Q08 € Million 178 136 258 229 Operations Operations 93 80 Operations Investment Capex Capex SOURCES USES SOURCES USES 16 First Quarter 2008 Results Net debt reduction

  17. Slide 17: Stronger capital structure

    STRONGER CAPITAL STRUCTURE Balance Sheet Items (€ Million) Dec. 2007 Mar. 2008 Ch. Fixed Assets 2,584 2,629 45 Strategic Stock 566 679 113 Other assets (liabilities) (170) (235) (65) Working Capital 180 121 (60) Net Debt 734 598 (136) Equity 2,426 2,596 169 Capital Employed 3,160 3,194 33 Net Debt t

  18. Slide 18: First quarter highlights

    FIRST QUARTER HIGHLIGHTS EXPLORATION • Contributed to 23% of replacement cost adjusted EBITDA & PRODUCTION • Realization price up 92% YoY REFINING • Usd devaluation hurt margins in 1Q08 & MARKETING • Direct customers continued supporting volumes GAS • Replacement cost adjusted EBITDA up 57% YoY & PO

  19. Slide 19: Agreements with PDVSA

    AGREEMENTS WITH PDVSA

  20. Slide 20: Venezuela, a new platform for growth

    VENEZUELA, A NEW PLATFORM FOR GROWTH DELTA CARIBE • 2 projects, each to include the development of a natural gas pipeline AND MARISCAL and a liquefaction facility SUCRE • Total processing capacity of 13 bcm of LNG per year LNG PROJECTS • Participation of 15% in each project; start-up estimated for 2

  21. Slide 21: Delta Caribe and Mariscal Sucre LNG projects

    DELTA CARIBE AND MARISCAL SUCRE LNG PROJECTS Project highlights Next steps • Establishment of a coordination committee to develop: • Basic engineering and determine final investment amounts • Stake of 15% on both projects (1 train • Commercialization and 1 pipeline per project) • Total liquefaction

  22. Slide 22: Orinoco Belt reserves certification

    ORINOCO BELT RESERVES CERTIFICATION Project highlights Next steps N Phase I (Ongoing) B lo c k s 1 t o 6 A r e a : 5 ,0 9 7 K m ² 21 B O YA C Á N O R TE 3 1 w e lls d r ille d O il in p la c e : 2 7 1 B n b b l 2960 K m ² 1 1 – Information validation 767 K m ² 2 2 5 Until May N a t io n a l p a r k

  23. Slide 23: Crude oil acquisition and wind farms agreements

    CRUDE OIL ACQUISITION AND WIND FARMS AGREEMENTS Crude oil Wind farms • Annual acquisition of crude oil • Study, project and installation of 4 between 2 and 4 million barrels wind farms at Guajira, Chacopata and Nueva Esparta States • Market price is the acquisition price • Total capacity of 72 MW •

  24. Slide 24: Investor Relations

    Investor Relations Tiago Villas-Boas Tel.: +351 21 724 08 66 Fax: +351 21 724 29 65 E-mail: tiagovb@galpenergia.com Website: www.galpenergia.com

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