22 slides from Galp Energia, Sgps S.a. Class B's earnings presentation, Oct 25, 2021
Slide 1: 3rd Quarter 2021 Results
3RD QUARTER 2021 RESULTS 25 October, 2021
Slide 2: Disclaimer
Disclaimer This document may include forward-looking statements, including, without limitation, regarding future results, namely cash flows, dividends, and shareholder returns; liquidity; capital and operating expenditures; performance levels, operational or environmental goals, targets or commitmen
Slide 3: Recent Developments
01 Recent Developments Andy Brown, CEO
Slide 4: 3Q21 Highlights
3Q21 Highlights Results reflecting a gradual operating recovery +€143 m YoY -€64 m YoY € 468 m €- 113 m Adjusted Operating Cash Flow1 Free Cash Flow +€206 m YoY -0.2x YoY € 607 m 1.1x RCA Ebitda Net Debt to RCA Ebitda Cash generation reflecting Operational improvement Advancing with Maintaining ESG
Slide 5: Outlook: Improved operational performance
Improved operational performance capturing supportive oil and refining environment despite challenges in Energy Management Upstream Industrial & Energy Management ▪ Increased oil production, although gas exports ▪ Refining margin recovery supported by improved restricted middle distillates cracks 3Q
Slide 6: Outlook: Iberia showing signs of recovery
Iberia showing signs of recovery and renewables benefitting from solar merchant exposure Commercial Renewables & New Businesses ▪ Oil products volumes benefiting from Iberian ▪ Current generation exposed to merchant conditions, economic recovery and driving season capturing higher solar prices 3Q21
Slide 7: Expanding renewables footprint in & outside Iberia
Expanding renewables footprint in & outside Iberia in line with strategy guidelines New portfolio additions1 594 MW solar projects acquired in Brazil 220 MW solar projects acquired in Spain Current capacity2 High quality portfolio on track towards 2025 ambition c.4.7 GW Operating & under development
Slide 8: Implementing our energy transition strategy
Implementing our energy transition strategy increasing weight of low carbon and decarbonising our operations Commercial transformation New Energies development Financing structuring Testing new convenience concept Expanding EV network Preparing Green H2 Securing low carbon financing Renewed products
Slide 9: FY2021 updated guidance
FY2021 updated guidance considering macro adjustment and operational performance 2021 distributions guidelines Q3 net debt to Ebitda at 1.1x, anticipating >€2.3 bn deleverage by YE >€1.8 bn Brent @$70/bbl 9M21 reflecting c.€0.4 bn temporary Galp ref. margin @$3/boe derivatives impacting CFFO and net
Slide 10: Executing our distinctive investment proposition
Executing our distinctive investment proposition to thrive through the energy transition Growth from Growth from Competitive established businesses + Renewables businesses + shareholder distribution ▪ Moving with Upstream developments, ▪ Bringing new production into operation ▪ Interim baseline divi
Slide 11: 3Q21 Results
02 3Q21 Results Filipe Silva, CFO
Slide 12: Solid operational results
Solid operational results Q3 benefiting from Upstream and oil downstream performance Upstream (€ m) Commercial (€ m) Upstream supported by the higher oil price environment 522 87 84 364 Commercial reflecting gradual recovery 187 21 Industrial & EM with improved refining RCA Ebitda OCF Net Capex1 RCA
Slide 13: RCA Ebitda of €607 m
RCA Ebitda of €607 m IFRS net income impacted by special items 3Q21 P&L (€ m) Ebit following the stronger operational 3Q20 2Q21 3Q21 performance RCA Ebitda 401 571 607 RCA Ebit 108 305 369 Associates up YoY reflecting the higher Associates 23 26 42 contribution from the solar renewables JV Financial
Slide 14: Operational contribution supported by macro
Operational contribution supported by macro although cash conversion impacted by temporary effects Includes €373 m 3Q21 Cash flow (€ m) increased derivatives margin accounts CFFO impacted by a working capital build mostly (temporary) driven by increased margin accounts on derivatives (21) 69 to cove
Slide 15: Appendix
3 Appendix
Slide 16: Upstream results
Upstream results benefiting from stronger oil price environment 3Q20 2Q21 3Q21 Working interest production kboepd 134 128 128 Oil production up QoQ, although total working Oil production kbpd 120 115 118 interest flat due to lower gas exports (planned maintenance) Net entitlement production kboepd 1
Slide 17: Commercial results
Commercial results gradual recovery in Iberian demand 3Q20 2Q21 3Q21 Commercial sales to clients Higher oil products driven by demand recovery in Oil products mton 1.5 1.5 1.8 Iberia, namely in the retail and aviation segments Natural gas TWh 5.3 4.5 4.4 Ebitda and OCF lower YoY, despite the higher
Slide 18: Industrial & Energy Management results
Industrial & Energy Management results with stronger refining performance offset by challenging gas sourcing environment 3Q20 2Q21 3Q21 Raw materials processed mboe 23.4 21.0 22.5 Galp refining margin supported by improved Galp refining margin USD/boe -0.7 2.4 4.0 international context, namely on ga
Slide 19: Renewables & New Businesses results
Renewables & New Businesses results capturing higher solar prices in Iberia 3Q20 2Q21 3Q21 Renewable power generation Gross GWh 143 475 408 Renewable generation down QoQ impacted by an Net to Galp GWh 106 355 304 upset in one transformer constraining c.200 MW Average solar generation sale price EUR/
Slide 20: Maintaining a solid financial position
Maintaining a solid financial position although temporarily impacted by derivatives effects Balance Sheet (€ m) 31 Dec., 30 Jun., 30 Sep., 2020 2021 2021 Working capital and Other assets/liabilities Net fixed assets 6,259 6,284 6,484 movements impacted by temporary effects of €638 Rights of use (IFR
Slide 21: Debt indicators
Debt indicators Debt indicators (€ m) Debt reimbursement (€ m) 31 Dec., 30 Jun., 30 Sep., 2020 2021 2021 1,000 Cash and cash equivalents 1,678 1,533 1,257 800 Undrawn credit facilities 1,262 1,133 1,133 600 Gross debt 3,743 3,244 3,285 400 Average funding cost 1.7% 1.4% 1.4% 200 Net debt 2,066 1,711
Slide 22: galp.com
galp.com