Turkiye Petrol Rafinerileri A.s. · BIST:TUPRS
Turkiye Petrol Rafinerileri A.s — Tüpraş — Q3 2020 Earnings Presentation
34 slides from Turkiye Petrol Rafinerileri A.s's earnings presentation, Nov 3, 2020
Slide 1: Q3 2020 Earnings Presentation
Q3 2020 Earnings Presentation 3 November 2020 Hizmete Özel / Confidential
Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking statements that reflect the Company management’s current views with respect to certain future events. Although it is believed that the expectations reflected in these statements are reasonable, they may be affected by variables and changes in und
Slide 3: Q3 2020 in Summary
Q3 2020 in Summary Mid distillate cracks were under pressure in Q3 due to weak demand and elevated stocks. This weakness took its toll on our operational profitability. Heavy crude differentials also narrowed to historically lows and even turned to premium following the OPEC+ agreement in May. Major
Slide 4: Q3 2020 Tüpraş Highlights
Q3 2020 Tüpraş Highlights $/bbl 10 Q3 Mid-distillate cracks started Q4 with an uptick after a historically weak Q3 2 • Jet fuel cracks reached positive territory for the first time since April. • Recovering jet fuel usage supports diesel cracks as well -6 Diesel Gasoline Jet WACM* • Gasoline remains
Slide 5: Market
Market Hizmete Özel / Confidential
Slide 6: Q3 2020 – Key Market Highlights
Q3 2020 – Key Market Highlights Flights still well below 2019 levels, creating pressure on Elevated global stock levels have been weighing on jet fuel cracks distillate cracks in Q3 Global Oil Market Change in Jet Fuel Demand and Number of Global Commercial Flights, Global Diesel Stocks 2020 vs. 201
Slide 7: Quarterly Crack Margin Comparison ($/bbl) 2016 - 2020
Quarterly Crack Margin Comparison ($/bbl) 2016 - 2020 Diesel and jet cracks weakened with elevated stock levels and fragile demand. Seasonality and higher personal transportation supported gasoline while HSFO crack margins remained strong with limited supply. 2020 2019 2016-2020 Min - Max Diesel Jet
Slide 8: Heavy Crude Price Differentials to Brent ($/bbl)
Heavy Crude Price Differentials to Brent ($/bbl) OPEC+ agreement on supply cuts in May and extension of initial cut target to the end of July led to sizeable narrowing in differentials in Q3. 2 0 -2 Arab Heavy -4 Basrah Heavy -6 Kirkuk Ural -8 Average* -10 Iran OPEC+ Cut OPEC+ OPEC+ Cut -12 Sanction
Slide 9: Operations
Operations Hizmete Özel / Confidential
Slide 10: Capacity Utilization and Quarterly Production Volume
Capacity Utilization and Quarterly Production Volume • Tüpraş produced 6.4 million tons in Q3 2020. • Capacity utilization for Q3 2020 was 89% - supported by post-lockdown recovery as well as seasonality. Quarterly Production (Million Tons) Capacity Utilization (%) 2016 2017 2018 2019 2020 Crude Oil
Slide 11: Sales in Q3 (Million Tons)
Sales in Q3 (Million Tons) Tüpraş generated 6.7 million tons of sales in Q3 2020. Y-o-y decline in domestic jet fuel sales off-set by diesel, gasoline and bitumen. Total Sales Domestic Sales of Selected Products Domestic Sales Exports Diesel Jet Fuel Gasoline Bitumen 8.9 8.7 8.1 1.3 1.1 1.2 1.0 7.8
Slide 12: Financials
Financials Hizmete Özel / Confidential
Slide 13: Tüpraş Net Margin and Med Complex Margin Comparison ($/bbl)
