Mol Hungarian Oil & Gas Plc Class A · BET:MOL
Mol Hungarian Oil & Gas Plc Class A — MOL Group — Q4 2023 Earnings Presentation
44 slides from Mol Hungarian Oil & Gas Plc Class A's earnings presentation, Feb 16, 2024
Slide 1: Fourth Quarter 2023 Results
FOURTH QUARTER 2023 RESULTS 16 FEBRUARY 2024
Slide 2: Disclaimer
DISCLAIMER "THIS PRESENTATION AND THE ASSOCIATED SLIDES AND DISCUSSION CONTAIN FORWARD -LOOKING STATEMENTS. THESE STATEMENTS ARE NATURALLY SUBJECT TO UNCERTAINTY AND CHANGES IN CIRCUMSTANCES. THOSE FORWARD-LOOKING STATEMENTS MAY INCLUDE, BUT ARE NOT LIMITED TO, THOSE REGARDING CAPITAL EMPLOYED, CAPI
Slide 3: Highlights of the Quarter
HIGHLIGHTS OF THE QUARTER
Slide 4: 2023 Guidance Met on All Fronts
2023 GUIDANCE MET ON ALL FRONTS 2022 2023 2023 RESULTS GUIDANCE RESULTS GROUP CLEAN CCS ~USD 2.8 BN USD 3.1 BN EBITDA USD 4.7 BN OIL & GAS ~90 MBOEPD 90.4 MBOEPD PRODUCTION1 92 MBOEPD CRUDE PROCESSING2 ~12 MT 12.1 MT 11.8 MT GROUP CAPEX <1.7 BN USD 1.42 bn USD 1.52 BN (ORGANIC) NET DEBT/EBITDA 0.3X
Slide 5: Q4 2023 Clean CCS EBITDA Slightly Up Q-o-Q
Q4 2023 CLEAN CCS EBITDA SLIGHTLY UP Q-O-Q RESULTS HELPED BY RESILIENT UPSTREAM AND DOWNSTREAM PERFORMANCE AND CORE GROWTH IN CONSUMER SERVICES FINANCIALS Clean CCS EBITDA decreased by 8% YoY and increased by 2% Q-o-Q to USD 992mn in Q4 2023, with 2023 FY operating CF after WC surpassing USD 2.1bn U
Slide 6: TRIR 6% Lower in 2023 than in 2022
TRIR 6% LOWER IN 2023 THAN IN 2022 ESG KPI INTRODUCED TO MANAGEMENT INCENTIVE SCHEME TOTAL RECORDABLE INJURY RATE (TRIR) TRIR RESULTS & ESG INCENTIVE Guidance for 2023 (1.4) 2023 TRIR 6% lower than 2022, well below guidance of 1.4 1.45 -6% Above-expectation TRIR in 2022 triggered stronger focus on s
Slide 7: Waste Management 2023 Performance
WASTE MANAGEMENT 2023 PERFORMANCE 2023 IN NUMBERS1 2023 CAPEX PROGRESS DRS (Deposit Refund System) had significant Capex relevance as ~2000 machines were installed in cooperation with main retail chains Implementation of the first own waste yard investment started, preparatory works of further 9 was
Slide 8: 2024 Guidance
2024 GUIDANCE 2022 2023 2024 RESULTS RESULTS GUIDANCE GROUP PROFIT BEFORE ~USD 1.6 BN USD 3.1 BN USD 1.9 BN TAX GROUP CLEAN CCS ~USD 3.0 BN EBITDA USD 4.7 BN USD 3.1 BN OIL & GAS 92 MBOEPD 90.4 MBOEPD ~90 MBOEPD PRODUCTION1 CRUDE PROCESSING2 11.8 MT 12.1 MT ~12 MT GROUP CAPEX USD 1.52 BN USD 1.42 bn
Slide 9: Key Group Quarterly Financials
KEY GROUP QUARTERLY FINANCIALS
Slide 10: Q4 2023 EBITDA Up Quarter-on-Quarter
Q4 2023 EBITDA UP QUARTER-ON-QUARTER ALL KEY SEGMENTS CONTRIBUTED TO THE OUTSTANDING RESULT SEGMENT CLEAN CCS EBITDA (USD mn) COMMENTS Upstream 1,449 -8% +2% Q4 2023 EBITDA close to doubled q-o-q due to the change of royalty regime 1,074 and revamp in production 977 992 196 Downstream 492 714 375 Do
