ORLEN Spolka Akcyjna · GPW:PKN
ORLEN Spolka Akcyjna — PKN Orlen — Q2 2018 Earnings Presentation
35 slides from ORLEN Spolka Akcyjna's earnings presentation, Jul 20, 2018
Slide 1: PKN ORLEN consolidated financial results 2Q18
PKN ORLEN consolidated financial results 2Q18 20 July 2018 #ORLEN2Q18@PKN_ORLEN
Slide 2: Agenda
Agenda Key facts and figures 2Q18 Macro environment Financial and operating results Liquidity and investments Outlook for 2018 2
Slide 3: Key facts and figures 2Q18
Key facts and figures 2Q18 EBITDA LIFO: PLN 2,1 bn Crude oil throughput: 7,5 mt / 85% utilization due to planned maintenance shutdowns Sales: 10,5 mt, i.e. increase by 2% (y/y) Record high quarterly retail result: PLN 677 m EBITDA LIFO Value creation Diversification of crude oil supplies: purchase o
Slide 4: Agenda
Agenda Key facts and figures 2Q18 Macro environment Financial and operating results Liquidity and investments Outlook for 2018 4
Slide 5: Macro environment in 2Q18 (y/y)
Macro environment in 2Q18 (y/y) Downstream margin decrease Product slate of downstream margin Model downstream margin, USD/bbl Crack margins Refining products (USD/t) 2Q17 1Q18 2Q18 ∆ y/y -1,2 USD/bbl Diesel 79 87 97 23% 13,6 13,9 Gasoline 161 133 160 -1% 12,4 11,5 11,4 HHO -99 -154 -163 -65% SN 150
Slide 6: Fuel consumption increase in Poland (y/y)
Fuel consumption increase in Poland (y/y) GDP increase1 Fuel consumption (diesel, gasoline)2 Change % (y/y) mt 2Q17 3Q17 4Q17 1Q18 2Q18 2Q17 2Q18 2Q17 2Q18 5,2 4,9 5,2 + 5% 4,0 4,5÷4,9 + 5% 4,00 4,18 1,11 1,16 Poland - 2% - 2% 2,3 9,81 9,65 2,2 1,6 1,6÷2,0 1,0 4,69 4,61 Germany 4,8 5,5 + 3% 3,3 3,7
Slide 7: Agenda
Agenda Key facts and figures 2Q18 Macro environment Financial and operating results Liquidity and investments Outlook for 2018 7
Slide 8: Financial results in 2Q18
Financial results in 2Q18 2Q17 1Q18 2Q18 PLN m 6M17 6M18 Revenues: increase by 16% (y/y) due to crude oil + 16% +9% price increase and higher sales volumes. 23 025 23 241 26 701 45 900 49 942 Revenues - 1,4 bn EBITDA LIFO: decrease by PLN (-) 0,9 bn (y/y) - 0,9 bn mainly due to negative impact of ma
Slide 9: EBITDA LIFO – segments' results in 2Q18
EBITDA LIFO Segments’ results in 2Q18 PLN m Downstream: negative impact of macro partially offset by 677 82 higher sales volumes (y/y). 2 127 -212 2Q18 results include PLN 0,4 bn one-off’s, of which: PLN 0,3 1 580 bn compensation related to Steam Cracker failure from 2015 and PLN 0,1 bn penalties fo
Slide 10: Downstream – EBITDA LIFO
Downstream – EBITDA LIFO Negative impact of macro at higher sales volumes EBITDA LIFO PLN m Sales volumes increase by 1% (y/y), of which: 3000 higher sales (y/y): diesel by 2% (however in Poland 2550 2513 diesel increased by 15%), polyolefins by 9%, fertilizers by 2363 31%, PVC by 14% and PTA by 36%
Slide 11: Downstream – operational data
Downstream – operational data Sales volumes increase despite lower crude throughput Sales volumes Utilization ratio mt % +1% 8,9 9 Refineries 2Q17 1Q18 2Q18 ∆ (y/y) 8,5 8,2 Płock 79% 103% 94% 15 pp 8,1 8,0 7,9 8 7,7 Unipetrol 96% 86% 75% -21 pp 7,6 7,3 7,2 ORLEN Lietuva 89% 98% 77% -12 pp 7 Petroche
Slide 12: Retail – EBITDA LIFO
Retail – EBITDA LIFO Sales volumes and retail margins increase EBITDA LIFO PLN m Sales volumes increase by 5% (y/y). 900 Market share increase in all markets (y/y). 677 619 610 576 Fuel margin increase on Polish and German markets at 600 491 lower margins on Czech market (y/y). 441 440 464 372 301 N
