Nostrum Oil & Gas Plc · LSE:NOG
Nostrum Oil & Gas — FY2015 Earnings Presentation
22 slides from Nostrum Oil & Gas's earnings presentation, December 2015
Slide 1: Simple Sustainable Successful – FY 2015 Results Presentation
Simple Sustainable Successful FY 2015 Results Presentation
Slide 2: FY 2015 Financial Results
FY 2015 Financial Results Financial and operational stability in a volatile and uncertain oil price environment 1 • Stable production volumes — 14.7mmboe / 40,391 boepd (FY 2014: 16.2mmboe / 44,400 boepd) 2 • Adaptable cost base — 21% reduction in combined Opex1, G&A and transportation costs for the
Slide 3: Snapshot of key figures from 2015
Snapshot of key figures from 2015 Production Net Operating Cash flows1 50,000 44,400 400.0 349.1 40,391 350.0 40,000 300.0 US$m 30,000 250.0 boepd 200.0 153.3 20,000 150.0 100.0 10,000 50.0 - - FY 2014 FY 2015 FY 2014 FY 2015 Gross debt / net debt Opex / boe2 5.0x Gross Debt / LTM EBITDA 4.1x 5.2 US
Slide 4: Capex guidance and drilling programme
Capex guidance and drilling programme Capex guidance (US$m) Commentary • Drilling capex scalable according to oil price environment • Fully funded capex programme both to maintain current production in 2016 and 2017 and complete construction of the GTU III during 2017 335.5 Drilling scalable depende
Slide 5: Resilience under low oil prices
Resilience under low oil prices – Fully funded to complete GTU III and maintain existing production in 2016 and 2017 under any oil price US$170.0m US$242.0m US$275.0m US$160.0m US$28.0m US$130.0m US$165.6m US$50.6m 2015 Operating Net Hedge Income GTU III Drilling Other Finance 2017 Closing Cash Cash
Slide 6: Capital discipline
Capital discipline Balance sheet Hedging programme • US$165.6m cash and cash equivalents¹ on balance sheet at • 15,000 bopd hedge entered into on 14 December 2015 year end • Strike price of US$49.16 • US$400.0m 6.375% Notes maturing in 2019 with no • Settles quarterly for eight quarters (final settl
Slide 7: 2015 Ryder Scott Reserve Audit – Reduction in 2P reserves
2015 Ryder Scott Reserve Audit – Reduction in 2P reserves Chinarevskoye – Proven Chinarevskoye – Probable Trident – Probable • 470mmboe 2P reserves as at 31 December 2015 Proven – 147mmboe 571mmboe Probable – 323mmboe 98mmboe • Remaining reserve life of +10 years with GTU III running at full 470
Slide 8: 2015 Ryder Scott Reserve Audit (cont’d)
2015 Ryder Scott Reserve Audit (cont’d) – Nostrum 2P reserves by reservoir Reservoir Unit 2014 2015 Change Commentary Tournaisian Northeast • Reduction due to volumes produced during 2015 partly offset by better than expected performance [mmboe] 52.7 51.3 (1.4) Tournaisian West of producing wells To
Slide 9: 2015 Ryder Scott Reserve Audit (cont’d) – Conclusion
2015 Ryder Scott Reserve Audit (cont’d) – Conclusion • Decrease in Ryder Scott audited 2P reserves for the Chinarevskoye field from 571mmboe to 470mmboe due to 2015 production of 14.7mmboe Over 70% of 2P reduction due to changes to well design as a result of the low oil prices in order to reduce
Slide 10: A clear path to over 100k boepd
A clear path to over 100k boepd – GTU III delivers material near term production growth Able to deliver Ryder Scott production profile Fully funded at any oil price with oil price of US$44 / bbl • Fully funded to complete the construction of GTU III during 110,000 2017 under any oil price scenario 9
Slide 11: Conclusion – Fully funded low cost producer
Conclusion – Fully funded low cost producer with material production growth potential from GTU III • A sustained recovery in oil prices will lead to a recovery of a significant portion of the decline in 2P reserves • Fully funded to deliver the construction of GTU III during 2017 under any oil price
Slide 12: FY 2015 Financial Results
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Slide 13: Financial Overview – FY 2015
Financial Overview – FY 2015 US$m FY 2015 FY 2014 Change Revenue 448.9 781.9 (42.6%) EBITDA1 229.4 494.7 (53.6%) Profit before tax 72.3 311.7 (76.8%) Current income tax expense (25.7) (111.0) (76.9%) Deferred income tax expense (141.0) (54.2) 160.0% Net income (94.8) 146.4 - Effect of the exchange r
Slide 14: Progress – Snapshot
Progress – Snapshot Opex / boe1 Transport costs / boe 5.2 US$5.1 / boe 8.0 US$7.5 / boe 5.0 7.5 Transport cost / boe Opex / boe 4.8 7.0 4.6 6.5 US$6.3 / boe 4.4 US$4.3 / boe 6.0 4.2 4.0 5.5 3.8 5.0 FY 2014 FY 2015 FY 2014 FY 2015 EBITDA margin Tax / boe2 80% 10.0 US$9.1 / boe 63% 8.0 EBITDA margin 6
Slide 15: Balance Sheet Summary
Balance Sheet Summary Highlights Gross debt / net debt 5.0x Gross Debt / LTM EBITDA • +51% EBITDA¹ margin 4.1x 4.0x Net Debt / LTM EBITDA 3.4x • US$165.6m cash & equivalents² Leverage ratio 2.8x 3.0x 1.9x 2.1x • 15,000 bopd production hedged at US$49.16 / bbl for 24 2.0x months (value of c.US$200m @
Slide 16: Supporting materials
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Slide 17: Consolidated Statement of Financial Position
Consolidated Statement of Financial Position 17
Slide 18: Consolidated Statement of Comprehensive Income
Consolidated Statement of Comprehensive Income 18
Slide 19: Consolidated Statement of Cash Flows
Consolidated Statement of Cash Flows 19
Slide 20: Deferred Tax Explanation
Deferred Tax Explanation Overview Illustrative impact of Tenge devaluation • Corporate income tax is recognised based on the estimated annual effective income tax rate applied to the income before tax for a relevant reporting period • Differences between the recognition criteria in IFRS and under st
Slide 21: Deferred Tax Explanation
Deferred Tax Explanation FY Cash US$mm Commentary 2015 impact • +95% of the Company’s revenues are received in US Dollars or have Revenue 448.9 pricing which is US Dollar linked Opex (62.9) • c.80% of the Company’s Opex is denominated in Tenge Transport costs (93.0) • +90% of the Company’s transport
Slide 22: Disclaimer
Disclaimer THIS PRESENTATION IS NOT AN OFFER OR SOLICITATION OF AN OFFER TO BUY OR SELL SECURITIES. IT IS SOLELY FOR USE AT AN INVESTOR PRESENTATION AND IS PROVIDED AS INFORMATION ONLY. THIS PRESENTATION DOES NOT CONTAIN ALL OF THE INFORMATION THAT IS MATERIAL TO AN INVESTOR. BY ATTENDING THE PRESEN