Slide 11: Capex Picked Up in Q4 Due to Seasonality
CAPEX PICKED UP IN Q4 DUE TO SEASONALITY 2023 TOTAL ORGANIC SPENDING REMAINED BELOW USD 1.7BN GUIDANCE TOTAL GROUP CAPEX (USD mn) TOTAL GROUP CAPEX (USD mn) -40% +73% -40% +73% 1,014 1,014 459 459 614 605 0 614 605 113 135 334 350 14 282 337 350 245 88 334 486 197 422 14 141 82 197 69 19 1 266 13 51
Slide 12: Net Income Nears USD 1.5 BN in 2023
NET INCOME NEARS USD 1.5 BN IN 2023 BOTTOM LINE HELPED BY LOWER TAX RATE FY 2023 EARNINGS (USD mn) – BELOW THE EBITDA LINE ITEMS 3,093 73 69 Other 117 Consumer Services 695 1,337 36 2 345 Downstream 1,328 3,162 107 1,898 1,936 1,484 Upstream 953 Clean CCS CCS EBITDA excl. Special items DD&A and Prof
Slide 13: USD 40mn FX Driven Financial Gain in Q4 2023
USD 40MN FX DRIVEN FINANCIAL GAIN IN Q4 2023 CCS effect, gain / loss (USD mn) Comments -3% 73 69 CCS loss in Q4 due to decreasing crude prices -103 -100 -102 FY 2022 FY 2023 Q4 2022 Q3 2023 Q4 2023 DD&A (USD mn) +13% 63% +6% Above average Q4 DD&A driven by impairment in Poland 1 337 retail of USD 17
Slide 14: Income Tax Expense Lower Due to Drop in Net Income
INCOME TAX EXPENSE LOWER DUE TO DROP IN NET INCOME Income tax expenses (USD mn) Comments Deferred -31 -24 27 71 -98 tax: -78% 11% -72% Income tax higher quarter-over-quarter in Q4 due to higher deferred taxes compensating for the effect 613 1 223 of lower PBT 122 136 345 Q4 2022 Q3 2023 Q4 2023 FY 2
Slide 15: Operating Cash Flow Resilient Even After High Cash Tax
OPERATING CASH FLOW RESILIENT EVEN AFTER HIGH CASH TAX SUPPORTED BY USD 296MN RELEASE OF WORKING CAPITAL OPERATING CASH FLOW FOR TOTAL OPERATION IN 2023 (USD mn) 1,337 1,306 Discontinued 2,138 Operation (UK) 1,935 1,842 296 124 1,415 Continuing operation 1,936 1 Profit Before Tax DD&A Income tax pai
Slide 16: Net Debt to EBITDA Flat
NET DEBT TO EBITDA FLAT INDEBTEDNESS SAFELY BELOW TOLERANCE THRESHOLD EVEN AFTER DISTRIBUTION OF RECORD DIVIDEND NET DEBT TO EBITDA (x) GEARING (%) 2.0 30 27.3 25.2 1.61 25 1.5 20.6 1.31 19.6 20 18.6 18.1 17.5 0.97 14.0 14.5 14.0 1.0 15 0.82 12.0 0.74 11.4 0.65 0.65 10.0 0.59 0.59 0.59 10 0.5 0.41 6
Slide 17: Downstream Q4 2023 Results
DOWNSTREAM Q4 2023 RESULTS
Slide 18: Higher Downstream Contribution YoY in Q4 2023
HIGHER DOWNSTREAM CONTRIBUTION YOY IN Q4 2023 Y-O-Y CLEAN CCS EBITDA GROWTH OF 19% DRIVEN BY HIGHER VOLUMES AND CHANGE IN GOVERNMENT TAKE QUARTERLY CLEAN CCS EBITDA (USD mn) TOTAL CRUDE PROCESSED (kt)1 TOTAL PRODUCT SALES (kt) +3% -12% 741 5,168 5,382 +19% -3% +4% -4% 4,752 288 4,762 4,601 469 280 4