Slide 13: Retail – operational data
Retail – operational data Sales volumes increase and further non-fuel offer growth Sales volumes Number of petrol stations and market shares (by volume) mt #, % + 5% 2,5 2,4 2,3 2,3 2,3 2,2 2,2 2,1 2,1 2,0 2,0 1,9 1,5 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 Coffee corners (including conven
Slide 14: Upstream – EBITDA LIFO
Upstream – EBITDA LIFO Positive macro impact and increase of average production by 20% (y/y) EBITDA LIFO Average production PLN m th. boe/d + 20% 150 20 128 18,0 16,7 17,1 16,2 100 80 82 82 78 15,0 68 14,2 14,4 58 15 13,9 53 42 13,212,8 50 27 10 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 1Q16
Slide 15: Upstream
Upstream Poland Canada Total reserves of crude oil and gas (2P) Total reserves of crude oil and gas (2P) Ca. 11 m boe* (6% liquid hydrocarbons, 94% gas) Ca. 141 m boe* (42% liquid hydrocarbons, 58% gas) 2Q18 2Q18 Average production: 0,9 th. boe/d (100% gas) Average production: 17,1 th. boe/d (46% li
Slide 16: Agenda
Agenda Key facts and figures 2Q18 Macro environment Financial and operating results Liquidity and investments Outlook for 2018 16
Slide 17: Cash flow
Cash flow Cash flow from operations Cash flow from investments PLN bn PLN bn 0,9 2,1 1,9 -0,7 0,5 -0,4 -0,6 -1,1 EBITDA LIFO effect Working capital Others Net inflow CAPEX CAPEX liabilities Net outflow LIFO increase from 2Q18 change and from 2Q18 Operations others* Investments 2Q18 2Q18 Working capi
Slide 18: Financial strength
Financial strength Net debt and gearing Net debt /EBITDA LIFO PLN bn, % Financial gearing 15,7 3,5 12,7 3,0 2,5 2,0 5,2 1,5 3,7 4,3 1,0 0,59 1,7 2,2 0,35 0,46 0,5 0,11 0,07 1,2 0,8 0,6 0,0 2Q17 3Q17 4Q17 1Q18 2Q18 2Q16 4Q16 2Q17 4Q17 2Q18 Diversified sources of financing (gross debt) Gross debt stru
Slide 19: CAPEX
CAPEX Planned CAPEX 2018 Realized CAPEX 6M18 – split by segment PLN bn, % PLN m 4,8 89 1872 381 Downstream 1,2 16% Retail 0,4 287 Development 2,5 48% 5,8 5,1 32% Upstream 0,8 1115 4% Energy 125 Corp. functions 0,1 Petrochemicals 391 Maintenance 2,3 599 and regulatory Refining CAPEX Downstream Retail
Slide 20: Agenda
Agenda Key facts and figures 2Q18 Macro environment Financial and operating results Liquidity and investments Outlook for 2018 20
Slide 21: Market environment 2018
Market environment 2018 Macro Brent crude oil – expected increase of crude oil price vs. the average for 2017 mainly due to extension till the end of 2018 of the agreement between OPEC countries and Russia regarding limitation of crude oil production and high geopolitical risk. However, stronger inc
Slide 22: Thank you for your attention
Thank you for your attention For more information on PKN ORLEN, please contact Investor Relations Department: phone: + 48 24 256 81 80 fax: + 48 24 367 77 11 e-mail: ir@orlen.pl www.orlen.pl
Slide 23: Supporting slides
Agenda Supporting slides 23 23
Slide 24: Results – split by quarter
Results – split by quarter PLN m 2Q17 1Q18 2Q18 ∆ (y/y) 6M17 6M18 ∆ Revenues 23 025 23 241 26 701 16% 45 900 49 942 9% EBITDA LIFO 3 058 1 893 2 127 -30% 5 379 4 020 -25% LIFO effect -344 144 936 - 175 1 080 517% EBITDA 2 714 2 037 3 063 13% 5 554 5 100 -8% Depreciation -581 -626 -673 -16% -1 143 -1
Slide 25: Results – split by segment