Tüpraş Net Margin and Med Complex Margin Comparison ($/bbl) Q3 Margins Tüpraş Net Med Margin 13.5 • Tüpraş net refining margin declined compared to Q3 2019 mainly because of weaker crack 8.9 margins, narrower differentials and lower production. 6.5 5.7 5.1 3.8 4.0 • Tüpraş Net Margin outperformed Me
Slide 14: Income Statement (Million TL)
Income Statement (Million TL) EBITDA realized as 977 mn TL in Q3 2020. Q3 Q3 9M 9M Million TL % % 2020 2019 2020 2019 Net Sales 17,035 23,309 -27% 43,254 67,970 -36% COGS -15,845 -22,152 28% -42,083 -64,150 34% Gross Profit 1,190 1,157 3% 1,171 3,820 -69% Operating Expenses -500 -451 -11% -1,477 -1,
Slide 15: Q3 Profit Before Tax Bridge (2019-2020)
Q3 Profit Before Tax Bridge (2019-2020) Inventory gain was off set by weaker crack margins and narrower differentials as well as higher fx loss leading to decline in PBT compared to Q3 2019. Million TL 03/11/2020 Hizmete Özel / Confidential www.tupras.com.tr 15 Earnings Presentation
Slide 16: Financial Highlights
Financial Highlights EBITDA (mn TL) Q4 Net Income¹ (mn TL) Q4 8,908 Q3 3,812 Q3 3,713 Q2 493 Q2 1,887 Q1 992 1,766 Q1 5,882 1,793 1,457 542 526 1,237 3,778 803 4,039 1,027 186 3,396 581 1,528 869 870 -2,870 738 331 378 79 -375 1,505 956 -155 1,542 2,210 163 867 1,495 -2,265 1,575 977 688 1,033 335 8
Slide 17: Balance Sheet Analysis
Balance Sheet Analysis Net Debt Redemption Schedule (Billion TL) bn TL bn $ In Billion TL In Billion $ 12.1 TL Hard Currency 20 17.8 6 5 15 12.0 12.2 4 7.2 11.0 10 8.4 3 5.6 6.1 6.2 2 5 2.3 2.3 2.2 1.9 1.4 1.7 1.7 1.6 1 0.2 1.4 0 0 Dec-16 Dec-17 Dec-18 Dec-19 Mar-20 Jun-20 Sep-20 1 year 1-2 years 2-
Slide 18: FX Exposure Management (30 September 2020)
FX Exposure Management (30 September 2020) Consolidated Hard Consolidated Hard Currency Assets Currency Liabilities Million $ Payables & Other Cash Liabilities 1,082 1,074 Receivables & Tüpraş continues to employ strict FX Other Assets ST Financial Loans policies to mitigate currency risks 63 458 •
Slide 19: Outlook for 2020
Outlook for 2020 Hizmete Özel / Confidential
Slide 20: 9M 2020 Results
9M 2020 Results Capacity Utilization (%) Refining Margins ($/bbl) 9M 80.9 80.9 % total capacity 2020 utilization in 9M 2020 0 20 40 60 80 100 Med FY Tüpraş FY Exp Target Operationals -0.2 9M FY Target Med Margin 18.2 mn tons of sales 9M 2020 and 17.3 mn tons of 23 production in 9M 2020 1.5 17.3 22 1
Slide 21: 2020 Refinery Maintenance Schedule
2020 Refinery Maintenance Schedule Refinery Unit Quarter Duration (weeks) Status Q1 10-12 Completed Batman Plt 100/1100 Crude Oil & Vacuum 2019 Q4-2021 Q1 8 Planned U-100 Crude Q1 9* Completed U-9200 CCR Q1 3 Completed U-4000 FCC Q4 6 Planned İzmir U-9200 CCR Q4 7 Postponed to 2021 U-9600 Isomerizat
Slide 22: 2020 Expectations
2020 Expectations(*) Med Complex Refining Margin ~-0.5 $/bbl • Weak outlook for mid-distillate cracks • Ural-Brent differential slightly wider compared to 2019 Tüpraş Net Refining Margin ~1.0 $/bbl • Weak performing mid-distillate cracks • Strong HSFO and relatively resilient gasoline cracks • ~22 m
Slide 23: www.tupras.com.tr
www.tupras.com.tr 03/11/2020 Hizmete Özel / Confidential www.tupras.com.tr 23 Earnings Presentation
Slide 24: Appendix