Slide 19: Refining Margin Dropped in Q4 2023
REFINING MARGIN DROPPED IN Q4 2023 PETCHEM MARGINS STILL WEAK BUT SLIGHTLY INCREASED QOQ REFINING MARGIN (USD/bbl) COMMENTS Brent-based MOL Group refinery margin (USD/bbl) (Ex-Ural) refining margins weakened considerably in Q4 2023 in line with Brent-based Complex refinery margin (MOL+Slovnaft) (USD
Slide 20: Annual DS Contribution Above USD 1.3 BN
ANNUAL DS CONTRIBUTION ABOVE USD 1.3 BN HEALTHY FUNDAMENTALS PARTIALLY SPOILED BY GOVERNMENT TAKE EFFECTS DOWNSTREAM CLEAN CCS EBITDA YoY, Q4 2022 VS. Q4 2023 (USD mn) COMMENTS 456 384 60 R&M price & margin effect negative Y-o-Y due to lower 105 351 Brent-based margins and narrower B-U spread partly
Slide 21: Consumer Services Q4 2023 Results
CONSUMER SERVICES Q4 2023 RESULTS
Slide 22: CS Q4 EBITDA Showing 61% Growth Y-o-Y
CS Q4 EBITDA SHOWING 61% GROWTH Y-O-Y RESULTS SUPPORTED BY ORGANIC MARGIN IMPROVEMENT QUARTERLY EBITDA (USD mn) EBITDA YoY, Q4 2023 VS. Q4 2022 (USD mn) 61% +53% +61% 29 53 136 144 7 71 250 89 175 121 127 144 89 USD mn Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 EBITDA Q4 Fuel volume Non-fuel Re
Slide 23: Q4 2023 Fuel Sales Volume Increased by 10% Y-o-Y
Q4 2023 FUEL SALES VOLUME INCREASED BY 10% Y-O-Y AVERAGE THROUGHPUT PER SITE DECREASED SLIGHTLY IN Q4 2023 YOY TOTAL VOLUMES SOLD (mn litres) FUEL THROUGHPUT/SITE1 (mn litres) -2% +10% 1 991 4Y CAGR: 260 +2.65% 0.91 0.89 2 306 0.80 0.78 1 916 1 969 0.72 1 810 1 706 1 731 Q3 2022 Q4 2022 Q1 2023 Q2 2
Slide 24: Non-Fuel Margin Expanded by 32% YoY in Q4 2023
NON-FUEL MARGIN EXPANDED BY 32% YOY IN Q4 2023 NON-FUEL MARGIN SHARE STOOD AT 34% NON-FUEL MARGIN (USD MN – CONST. FX) TOTAL NON-FUEL TURNOVER (USD MN – CONST. FX) +32% +27% 150.3 519.3 115.8 121.2 413.9 432.6 101.9 375.5 361.8 91.8 92.5 340.4 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q3 2022
Slide 25: En Route in Realisation of Consumer Goods Retailer Concept
EN ROUTE IN REALISATION OF CONSUMER GOODS RETAILER CONCEPT LOYALTY PROGRAM AND STRONG NETWORK DEVELOPMENT CONTINUE TO ADD VALUE GROWTH IN NR. OF PRODUCTS SOLD, 2023 V 2022 (%) LOYALTY PENETRATION1 (%) ACTIVE LOYALTY CUST. 2 (MN) +4pp +10% 22% 3.4 Like-for-like 3.1 Coffee Cups 7% 20% Acquisition effe
Slide 26: Upstream Q4 2023 Results
UPSTREAM Q4 2023 RESULTS
Slide 27: E&P EBITDA ex SI Rose to USD 375 MN in Q4 2023
E&P EBITDA EX SI ROSE TO USD 375 MN IN Q4 2023 SLIGHTLY HIGHER REALISED HYDROCARBON PRICES Q-O-Q AND END TO EXTRA ROYALTIES QUARTERLY EBITDA (excl. special items) (USD mn) OIL PRICES 140 113.9 134.0 120 100.8 -24% +92% 93.6 102.4 100 102.2 103.9 88.9 84.3 79.8 107.5 97.1 77.8 78.1 73.5 81.8 81.2 81.