Results – split by segment 2Q18 Corporate Downstream Retail Upstream TOTAL PLN m functions EBITDA LIFO 1 580 677 82 -212 2 127 LIFO effect 936 - - - 936 EBITDA 2 516 677 82 -212 3 063 Depreciation -451 -114 -82 -26 -673 EBIT 2 065 563 0 -238 2 390 EBIT LIFO 1 129 563 0 -238 1 454 1Q17 Corporate Down
Slide 26: EBITDA LIFO – split by segment
EBITDA LIFO – split by segment PLN m 2Q17 1Q18 2Q18 ∆ (y/y) 6M17 6M18 ∆ Downstream 2 550 1 513 1 580 -38% 4 571 3 093 -32% Retail 576 464 677 18% 948 1 141 20% Upstream 82 68 82 0% 162 150 -7% Corporate functions -150 -152 -212 -41% -302 -364 -21% EBITDA LIFO 3 058 1 893 2 127 -30% 5 379 4 020 -25%
Slide 27: Results – split by company
Results – split by company Others and 2Q18 ORLEN consolidation 2 2 PLN m PKN ORLEN S.A. Unipetrol Lietuva corrections Total Revenues 20 883 5 186 4 622 -3 990 26 701 EBITDA LIFO 1 260 393 113 361 2 127 1 LIFO effect -716 -171 -43 -6 -936 EBITDA 1 976 564 156 367 3 063 Depreciation 346 132 20 175 673
Slide 28: ORLEN Lietuva Group
ORLEN Lietuva Group USD m 2Q17 1Q18 2Q18 ∆ y/y 6M17 6M18 ∆ Revenues 954 1 232 1 281 34% 1 967 2 513 28% EBITDA LIFO 58 17 30 -48% 99 47 -53% EBITDA 54 19 42 -22% 108 61 -44% EBIT 49 13 37 -24% 99 50 -49% Net result 50 12 27 -46% 93 39 -58% Sales volumes at comparable level (y/y). Higher revenues ref
Slide 29: UNIPETROL Group
UNIPETROL Group CZK m 2Q17 1Q18 2Q18 ∆ y/y 6M17 6M18 ∆ Revenues 31 181 27 172 31 136 0% 61 031 58 308 -4% EBITDA LIFO 6 549 1 499 2 349 -64% 10 165 3 848 -62% EBITDA 6 060 1 371 3 381 -44% 10 031 4 752 -53% EBIT 5 369 610 2 591 -52% 8 716 3 201 -63% Net result 3 594 366 2 896 -19% 6 432 3 262 -49% I
Slide 30: Macro environment in 3Q18
Macro environment in 3Q18 Downstream margin decrease Product slate of downstream margin Model downstream margin, USD/bbl Crack margins Refining products (USD/t) 3Q17 2Q18 3Q18* ∆ Q/Q ∆ Y/Y -1,7 USD/bbl Diesel 96 97 90 -7% -6% 13,6 13,9 Gasoline 164 160 161 1% -2% 12,4 12,2 HSFO -100 -163 -142 13% -4
Slide 31: Macro environment in 3Q18
Macro environment in 3Q18 Refining margin with B/U differential decrease Petrochemical margin decrease Model refining margin and Brent/Ural differential, USD/bbl Model petrochemical margin, EUR/t differential margin - 1,8 USD/bbl - 26 EUR/t 1.003 8,4 8,9 911 890 902 885 1,0 7,4 853 1,5 7,1 6,2 5,6 2
Slide 32: Production data
Production data 2Q17 1Q18 2Q18 ∆ (y/y) ∆ (q/q) 6M17 6M18 ∆ Total crude oil throughput in PKN ORLEN (kt) 7 622 8 529 7 461 -2% -13% 15 516 15 990 3% Utilisation 87% 98% 85% -2 pp -13 pp 89% 92% 3 pp 1 Refinery in Poland Processed crude (kt) 3 222 4 121 3 802 18% -8% 6 906 7 923 15% Utilisation 79% 10
Slide 33: Dictionary
Dictionary Model downstream margin = revenues (90,7% Products = 22,8% Gasoline + 44,2% Diesel + 15,3% HHO + 1,0% SN 150 + 2,9% Ethylene + 2,1% Propylene + 1,2% Benzene + 1,2% PX) – costs (input 100% = 6,5% Brent crude oil + 91,1% URAL crude oil + 2,4% natural gas) Model refining margin = revenues (9
Slide 34: Disclaimer
Disclaimer This presentation (“Presentation”) has been prepared by PKN ORLEN S.A. (“PKN ORLEN” or “Company”). Neither the Presentation nor any copy hereof may be copied, distributed or delivered directly or indirectly to any person for any purpose without PKN ORLEN’s knowledge and consent. Copying,
Slide 35: Investor Relations contact
For more information on PKN ORLEN, please contact Investor Relations Department: phone: + 48 24 256 81 80 fax: + 48 24 367 77 11 e-mail: ir@orlen.pl www.orlen.pl