Slide 1: OMV Results January – June and Q2 2014
OMV Results January – June and Q2 2014 August 12, 2014 OMV Aktiengesellschaft
Slide 2: Strategic highlights and results January – June 2014
Strategic highlights and results January – June 2014 Gerhard Roiss, Chairman of the Executive Board and CEO OMV Aktiengesellschaft
Slide 3: Market environment 6m/14
Market environment 6m/14 Brent oil price in USD/bbl 111 108 06/2014 01/2014 Oil price: Slight increase of Brent oil price to 6m/14 average of USD 109/bbl vs. 6m/13 (USD 107.5/bbl) Operating environment: Political instability in North Africa (Libya) and Middle East (Yemen) Gas prices: Significant dro
Slide 4: Highlights
Highlights Black Sea: Second Domino well spudded North Sea Region: Gudrun production start-up in Norway Acquisition of licenses in West of Shetland to strengthen UK portfolio Wisting area potential of 200-500 mn boe confirmed Tunisia: Nawara Final Investment Decision (FID) taken Bayern
Slide 5: Financial performance in 6m/14
Financial performance in 6m/14 Clean CCS EBIT (24)% in EUR mn Exploration and Production 1,583 Production loss due to political unrest in Libya. Higher Brent oil price could not compensate weaker USD. Production at 304 kboe/d. 1,037 Gas and Power 1,251 Lower spark spreads in Romania. Improved gas su
Slide 6: Stability in the OMV portfolio
Stability in the OMV portfolio Current situation in politically less stable regions makes planning increasingly difficult Focus on North Sea region and Black Sea developments further improves balance of portfolio OECD/EU long-term production share >80% Note: OMV portfolio also includes New Zea
Slide 7: Grow Upstream to ~400 kboe/d: Key projects in pipeline to reach target in 2016
Grow Upstream to ~400 kboe/d: Key projects in pipeline to reach target in 2016 OMV Production in kboe/d ~400 ~310 1 288 2013 Guidance 2014 Stable core Key growth Yemen, Libya Target 2016 countries projects not impacted by political unrest 1 Assuming no further production from Libya in 2014 7 | OMV G
Slide 8: Long-term strategic commitment beyond 2016 anchored in new Strategic Incentive Plan
Long-term strategic commitment beyond 2016 anchored in new Strategic Incentive Plan Strategic Incentive Plan (SIP) What it is and what it does How it works ► Long-term compensation vehicle 2014 2018 Grant OMV Grant 1 Personal investment shares period Complementary Grant 1 ► Promotes long-term focus
Slide 9: Optimized Downstream
Optimized Downstream R&M: Executed divestments: Closing of Bayernoil transaction 45% stake in Marmara terminal (Turkey) Finalized Petrobrazi refinery modernization Strengthened petrochemical business by capacity expansion of butadiene production G&P: Extended interim agreement with Gazpr
Slide 10: Results Q2/14
Results Q2/14 David C. Davies, Deputy Chairman of the Executive Board and CFO OMV Aktiengesellschaft
Slide 11: Q2/14 Highlights
Q2/14 Highlights Clean CCS EBIT in EUR mn Stable production at 297 kboe/d; lower oil share 734 weighs on profitability Higher depreciation and production costs mainly due to changed country mix (Norway/Libya) Increased exploration activities led to higher 597 369 exploration expenses G&P: Be
Slide 12: Economic environment
Economic environment Oil price and EUR/USD Gas prices in EUR/MWh OMV indicator refining margin in USD/bbl 1.37 29 140 1.4 30 4.0 135 1.31 26 3.5 130 1.3 25 28 125 20 3.0 2.5 120 1.2 20 2.5 115 110 20 1.9 110 1.1 15 13 2.0 102 105 1.5 100 1.0 10 95 1.0 90 0.9 5 0.5 85 80 0.8 0 0.0 Q2/13 Q3/13 Q4/13 Q
Slide 13: Results in Q2/14
Results in Q2/14 Clean CCS net income attributable in EUR mn Q2/14 Q2/13 to stockholders in EUR mn 1 EBIT 232 668 (65)% Financial result (14) (109) (87)% Profit from ordinary activities 219 559 (61)% Taxes (44) (216) (80)% 321 Effective tax rate 20% 39% (48)% Net income 175 343 (49)% Minorities an
Slide 14: Special items and CCS effect
