Slide 1: OMV Petrom results Jan – Jun and Q2/15
OMV Petrom results Jan – Jun and Q2/15 August 12, 2015
Slide 2: Content
Content Market environment Operational and financial highlights Upstream update Outlook 2015 Note: All the figures refer to OMV Petrom Group (herein after also referred to as “the Group”). The financials represent OMV Petrom Group’s consolidated results prepared according to IFRS (Q2/15 financials a
Slide 3: Market environment
Market environment Andreas Matje, CFO
Slide 4: Business environment
Business environment Latest available data as of July 2015 International environment Romania: macroeconomic stability Oil price fell by 47% in H1/15 vs IMF3 estimate for 2015 GDP growth at H1/14 3.8%. In Q1/15 GDP rose by 4.1% yoy Oil demand and supply in Europe: CPI annual inflation: 12-month avg.
Slide 5: Economic environment
Economic environment Oil price (USD/bbl) and FX (USD/RON) OMV Petrom Indicator refining margin1 (USD/bbl) 8.95 120 108 4.5 9 4.02 5.11 6 90 4.0 60 3.5 0 3.23 61 (1.88) 30 3.0 -6 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Avg Urals price (left scale) Avg USD/RON (right scale) Gas pri
Slide 6: Dynamics of the Romanian energy sector
Dynamics of the Romanian energy sector Demand 1 Fuels +12%; Gas -7%; Power +2%; Demand and prices Prices 6m/15 vs 6m/14 Urals: -47% Gas price deregulation for HH4 continued; power prices2 almost stable Gas and Power: undergoing structural changes Price liberalization: NHH3 completed; HH4 continues (
Slide 7: Operational and financial highlights
Operational and financial highlights Andreas Matje, CFO
Slide 8: Q2/15 overview
Q2/15 overview Clean CCS EBIT (RON mn) Production stable at 181 kboe/d -43% 1,147 RON weaker than USD Average Urals crude price at USD 61.42/bbl 657 Significantly higher refining margin 1,330 551 Gas sales volumes of 10.57 TWh (~ 1 bcm) Upstream Downstream Oil Net electrical output of 0.11 TWh 304 D
Slide 9: Special items and CCS effect
Special items and CCS effect Q2/15 (RON mn) in RON mn Q2/15 Q2/14 Clean CCS EBIT 657 1,147 786 CCS gains/ (losses) 47 14 657 (15) (5) 102 Clean EBIT 704 1,161 47 Personnel related costs (15) (1) Other impairments (5) (491) Assets disposal 0 (43) Other 102 0 Total special items 82 (535) Reported EBIT
Slide 10: Clean CCS net income
Clean CCS net income Clean CCS net income attributable in RON mn Q2/15 Q2/14 ∆ to stockholders (RON mn) EBIT 786 626 26% Financial result 43 (55) n.m. -42% Income tax (138) (259) (47)% 827 Effective tax rate 17% 45% (63)% Net income 691 312 122% Minorities (1.46) 0.85 n.m. 481 Net income attributabl
Slide 11: Cash flow
Cash flow 6m/15 (RON mn) in RON mn 6m/15 6m/14 ∆ Profit before taxation 1,301 1,911 (32)% Depreciation and amortization 1,847 2,148 (14)% (59) (420) Net interest received/ (paid) 125 (25) n.m. Tax on profit paid (420) (463) (9)% 1,847 Other (344) 125 n.m. Sources of funds 2,510 3,695 (32)% (2,874) C
Slide 12: CAPEX and EBITDA
CAPEX and EBITD 6m/15 (RON mn) Key investment projects 3,128 Upstream: Field redevelopment executions, workover activities, drilling as well as investments related to Neptun 2,069 2,167 Deep project 1,947 Downstream Oil: 3+3 terminals strategy, 1,150 efficiency, legal and environmental 118 0 project
Slide 13: Upstream – Clean EBIT
Upstream– Clean EBIT Q2/15 vs Q1/15 (RON mn) Q2/15 vs Q2/14 (RON mn) 1,330 50 (67) 69 551 551 (892) 20 (44) 138 175 324 Q1/15 Realization Volume Exploration Other Q2/15 Q2/14 Realization Volume Exploration Other Q2/15 expenses expenses ► Higher realized oil sales ► Lower oil price, partly offset by
Slide 14: Upstream – KPIs
Upstream– KPIs Hydrocarbon production (kboe/d) OPEX (USD/boe) Oil and NGL Gas 180 178 182 184 181 -30% 18.70 16.37 17.02 14.23 13.16 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 ► Group hydrocarbon production dropped ► Production costs on a downward by 1% vs Q1/15 trend also supported
Slide 15: Downstream Oil
Downstream Oil Clean CCS EBIT Q2/15 vs Q2/14 (RON mn) Refining and Marketing 304 1.2 101% 103% 82 86% 81% 177 0.94 0.88 75 0.83 0.89 46 59% 0.75 0.6 50 Q2/14 Refining Marketing Q2/15 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Refinery utilization rate (%) 1 Marketing sales volumes in mn t (left scale) ► Strong R
Slide 16: Downstream Gas
