Turkiye Petrol Rafinerileri A.s. · BIST:TUPRS
Turkiye Petrol Rafinerileri A.s — Tüpraş — Q4 2020 Earnings Presentation
37 slides from Turkiye Petrol Rafinerileri A.s's earnings presentation, Feb 11, 2021
Slide 1: Q4 2020 Earnings Presentation
Q4 2020 Earnings Presentation 11 February 2021 Hizmete Özel / Confidential
Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking statements that reflect the Company management’s current views with respect to certain future events. Although it is believed that the expectations reflected in these statements are reasonable, they may be affected by variables and changes in und
Slide 3: 2020 Highlights: An Exceptional Year for the Oil Industry
2020 Highlights: An Exceptional Year for the Oil Industry DEMAND Oil demand diminished severely due to the pandemic (c.10% decline in World’s oil demand) Negative crude Jet fuel cracks below zero for 6 OPEC+’s largest prices for the first production cut in time in history consecutive NUMEROUS months
Slide 4: Q4 2020 in Summary
Q4 2020 in Summary Mid distillate cracks showed slight improvement, jet cracks turned into positive territory in Q4 with inventory normalization and recovering demand. Heavy crude differentials widened slightly (q-o-q) but are still narrower than 5-yr averages as a result of OPEC+ supply cuts and st
Slide 5: Q4 2020 Tüpraş Highlights
Q4 2020 Tüpraş Highlights $/bbl Q4 10 Mid-distillate cracks improved in Q4 after historical lows in Q3 2 • Jet fuel cracks turned to positive in October and maintain its upward trend on a monthly basis. -6 Diesel Gasoline Jet WACM* • Gasoline cracks softened primarily due to seasonality, while priva
Slide 6: Market
Market Hizmete Özel / Confidential
Slide 7: Q4 2020 – Key Market Highlights
Q4 2020 – Key Market Highlights Normalization in flights and reduced stock levels have Lower jet fuel stocks helped stabilization in mid-distillate led jet fuel cracks to climb above zero. stocks, pulling them into past five years’ range in Q4. Global Oil Market OECD1 Jet/Kerosene Stocks and Change
Slide 8: Quarterly Crack Margin Comparison ($/bbl) 2016 - 2020
Quarterly Crack Margin Comparison ($/bbl) 2016 - 2020 Diesel cracks improved only marginally due to elevated stock levels. Seasonality weighs on gasoline cracks. 2020 2019 2016-2020 Min - Max Diesel Jet Fuel 16.1 15.4 15.6 - Refineries continued to 13.8 Severe drop in global switch to diesel to redu
Slide 9: Heavy Crude Price Differentials to Brent ($/bbl)
Heavy Crude Price Differentials to Brent ($/bbl) Differentials widened slightly in Q4 but they remain narrow compared to historical averages. 2 0 -2 Arab Heavy -4 Basrah Heavy -6 Kirkuk Ural -8 Average* -10 Iran OPEC+ Cut OPEC+ OPEC+ Cut -12 Sanctions Decision disagreement Decision Q1 Q2 Q3 Q4 Q1 Q2
Slide 10: Operations
Operations Hizmete Özel / Confidential
Slide 11: Capacity Utilization and Quarterly Production Volume
Capacity Utilization and Quarterly Production Volume • Tüpraş produced 6.1 million tons in Q4 2020. • Capacity utilization for Q4 2020 was 84% - supported by domestic demand and improved cracks q-o-q Quarterly Production (Million Tons) Capacity Utilization (%) 2016 2017 2018 2019 2020 Crude Oil Semi
Slide 12: Sales in Q4 (Million Tons)
Sales in Q4 (Million Tons) Tüpraş generated 6.3 million tons of sales in Q4 2020. Y-o-y decline in jet fuel sales off-set by diesel and bitumen. Total Sales Domestic Sales of Selected Products Domestic Sales Exports Diesel Jet Fuel Gasoline Bitumen 7.6 7.6 7.3 7.0 1.3 6.3 0.9 1.0 0.6 0.9 1.5 1.7 0.5
Slide 13: Financials
Kapak fotolarını yenilesek mi? Financials Hizmete Özel / Confidential