Slide 28: Unit Free Cash Flow at 20 USD/boe in 2023
UNIT FREE CASH FLOW AT 20 USD/BBL IN 2023 ANNUAL SFCF DECREASED TO USD 587 MN CAUSED BY LOWER HYDROCARBON PRICES QUARTERLY PRICE REALIZATION, EBITDA, SFCF (USD/boe) 140 134 120 102 100 101 87 84 81 78 80 80 89 68 Brent 60 62 78 67 49 Realised HC price 40 67 68 36 28 Unit EBITDA 20 44 15 33 25 15 Uni
Slide 29: Q4 Results Driven by More Rational HU Royalty Regime
Q4 RESULTS DRIVEN BY MORE RATIONAL HU ROYALTY REGIME ANNUAL FIGURES REFLECT THE LOWER HYDROCARBON PRICE ENVIRONMENT UPSTREAM EBITDA QoQ, Q4 2023 VS. Q3 2023 (USD mn) COMMENTS +2 +6 -3 Positive price impact reflects better realized HC +16 0 prices but was overwhelmingly driven by the +167 effects of
Slide 30: Production Above 2023 Target
PRODUCTION ABOVE 2023 TARGET DESPITE CONTINUED SHUTDOWN OF THE KRI-TURKEY EXPORT PIPELINE PRODUCTION BY COUNTRY (mboepd) COMMENTS QUARTERLY ANNUAL Production totalling 91.5 mboepd in Q4 2023 , up 4.7 mboepd QoQ (vs. Q3 2023): 95.9 CEE: +2.8 mboepd Series 90.9 91.5 92.0 90.4 90.5 90.6 ~90.0 ~90.0 10.
Slide 31: Group Level Unit Opex Normalised Q-o-Q to 6.0 USD/boe
GROUP LEVEL UNIT OPEX NORMALISED Q-O-Q TO 6.0 USD/BOE FY 2023 CAPEX IN LINE WITH 2022 FIGURE UNIT OPEX (USD/boe) UNIT OPEX YTD (USD/boe) ORGANIC CAPEX (USD mn) GROUP FULLY CONSOLIDATED 7.5 (INCL. JVS/ASSOC.) SUBS. +4% -2% +20% 7.0 7.2 +18% 375 366 40 6.5 65 6.5 6.6 6.4 5.9 6.3 6.0 5.7 5.6 6.0 5.9 6.