Special items and CCS effect Q2/14 in EUR mn Q2/14 Q2/13 in EUR mn Clean CCS EBIT 369 734 369 (8) 16 CCS gains/(losses) 16 (67) (132) Clean EBIT 386 667 232 Personnel related costs (8) (1) (27) 13 Unscheduled depreciation (132) 0 Asset disposals (27) (3) Other 13 5 Total special items (153) 1 EBIT 2
Slide 15: Cash flow
Cash flow 6m/14 in EUR mn 6m/14 6m/13 in EUR mn Net income 613 1,294 (53)% (164) (108) Depreciation and 1,247 1,019 22% amortization 1,247 Other (164) (538) (69)% Sources of funds 1,695 1,775 (5)% 613 (1,787) Change in net working (108) 836 n.m. capital Cash flow from 1,587 2,611 (39)% operating a
Slide 16: CAPEX and EBITD
CAPEX and EBITD 6m/14 in EUR mn Key investments in Q2/14 2,153 Romania drilling, workovers and redevelopments 1,805 Field developments in Norway (Gullfaks, Gudrun, Edvard Grieg and Aasta Hansteen) 1,716 Maari Growth project in New Zealand 1,337 Schiehallion redevelopment in the UK Butadien
Slide 17: Exploration and Production Clean EBIT
Exploration and Production Clean EBIT in EUR mn Q2/14 vs. Q1/14 Q2/14 vs. Q2/13 603 597 6 22 35 (61) (146) (129) (83) (16) 349 (99) 349 (31) Q1/14 Realization Volume Exploration DD&A Other Q2/14 Q2/13 Realization Volume Exploration DD&A Other Q2/14 expenses expenses Lower oil sales volumes in Liby
Slide 18: Exploration and Production Key Performance Indicators
Exploration and Production Key Performance Indicators Hydrocarbon production (in kboe/d) Q2/14 vs. Q1/14 297 311 297 275 277 Production decreased by 5% 159 162 145 Libya volume levels impacted by 142 138 security issues Kazakhstan lower due to pipeline 138 133 139 149 152 issues Norway produ
Slide 19: Exploration and Production OMV Petrom group
Exploration and Production OMV Petrom group Hydrocarbon production (in kboe/d) Q2/14 vs. Q1/14 184 182 181 182 180 Clean EBIT at EUR 300 mn, lower by 1%, 88 mainly due to higher production costs and 88 87 87 84 higher exploration expenses, partly offset by higher realized prices 96 94 94 95 95 R
Slide 20: Gas and Power Clean EBIT
Gas and Power Clean EBIT in EUR mn Q2/14 vs. Q2/13 (15) (17) 5 65 10 (30) Q2/13 Supply, Gas logistics Power Other Q2/14 marketing and trading Better gas supply and portfolio optimization supported the supply, marketing and trading business Lower storage tariffs in Austria, higher costs in the ga
Slide 21: Gas and Power Key Performance Indicators
Gas and Power Key Performance Indicators Gas sales and trading volumes in TWh Q2/14 vs. Q2/13 132 118 Gas sales volumes down by 1% mainly 85 86 89 due to low gas demand from power plants counterbalanced by higher industry/commercial demand Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Gas trading volumes up
Slide 22: Refining and Marketing Clean CCS EBIT
Refining and Marketing Clean CCS EBIT in EUR mn Q2/14 vs. Q2/13 (55) (7) 161 (37) 62 Q2/13 Fuels Petrochemicals Marketing Q2/14 Considerably lower OMV indicator refining margin Higher propylene margins compensated by lower ethylene margins Lower marketing result mainly due to challenges at Pet
Slide 23: Refining and Marketing Key Performance Indicators
Refining and Marketing Key Performance Indicators Refining utilization rate in % Q2/14 vs. Q2/13 95 92 94 90 96 90 88 92 90 Overall refining utilization rate at 59 84%, down by 11% Marketing sales volumes decreased slightly Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Further filling station network West Eas
Slide 24: Key financial indicators
Key financial indicators Gearing ratio in % 30 33 29 15 12 Key financial principles Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Long-term gearing ratio target of ≤30% Payout ratio and DPS 1.20 1.25 Maintain a strong investment grade rating 1.00 1.10 Sustainable dividend policy: Long-term 32 32 29 35 payout
Slide 25: energize OMV update
energize OMV update David C. Davies, Deputy Chairman of the Executive Board and CFO OMV Aktiengesellschaft
Slide 26: energize OMV: +2% points ROACE increase in 2014 on track