Slide 14: Tüpraş Net Margin and Med Complex Margin Comparison ($/bbl)
Tüpraş Net Margin and Med Complex Margin Comparison ($/bbl) Q4 Margins Tüpraş Net Med Margin • Despite Tüpraş’ fundamental cost advantage 10.1 with lower OPEX/bbl, Tüpraş net refining margin declined compared to Q4 2019 due to historically weak crack margins and narrower 6.7 differentials. 5.0 5.0 4
Slide 15: Income Statement (Million TL)
Income Statement (Million TL) EBITDA realized as 383 mn TL in Q4 2020. Q4 Q4 12M 12M Million TL % % 2020 2019 2020 2019 Net Sales 19,990 21,631 -8% 63,244 89,601 -29% COGS -19,396 -20,566 6% -61,480 -84,716 27% Gross Profit 593 1,065 -44% 1,764 4,884 -64% Operating Expenses -535 -540 1% -2,012 -1,78
Slide 16: Q4 Profit Before Tax Bridge (2019-2020)
Q4 Profit Before Tax Bridge (2019-2020) Despite the narrower crude oil differentials and worsening crack margins, Q4 2020 PBT was supported with TL appreciation and inventory gains. Million TL 11/02/2021 Hizmete Özel / Confidential www.tupras.com.tr 16 Earnings Presentation
Slide 17: Profit Before Tax Bridge (2019-2020)
Profit Before Tax Bridge (2019-2020) 2020 PBT was adversely affected from historically low crack margins, lower production and inventory losses due to Covid19 Million TL 11/02/2021 Hizmete Özel / Confidential www.tupras.com.tr 17 Earnings Presentation
Slide 18: Financial Highlights
Financial Highlights EBITDA (mn TL) Q4 Net Income¹ (mn TL) Q4 Q3 3,812 Q3 8,908 3,713 Q2 493 Q2 1,887 Q1 992 1,766 Q1 5,882 1,793 1,457 542 526 1,237 803 3,778 186 4,039 1,027 3,396 581 869 870 -2,494 1,528 738 331 378 376 79 -375 1,505 956 -155 1,542 2,210 545 1,495 383 -2,265 867 1,575 977 688 1,0
Slide 19: Balance Sheet Analysis
Balance Sheet Analysis Net Debt Redemption Schedule (Billion TL) bn TL bn $ In Billion TL In Billion $ 12.4 TL Hard Currency 20 17.8 6 5 15 8.5 12.0 12.2 4 11.0 9.4 5.7 10 8.4 3 6.1 6.2 2 5 2.3 2.3 2.2 1.7 1.7 1.9 1 1.4 1.6 0.1 0.3 1.3 0 0 Dec-16 Dec-17 Dec-18 Dec-19 Mar-20 Jun-20 Sep-20 Dec-20 1 ye
Slide 20: FX Exposure Management (31 December 2020)
FX Exposure Management (31 December 2020) Consolidated Hard Consolidated Hard Currency Assets Currency Liabilities Million $ Payables & Other Cash Liabilities 105 1,785 Receivables & Tüpraş continues to employ strict FX Other Assets ST Financial Loans policies to mitigate currency risks 70 552 • RUP
Slide 21: Outlook for 2021
Outlook for 2021 Hizmete Özel / Confidential
Slide 22: 12M 2020 Results
12M 2020 Results Capacity Utilization (%) Refining Margins ($/bbl) 12M 81.8 81.8 % total capacity 2020 utilization in 12M 2020 0 20 40 60 80 100 Med FY Tüpraş FY Exp Target Operationals -0.2 Med Margin 12M FY Target 24.5 mn tons of sales 12M 2020 and 23.4 mn tons of 23.4 24.5 23 production in 12M 20
Slide 23: 2021 Refinery Maintenance Schedule
2021 Refinery Maintenance Schedule Starting Duration Refinery Unit Purpose Status Quarter (weeks) Batman Crude Oil & Vacuum Q1 7* Seasonal Ongoing Crude Unit Q1 9 Ongoing CCR Q1 10 Ongoing Revamp / Opportunity İzmir FCC Q1 9 Ongoing Maintenance Isomerization Q1 10 Ongoing Desulphurizer Q1 11 Ongoing
Slide 24: 2021 Expectations
2021 Expectations Med Complex Refining Margin 0.0 - 0.5 $/bbl • Better mid-distillate cracks, weaker HSFO cracks compared to 2020 • Ural-Brent differential slightly wider compared to 2020 Tüpraş Net Refining Margin 2.5-3.5 $/bbl • Better mid-distillate and gasoline cracks, weaker HSFO cracks • Flatt
Slide 25: www.tupras.com.tr
www.tupras.com.tr 11/02/2021 Hizmete Özel / Confidential www.tupras.com.tr 25 Earnings Presentation