Downstream Gas Clean EBIT Q2/15 vs Q2/14 (RON mn) ► EBIT impacted in Q2/15 by RON ~(40) mn provisions for outstanding receivables (14) ► Gas sales volumes decrease by 6% due to lower sales (65) (84) to the fertilizer industry and heat & power sector (3) (3) ► Average spark spreads remained negative
Slide 17: Upstream update
Upstream update Gabriel Selischi, EB member
Slide 18: Upstream in H1/15
Upstream in H1/15 Delivery on promises in Romania 0.37 Lowest LTIR1 since privatization ~25% OPEX2 reduction vs H1/142 ~30% Reduction of CAPEX (excl. E&A3) vs H1/14 s H1/2014013 ~1% Marginal production increase vs H1/14 4 Deep offshore wells finalized 1 Lost time injury rate (employees and contracto
Slide 19: Upstream: High safety and efficiency focus
Upstream High safety and efficiency focus Operations safety - our top priority Upstream LTIR1 Romania irrespective of cost reduction LTIR substantially improved 1.6 H1/15: the lowest level since privatization Lower than IOGP2 international benchmark > 40% reduction 0.8 0.63 0.60 0.53 0.48 Significan
Slide 20: Upstream: Reduced Group OPEX to a new base
Upstream Reduced Group OPEX to a new base USD/boe OPEX H1/15 decreased by 23% -23% compared to H1/14 mainly due to: 17.86 ► Favorable FX effects 13.70 ~Stable ► Lower personnel costs (outsourcing, overtime, leased personnel) ► Lower material costs (consumables, electricity, shut down of uneconomic w
Slide 21: Upstream: Group CAPEX adjusted to the new oil price environment
Upstream Group CAPEX was adjusted to the new oil price environment Upstream CAPEX (excl. E&A) ► Maintain guidance of 25-35% CAPEX reduction RON mn for 2015 vs 2014 -28% ► CAPEX (excl. E&A) reduced by ~30% in H1/15 compared to H1/14: ► FRDs prioritization and re-engineering H1/14 H1/15 Kazakhstan Dev
Slide 22: Upstream: Scaled down investments will impact production
Upstream Scaled down investments will impact production ► H1/15 Group production ~1% higher compared to Production in Romania, same period last year kboe/d, CAGR ► Workovers in H1/15 ~7% higher contribution to daily production -3% ► FRDs (incl Totea) contribution to production up to almost doubled v
Slide 23: Upstream – Offshore exploration: Neptun Deep activity continues
Upstream – Offshore exploration Neptun Deep: activity continues Drilling campaign 2014/2015: Domino-2, Pelican South-1, Dolphin-1, Flamingo-1 and Califar-1 wells were finalized Data under evaluation Exploration drilling campaign to continue throughout this year The potential for commercial developme
Slide 24: Upstream Outlook H2/15: Adapt to the new oil price environment
Upstream Outlook H2/15 Adapt to the new oil price environment ► No compromise on safety HSSE ► Focus on behavioral change Operational ► Strive to limit production decline in 2015 excellence ► Implement leaner & simpler operational processes ► Simplicity & Standardization ► Adjust if further ► Re-set
Slide 25: Outlook 2015
Outlook 2015 Andreas Matje, CFO
Slide 26: Outlook 2015
Outlook 2015 Oil price: Brent average between USD 50-60/bbl International market Refining margin: Expected to decline from 6m/15 levels Gas: Demand not expected to recover, increased competition Romanian Power: Demand stable, prices under pressure with short-term upside from weather conditions marke
Slide 27: Strict CAPEX and cost management
Strict CAPEX and cost management ► Group CAPEX reduced by ~EUR 0.4 bn1 in 2015 Group CAPEX adjustments ► Neptun Deep continuing exploration activities EUR 1.4 bn ► Efficiency and cost reduction program in place ~ EUR 1bn Tight personnel policy Upstream ~86% Significant reduction in use of agency sta
Slide 28: Closing remarks
Closing remarks ► Strong foundation to cope with current market downturn ► Consistent delivery on promises regarding CAPEX and OPEX adjustments, within the current market environment ► Maximize integrated value ► Neptun Deep exploration to continue ► Public consultations on taxation and regulatory f
Slide 29: Legal Disclaimer
Legal Disclaimer This presentation does not, and is not intended to, constitute or form part of, and should not be construed as, constituting or forming part of, any actual offer to sell or issue, or any solicitation of any offer to purchase or subscribe for, any shares issued by the Company or any
Slide 30: Contact Investor Relations
Contact Investor Relations OMV Petrom Investor 2015 Financial Calendar Relations Nov 5: Q3 2015 results Tel.: +40 372 088406 E-mail: investor.relations.petrom@petrom.com Homepage: www.omvpetrom.com 29 | OMV Petrom results Jan-Jun and Q2 2015