Orlen Spolka Akcyjna · GPW:PKN
Orlen Spolka Akcyjna — Grupa LOTOS — Q2 2016 Earnings Presentation
30 slides from Orlen Spolka Akcyjna's earnings presentation, Aug 11, 2016
Slide 1: LOTOS Group 2Q 2016 consolidated financial results
LOTOS Group 2Q 2016 consolidated financial results August 11, 2016 1
Slide 2: Agenda
1 Strategic update 4-6 2 Key highlights 7-9 3 External environment 10 - 14 4 Upstream 15 - 19 5 Downstream 20 - 25 6 Consolidated financial results 26 - 30 2
Slide 3: Strategic update
Ss LOTOS Strategic update
Slide 4: Strategic update – Key strategic assumptions
0 Strategic update – Key strategic assumptions Long term (2018+) Short term (until 2018) Key assumptions underlying Strategy Pursue further the LOTOS Group's strategy Identify strategic growth directions development Resume dividend payments and formulate development plans projects without and
Slide 5: Strategic update – Clean EBITDA LIFO and key macro factors
Strategic update – Clean EBITDA LIFO and key macro factors On the continuous path of operational result improvement despite deteriorating macro environment m PLN USD/bbl 112 2 156 109 2 021 99 8,45 7,77 1 391 6,50 5,70 6,08 1 577 1 091 1 779 1 094 875 52 796 740 40 445 505 339 304 352 2012 2013 2014
Slide 6: Strategic update – CAPEX vs Operating Cash Flow and Net Debt/clean LIFO EBITDA
Strategic update – CAPEX vs Operating Cash Flow and Net Debt/clean LIFO EBITDA Generating sufficient cash flow to finance the development program m PLN 1 488 1 416 1 381 1 347 950 1 420 5,2x 1 132 3,8x 980 814 3,1x 2,6x 2,5x 614 2012 2013 2014 2015 H1 2016 2012 2013 2014 2015 H1 2016 (1) CAPEX Opera
Slide 7: Key highlights
Ss LOTOS Pe Key highlights
Slide 8: Key highlights 2Q 2016
Key highlights 2Q 2016 y/y % change EBITDA Clean(1) EBITDA PLN m Clean EBITDA reported LIFO LIFO Consolidated 810 546 -9% upstream 114 197 +92% downstream 704 357 -30% Operating cash flow 631 m PLN Crude oil throughput 2 513 k tons Upstream production 28 555 boe/d Note : Values for the segments abov
Slide 9: Key highlights 1HY 2016
Key highlights 1HY 2016 y/y % change EBITDA Clean(1) EBITDA PLN m Clean EBITDA reported LIFO LIFO Consolidated 1 211 1 094 +3% upstream 264 352 +98% downstream 946 740 -12% Operating cash flow 950 m PLN Crude oil throughput 4 957 k tons Upstream production 29 016 boe/d Note : Values for the segments
Slide 10: External environment
Ss LOTOS ey External environment 10
Slide 11: External environment - crude oil prices and natural gas prices
External environment - crude oil prices and natural gas prices USD/boe Avg Brent/Ural spread (left axis) Avg Brent price (right axis) Avg Nat Gas price (BTU) (right axis) 57 4.5 3.5 47 48 48 47 48 50 44 2.5 42 38 38 38 1.5 34 35 34 30 31 32 0.5 29 27 25 30 -0.5 -1.3 26 24 23 23 -1.5 -1.5 -1.5 -2.6 -
Slide 12: External environment - product crack spreads
External environment - product crack spreads USD/bbl Diesel crack Gasoline crack 30 24.2 25.2 25 27.2 19.2 16.6 18.6 18.9 19.3 17.4 20 16.6 16.2 16.0 15.9 19.3 14.7 18.5 12.9 15 18.2 17.7 17.7 18.0 15.4 14.5 13.3 10 11.7 11.5 11.7 12.3 11.5 11.7 5 0 Apr 15 May 15 Jun 15 Jul 15 Aug 15 Sep 15 Oct 15 N
Slide 13: Model refining margin vs. peers
Model refining margin vs. peers (1) (1) (2) USD/bbl LOTOS PKN ERMI 12.00 11.30 11.40 10.00 9.20 8.00 8.60 8.20 8.00 7.36 7.45 6.00 6.41 4.77 4.76 9.38 5.18 4.00 8.08 7.41 (3) (3) 6.21 6.51 6.49 2.00 0.00 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 (1) Source: Company data; based on websites of the companies (2) S
Slide 14: External environment – GDP growth, FX development & domestic fuel consumption
External environment – GDP growth, FX development & domestic fuel consumption (2) (4) mln m3 % Polish GDP growth Diesel consumption 3.9 3.9 3.8 3.8 3.7 3.7 3.6 3.6 3.5 3.4 3.3 3.3 1Q 2015 2Q 2015 3Q 2015 4Q 2015 1Q 2016 2Q 2016 1Q 2015 2Q 2015 3Q 2015 4Q 2015 1Q 2016 2Q 2016 USD/PLN (3) mln m3 Gasol
Slide 15: Upstream
Ss LOTOS iy Upstream 15
Slide 16: Hydrocarbons reserves and production figures
Hydrocarbons reserves and production figures Average daily oil&gas production (boe/d)(1) 2P(2) oil&gas reserves (m boe) 29 816 66.8 28 555 64.2 1 157 1 111 61.9 7.1 6 234 7.0 6.9 5 595 13 771 40.6 40.0 39.6 1 203 22 425 21 849 5 829 6 739 19.1 17.1 15.4 4Q'15 1Q'16 2Q'16 Dec 15 Mar 16 Jun 16 Norway