Slide 26: Appendix
Appendix Hizmete Özel / Confidential
Slide 27: Turkish Market, Jan-Nov 2019/20 (Million Tons)
Turkish Market, Jan-Nov 2019/20 (Million Tons) Diesel ¹Jet Fuel 25 4.5 +1.5% -54.7% 20 15 3.0 4.94 22.78 23.12 10 1.5 5 2.24 0 0.0 2019 2020 2019 2020 Gasoline ²Fuel Oil 1.0 2.0 2.23 -1.1% 0.5 -23.4% 2.20 1.5 0.35 0.27 1.0 0.0 2019 2020 2019 2020 ¹Transit flight consumption included ²Bunker excluded
Slide 28: OPET
OPET Opet has 1,766 fuel stations as of December 2020 - end. Opet Sunpet 1,766 Market Share 1,670 as of November 2020 1,615 1,560 1,504 1,444 1,356 1,393 563 1,279 1,325 463 495 19.60 % 25.44 % 434 431 427 435 410 418 White Black 394 Product Product 1,126 1,152 1,175 1,203 1,009 1,073 885 915 938 96
Slide 29: Crack Margin Effect on Tüpraş in Q4 (FOB Italy Prices)
Crack Margin Effect on Tüpraş in Q4 (FOB Italy Prices) Product Price ($/ton) Tüpraş Crack Margin ($/bbl) Product Production 2020 2019 2020 2019 Yields LPG 387 410 4,5% -9,8 -26,8 Gasoline 397 582 22,9% 4,6 8,5 Naphtha 379 488 0,5% -1,5 -8,1 Jet Fuel 363 601 8,8% 1,9 13,1 Diesel 365 578 41,9% 4,8 14,
Slide 30: Q4 Product Yields
Q4 Product Yields 2019 Q4 2020 Q4 LPG Other Bitumen Other 3% 2% LPG Bitumen 3% Kok 8% 2% 11% 4% Gasoline Kok Gasoline Other 20% 3% Other Fuel Oil 22% white white 5% Light Fuel Oil Light Black Prod.2% Distil. Black Prod. 2% 4% Distil. 17% 24% 18% Naphtha 26% 1% Naphtha 0% Jet Mid. Distil. Mid. Distil
Slide 31: 12M Product Yields
12M Product Yields 2019 12M 2020 12M LPG Other LPG BitumenOther 4% 2% Bitumen 1% 3% 8% 12% Coke Gasoline Gasoline Other Coke 3% 20% Other 21% white 3% Fuel Oil White 2% Light Fuel Oil 9% Black Prod. 1% Light Black Prod. Distil. 2% 17% Distil. 20% 25% Naphtha 25% Naphtha 1% 1% Mid. Distil. Mid. Disti
Slide 32: Tüpraş Balance Sheet (Million TL)
Tüpraş Balance Sheet (Million TL) 31.12.2020 31.12.2019 Diff. Diff. (%) Current Assets 30,663 27,919 2.744 10 Cash & C. Equivalents 19,825 10,652 9,173 86 Trade Receivables 1,736 4,788 -3,052 -64 Derivatives 380 304 76 25 Inventories 7,701 9,469 -1,768 -19 Pre-paid expenses 234 237 -3 -1 Other Curre
Slide 33: Tüpraş and Med Margins ($/bbl)
Tüpraş and Med Margins ($/bbl) Average Margins Tüpraş Net Margin Med Margin 10 9.3 8.1 8 6 5.3 4.6 3.7 4 1.7 1.3 2 0 -0.2 -2 2017 12M 2018 12M 2019 12M 2020 12M Gross Inventory Clean Gross Clean NET Net ($/bbl) Med Margin Margin Effect Margin Margin Margin 2020 Q4 5.6 0.7 4.8 -0.1 0.7 -0.1 2020 12M
Slide 34: Capacity Utilization (%)
Capacity Utilization (%) Q4 Capacity Utilization* 12M Capacity Utilization* Crude Oil Semi Product Feedstock Total Crude Oil Semi Product Feedstock Total 111 108 3 105 99 4 7 98 95 96 96 5 9 7 9 84 9 82 6 6 108 101 101 90 89 87 87 91 78 75 Q4 2016 Q4 2017 Q4 2018 Q4 2019 Q4 2020 2016 2017 2018 2019
Slide 35: Finished Product and Semi Product Imports (Thousand Tons)
Finished Product and Semi Product Imports (Thousand Tons) Product Imports Intermediate Imports Q4 2020 Q4 2019 Q4 2020 Q4 2019 338 200 209 184 120 99 66 20 20 20 - - - - 0 0 0 Diesel ULSD Jet Fuel HVGO ASR F. Oil LSFO Naphtha Alkylate MTBE 11/02/2021 Hizmete Özel / Confidential Earnings Presentation
Slide 36: Annual Sales
Annual Sales • Tüpraş generated 24.5 million tons of total sales in 2020. Total Sales Customer Groups 2020 mn tons 31.5 Other 30.3 29.8 29.2 12% Export 18% 5.5 5.8 4.2 24.5 6.8 Jet 4.7 Bitumen 8% 10% Exports 24.8 25.7 25.6 Total Sales, Domestic Sales 22.4 19.8 2020 24.5 mn tons 2016 2017 2018 2019 2
Slide 37: www.tupras.com.tr
www.tupras.com.tr 11/02/2021 Hizmete Özel / Confidential www.tupras.com.tr 37 Earnings Presentation