energize OMV: +2% points ROACE increase in 2014 on track ROACE impact Date of Progress since status June 30, 2014 finalization program start Stabilize production in Austria and 2014 Romania Accelerate production growth in Tunisia Upstream 2014 and Pakistan Ongoing development and 2014 operational ex
Slide 27: Expected ROACE impact in 2014
Expected ROACE impact in 2014 Impact of energize OMV on ROACE in 2014 (in % points) Major achievements : 2% target 14,000 boe/d produced by energize initiatives mainly from Romania and Austria in 2014 ~0.3% to be finalized Cost efficiency program benefits in by end 2014 OMV Petrom E&P sustainabl
Slide 28: energize OMV: +2% points ROACE increase in 2014 on track
energize OMV: +2% points ROACE increase in 2014 on track 2012 2013 2014 • First commingling successes • Field redevelopment projects in • Commingling production in (~600 boe/d achieved) Pakistan brought ~4,000 boe/d Austria and Romania brought • Facilities debottlenecked • Implementation of producti
Slide 29: Exploration and Production Update
Exploration and Production Update Jaap Huijskes, Executive Board member responsible for E&P OMV Aktiengesellschaft
Slide 30: E&P project update
E&P project update Exploration only Exploration and production Continuous strong project pipeline Zidane Wisting (>1bn boe) Rosebank Gudrun Gudrun (Norway): Production start-up in April – producing at ~7 kboe/d 1 (net to OMV) Nawara Nawara (Tunisia): Final Investment Decision taken Wisting (No
Slide 31: More than 1 bn barrels in the project pipeline
More than 1 bn barrels in the project pipeline New ventures Exploration Appraisal Development Execution Middle East Black Sea Domino (Black Sea) FRDs (Romania) FRDs (Romania) Africa Norway FRDs (Austria, Romania) FRDs (Austria) FRDs (Austria) UK Bina Bawi (KRI 1) Rosebank (UK) Habban (Yemen) Faroe I
Slide 32: Key project achievements
Key project achievements Nawara, Tunisia, OMV (Op, 50%), ETAP (50%) ► Final Investment Decision taken ► Gas field development including construction of gas pipeline and treatment plant ► Line pipe manufacturing completed, ready for delivery to site ► EPCC 1 contractors being mobilized ► Production s
Slide 33: Major projects under development
Major projects under development New ventures Exploration Appraisal Development Execution Production Peak Project Working Project Country Type 2P reserves Operated start production investments interest primary year mn boe kboe/d EUR mn % FRD Romania Oil/Gas 2013-2015 ~100 ~17 ~500-550 1 100.0 2 OP F
Slide 34: Major projects under appraisal
Major projects under appraisal New ventures Exploration Appraisal Development Execution Production Cumulative Working Project Country Type Operated start production interest primary year mn boe % FRD Romania Oil/Gas 2014-2017 ~200-250 100.0 1 OP FRD Austria Oil/Gas 2015 ~5 100.0 OP Cambo Hub 2 Oil/G
Slide 35: Exploration update and high impact wells
Exploration update and high impact wells 1 Exploration only New Ventures Exploration and production Montenegro bidding round: Government accepted consortium with Marathon Atlantis Seismic North Sea Hanssen/ Apollo 2 Region Hagar Wisting Namibia: 5,000 km 3D seismic acquisition finished in June S
Slide 36: Production
Production Production impacts in 6m/14 ► Libya shut-ins ► Kazakhstan: technical difficulties 311 304 ~310 1 ► Yemen: frequent interruptions due to security 288 instability ► Norway: slower ramp up of production in Gudrun; planned shutdown of Gullfaks platform Production expectation for H2/14 ► Gudru
Slide 37: Our path to 400 kboe/d, on track
Our path to 400 kboe/d, on track Production kboe/d 2010 318 2011 288 Impacted by 2012 303 political Production 2013 288 unrest 1 Project Country Type 2 FID start Norway FRDs Romania Oil/Gas 2013-2015 Tunisia FRDs Austria Oil/Gas 2013-2015 Yemen 3 Gudrun Oil started Libya 3 Austria/ Maari Growt
Slide 38: Refining and Marketing update