Slide 17: Quarterly sales split by products and countries
Quarterly sales split by products and countries 2Q 2015 1Q 2016 2Q 2016 2 074 ths boe 1 791 75% 74% 660 498 500 334 3% 3% 66% 5% 91 88 91 Norway Poland Lithuania Norway Poland Lithuania Norway Poland Lithuania Oil Gas (1) share of natural gas in total sales (in %) 17
Slide 18: Quarterly upstream's EBITDA
Quarterly upstream’s EBITDA m PLN +92% 197 155 103 (1) EBITDA 2Q 2015 Clean EBITDA 1Q 2016 Clean EBITDA 2Q 2016 5 83 -69 -138 103 155 -142 197 150 59 114 34 13 (2) (2) EBITDA 2Q 15 Depreciation Clean EBIT EBITDA One offs Clean Depreciation Clean EBIT EBITDA One offs Clean Depreciation Clean EBIT 2Q
Slide 19: Half year upstream's EBITDA
Half year upstream’s EBITDA m PLN +98% 352 178 (1) EBITDA H1 2015 Clean EBITDA H1 2016 88 132 281 178 352 264 71 46 (2) EBITDA H1 15 Depreciation EBIT H1 16 EBITDA H1 16 One offs Clean EBITDA Depreciation Clean EBIT H1 16 H1 16 (1) No one offs in the reported period (2) Assets impairments 19
Slide 20: Downstream
Ss LOTOS Downstream 20
Slide 21: Refinery production - volumes, throughput & utilisation rate
Refinery production - volumes of key products, crude oil throughput & utilisation rate Oil throughput (k tons) Refinery utilisation (%) k tons 120% 3 600 100% 100% 110% 97% 99% 3 200 93% 93% 100% Crude oil throughput at 2 629 k tons, 2 800 2 628 2 651 2 555 90% 2 379 2 444 2 513 80% with capacity ut
Slide 22: Retail performance and domestic fuel sales
Retail performance and domestic fuel sales Quarterly retail EBITDA Petrol stations network (no. of units) Quarterly retail sales volumes m PLN k tons +7% r/r +21% r/r 447 478 196 198 33 313 336 303 27 20 281 280 2Q 2015 1Q 2016 2Q 2016 Mar 2016 Jun 2016 2Q 2015 1Q 2016 2Q 2016 Premium Optima 22
Slide 23: Quarterly downstream's EBITDA
Quarterly downstream’s EBITDA m PLN -30% 508 383 357 Clean EBITDA 2Q 2015 Clean EBITDA 1Q 2016 Clean EBITDA 2Q 2016 -61 -48 -12 -57 -2 -38 192 -327 664 704 -7 383 508 241 357 (1) (2) (3) (2) (3) EBITDA LIFO effect LIFO FX Clean LIFO EBITDA LIFO effect LIFO FX Clean LIFO EBITDA LIFO effect LIFO FX (2
Slide 24: Half year downstream's EBITDA
Half year downstream’s EBITDA m PLN -12% 840 740 Clean EBITDA H1 2015 Clean EBITDA H1 2016 -46 180 -100 -376 6 -10 980 840 946 740 (1) (2) (3) (2) EBITDA H1 15 LIFO effect LIFO inventory FX differences Clean EBITDA EBITDA H1 16 LIFO effect LIFO inventory FX differences Clean EBITDA impairment H1 15
Slide 25: Consolidated financial results
Consolidated financial results 25
Slide 26: Decomposition of consolidated quarterly operational results
Decomposition of consolidated quarterly operational results 2Q 2016 -12 -7 m PLN -245 260 551 546 287 (1) (2) EBIT LIFO effect FX differences One offs Clean EBIT LIFO Depreciation Clean EBITDA LIFO 2Q 2015 187 -61 -38 -58 569 599 413 (1) (3) EBIT LIFO effect FX differences One offs Clean EBIT LIFO D
Slide 27: Decomposition of consolidated half year operational results
Decomposition of consolidated half year operational results H1 2016 m PLN -10 522 180 -287 1 094 688 571 (1) (2) EBIT LIFO effect FX differences One offs Clean EBIT LIFO Depreciation Clean EBITDA LIFO H1 2015 364 -46 6 -100 1 061 836 696 (1) (3) EBIT LIFO effect FX differences One offs Clean EBIT LI
Slide 28: Quarterly operating cash flows and CAPEX
Quartely operating cash flows and CAPEX Operating cash flows Capital Expenditures m PLN 325 289 100 77 upstream 631 564 downstream (1) (1) (2) 402 225 212 319 200 2Q 15 3Q 15 4Q 15 1Q 16 2Q 16 1Q 2016 2Q 2016 (1) Including EFRA Programme – PLN 189m (2) Including EFRA Programme – PLN 130m 28
Slide 29: Debt
Debt (2) (1) Net debt Gearing ratio Net debt/LTM clean EBITDA LIFO 5 701 74% 70% 2,6x 5 366 67% 2,5x 2,5x Dec 2015 Jun 2016 Dec 2015 Mar 2016 Jun 2016 Dec 2015 Mar 2015 Jun 2016 Net debt figures include: interest bearing loans and borrowings, finance lease and bonds The current gearing ratio at
Slide 30: Grupa LOTOS S.A. Investor Relations
Grupa LOTOS S.A. Investor Relations tel. +48 58 308 73 93 fax +48 58 346 22 35 e-mail ir@grupalotos.pl Twitter : @GrupaLOTOS 30