Appendix 03/11/2020 Hizmete Özel / Confidential www.tupras.com.tr 24 Earnings Presentation
Slide 25: Turkish Market, Jan-Aug 2019/20 (Million Tons)
Turkish Market, Jan-Aug 2019/20 (Million Tons) Diesel ¹Jet Fuel 20 3.0 -1.0% -56.2% 15 3.50 10 1.5 16.05 15.90 5 1.53 0 0.0 2019 2020 2019 2020 Gasoline ²Fuel Oil 2 1.0 1 -5.1% 0.5 -28.3% 1.63 1.55 0.26 0.18 0 0.0 2019 2020 2019 2020 ¹Transit flight consumption included ²Bunker excluded 03/11/2020 H
Slide 26: OPET
OPET Opet has 1,749 fuel stations as of September 2020. Opet Sunpet 1,749 Market Share 1,670 as of August 2020 1,615 1,560 1,504 1,444 1,356 1,393 553 1,279 1,325 463 495 20.13 % 22.89 % 434 431 427 435 410 418 White Black 394 Product Product 1,126 1,152 1,175 1,196 1,009 1,073 885 915 938 966 2011
Slide 27: Crack Margin Effect on Tüpraş in Q3 (FOB Italy Prices)
Crack Margin Effect on Tüpraş in Q3 (FOB Italy Prices) Product Price ($/ton) Tüpraş 2020 Q3 Crack Margin ($/bbl) Product 2020 Q3 2019 Q3 Production Yields 2020 Q3 2019 Q3 LPG 316 312 4.8% -14.8 -34.2 Gasoline 396 604 21.7% 5.8 12.4 Naphtha 359 459 1.3% -2.4 -10.2 Jet Fuel 322 613 10.3% -2.1 16.1 Die
Slide 28: Q3 Product Yields
Q3 Product Yields 2019 Q3 2020 Q3 LPG Other Bitumen Other 4% 1% LPG Bitumen 3% Kok 9% 2% Gasoline 15% 3% Other Gasoline 19% Kok Other white 21% Fuel Oil Light 3% white 2% Fuel Oil Black Prod. 1% Light 7% Black Prod. Distil. 0% 18% Distil. 19% 24% Naphtha 25% 1% Naphtha 1% Jet Mid. Distil. Mid. Disti
Slide 29: 9M Product Yields
9M Product Yields 2019 9M 2020 9M LPG Other BitumenOther LPG 2% 4% Bitumen 1% 3% 8% 12% Kok Gasoline Gasoline Kok 2% Other 20% Other 20% 3% Fuel Oil white Light Fuel Oil White Black Prod. 1% Light 11% Black Prod. 2% Distil. 2% 17% Distil. 21% 25% 24% Naphtha Naphtha 1% 1% Jet Mid. Distil. Mid. Disti
Slide 30: Tüpraş Balance Sheet (Million TL)
Tüpraş Balance Sheet (Million TL) 30.09.2020 31.12.2019 Diff. Diff. (%) Current Assets 25,054 27,919 -2,865 -10 Cash & C. Equivalents 10,891 10,652 239 2 Trade Receivables 4,676 4,788 -112 -2 Derivatives 1,064 304 760 250 Inventories 7,234 9,469 -2,235 -24 Pre-paid expenses 224 237 -13 -6 Other Curr
Slide 31: Tüpraş and Med Margins ($/bbl)
Tüpraş and Med Margins ($/bbl) Average Margins Tüpraş Net Margin Med Margin 10 9.3 8.1 8 6 5.3 4.6 3.7 3.7 4 2.9 1.7 1.5 2 0 -0.2 -2 2017 12M 2018 12M 2019 12M 2019 9M 2020 9M Gross Inventory Clean Gross Clean NET Net ($/bbl) Med Margin Margin Effect Margin Margin Margin 2020 Q3 6.7 2.9 3.8 -0.8 2.1
Slide 32: Capacity Utilization (%)
Capacity Utilization (%) Q3 Capacity Utilization* 12M Capacity Utilization* Crude Oil Semi Product Feedstock Total Crude Oil Semi Product Feedstock Total 115 115 109 108 8 7 105 105 4 7 4 96 98 9 89 7 9 9 105 107 107 101 101 96 91 87 80 Q3 2016 Q3 2017 Q3 2018 Q3 2019 Q3 2020 2016 2017 2018 2019 *Ca
Slide 33: Finished Product and Semi Product Imports (Thousand Tons)
Finished Product and Semi Product Imports (Thousand Tons) Product Imports Intermediate Imports Q3 2020 Q3 2019 Q3 2020 Q3 2019 333 299 292 149 150 103 98 79 66 60 60 30 - 0 0 HS Diesel ULSD Jet Fuel HVGO ASR F. Oil LSFO Naphtha MTBE 03/11/2020 Hizmete Özel / Confidential Earnings Presentation www.tu
Slide 34: www.tupras.com.tr
www.tupras.com.tr 03/11/2020 Hizmete Özel / Confidential www.tupras.com.tr 34 Earnings Presentation