Refining and Marketing update Manfred Leitner, Executive Board member responsible for R&M OMV Aktiengesellschaft
Slide 39: OMV downstream market grows despite European trend
OMV downstream market grows despite European trend EU-28 market 1 OMV market 1, 2 in mn t 2013-23, mn t 605 107 103 546 +3% -10% Turkey Turkey 2013 2023 2013 2023 1 Oil market products: LPG, naphtha, gasoline, jet/kero, gasoil, fuel oil, other products 2 Austria, Germany, Czech Republic, Slovakia, H
Slide 40: European refineries will face competitive pressure from other regions; more closures to follow
European refineries will face competitive pressure from other regions; more closures to follow Pressure on Europe’s oil product market, Further 10% closures in mid-term impacting especially coastal refineries required for refinery margins to increase 1 Europe, in mn t Refinery closures 2011-2013 Ref
Slide 41: Modernization of Petrobrazi leads to significant yield improvements
Modernization of upstream integrated refinery Petrobrazi leads to significant yield improvements 2010 2011 2012 2013 2014 2015 Concept, Execution phase Crude distillation Coker upgrade & Vacuum gasoil First full year of feasibility, FEED revamp desulfurization conversion benefits Middle di
Slide 42: Divestments of up to EUR 1 bn on track
Divestments of up to EUR 1 bn on track EUR 1.0 bn Divestment program 1 Additional working EUR 0.6 bn capital sales November February March K-PET Marketing business Croatia 45% stake in Marmara terminal (Turkey) 2011 2012 2013 2014 45% stake in Bayernoil Retail network Petrom LPG Septembe
Slide 43: Borealis contributes strongly to R&M results
Borealis contributes strongly to R&M results Borouge 3 is in the start-up phase; full Solid contribution to OMV’s bottom line capacity on stream by year end 2014 from Borealis (OMV share 36%) kt p.a. EUR mn ~2,400 ~4,400 1,000 186 172 1,400 152 ~2,000 109 88 1,400 600 52 Borouge 1-2 Borouge 3 Total
Slide 44: Strong business integration and further increased asset utilization
Strong business integration and further increased asset utilization Domestic equity crude % of refining capacity Competition 2013 1 11% OMV 2013 21% OMV 2015 >25% Refinery E&P Refining utilization rate 2 Retail sales vol. % of refining capacity Competition 2013 1 74% 22% OMV 2013 92% Competition 201
Slide 45: R&M's cash generation improved significantly and supports OMV's integrated business model
R&M´s cash generation improved significantly and supports OMV’s integrated business model Cash generation EUR bn EBITD Investment NWC 2.0 1.5 1.0 0.5 0.0 -0.5 2010 2011 2012 2013 6m/14 Note: Cash impact of Bayernoil transaction not fully reflected in 6m/14. 45 | OMV Group, Results January - June and
Slide 46: Outlook
Outlook Gerhard Roiss, Chairman of the Executive Board and CEO OMV Aktiengesellschaft
Slide 47: Outlook 2014
Outlook 2014 Oil price above USD 100/bbl G&P markets remain highly challenging Refining margins remain under pressure Marketing volumes remain under pressure Production ~310 kboe/d 1 CAPEX EUR ~3.9 bn (>80% E&P) E&A 2 expenditure EUR ~700 mn 1 Assuming no further production from Libya in 2014 2 Expl
Slide 48: Strategy “Profitable Growth”: steps in H2/14
Strategy “Profitable Growth”: steps in H2/14 Deliver key growth projects; >80% of CAPEX in E&P in 2014 Gudrun production ramp up (Norway) Maari Growth production start (New Zealand) Growing Continued emphasis on exploration Upstream Additional high impact exploration wells Review G&P ass
Slide 49: Disclaimer
Disclaimer This document does not constitute a recommendation, an offer or invitation, or solicitation of an offer, to subscribe for or purchase any securities and neither this document nor anything contained herein shall form the basis of any contract, investment decisions or commitment whatsoever.
Slide 50: OMV Aktiengesellschaft
OV OMV OMV Aktiengesellschaft ouv Moving more. Moving the future. O M V