Slide 32: Supporting Slides
SUPPORTING SLIDES
Slide 33: SFCF 26% Lower in Q4 Due to HC Price Normalization
SFCF 26% LOWER IN Q4 DUE TO HC PRICE NORMALIZATION Q-O-Q DROP DRIVEN BY SEASONALITY SIMPLIFIED FCF* (USD mn) 1,115 -26% -40% 640 108 519 517 386 328 357 262 199 174 134 139 20 62 48 67 33 -45 -63 -143 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 US DS CS GM C&O (incl. inters) 33 *Simplified Free
Slide 34: Working Interest Based Production Slightly Increased QoQ
WORKING INTEREST BASED PRODUCTION SLIGHTLY INCREASED QOQ QUARTERLY WORKING INTEREST PRODUCTION BY COUNTRY* (mboepd) 129.0 129.3 130.4 117.4 117.5 122.0 Associated 15.7 15.5 17.2 15.7 17.0 16.0 companies* Other 4.2 4.4 4.4 4.2 4.3 0.1 3.8 KRI 8.3 7.8 5.9 2.8 4.8 8.6 6.1 5.9 6.0 Pakistan 6.1 6.0 34.9
Slide 35: Upstream: Operational Update (1)
UPSTREAM: OPERATIONAL UPDATE (1) Hungary Croatia EXPLORATION EXPLORATION Two Shallow Gas wells were completed and tested with positive results Block DR-03: V. Rastovac-1 well Notice of commercial discovery submitted to Vecsés appraisal program continued; Vecsés-1 well was spudded in January the Croa
Slide 36: Upstream: Operational Update (2)
UPSTREAM: OPERATIONAL UPDATE (2) Pakistan Russia EXPLORATION 2023 well workover program continued with 9 workovers performed TAL block (Operated): Razgir-1 well was spudded in January Construction work program fully delivered: pipelines construction and reconstruction, powerline construction, partia
Slide 37: Upstream Capex by Region and by Type in 2023
UPSTREAM CAPEX BY REGION AND BY TYPE IN 2023 ORGANIC CAPEX BY REGION AND BY TYPE (USD mn) HUN CRO KRI PAK AZE OTHER Total – 2023 Total – 2022 EXP 23.6 11.6 0.0 (3.8) 0.7 0.5 32.5 47.1 DEV 57.0 45.2 11.7 1.2 138.7 14.6 268.4 287.8 Other 17.3 36.7 6.2 1.0 3.7 0.1 64.9 40.0 Total – 2023 97.9 93.4 17.9
Slide 38: Gas Midstream: Key Financials
GAS MIDSTREAM: KEY FINANCIALS EBITDA (USD mn) CAPEX (USD mn) -15% -29% 19 79 74 61 60 13 52 38 9 7 5 4 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 KEY FINANCIALS (USD mn) COMMENTS YoY YoY EBITDA fell by 15% YoY in Q4 2023 to USD 52mn. Q4 2023 Q4 20
Slide 39: Sustainability Indicators
SUSTAINABILITY INDICATORS CO2 under ETS (mn t) HC Spill above 1bbl (m3) Tier1 PSE +50% +13% 4 2.0 -47% 4 1.47 1.52 200 3 1.34 1.40 1.41 155.4 3 1.5 2 1.0 71.8 2 41.9 1 1 0.5 50 22.2 1 11.7 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q4 2022 Q1 2023 Q2 2023 Q3 2023
Slide 40: Macro Indicators
MACRO INDICATORS BRENT (USD/bbl) MOL REFINERY MARGIN* (USD/bbl) HUF/USD (Q avg.) 120 20 450 Brent-based MOL Group 100 15 400 Brent-based Complex 80 350 10 60 300 40 5 250 20 0 200 Q2 Q4 Q2 Q4 Q2 Q4 Q2 Q4 Q2 Q4 Q2 Q4 Q2 Q4 Q2 Q4 Q2 Q4 Q2 Q4 Q2 Q4 Q2 Q4 Q2 Q4 Q2 Q4 Q2 Q4 Q2 Q4 Q2 Q4 Q2 Q4 Q2 Q4 Q2 Q4
Slide 41: Consolidated Statement of Profit or Loss
CONSOLIDATED STATEMENT OF PROFIT OR LOSS Q3 2023 Q4 2022 YoY FY 2022 Q4 2023 Income Statement (HUF mn) FY 2023 Ch % restated restated Ch % restated 2,567,862 2,333,273 2,639,878 (12) Net sales 8,908,499 9,868,163 (10) (10,977) 18,914 23,141 (18) Other operating income 57,537 43,716 32 2,556,885 2,35
Slide 42: Consolidated Statement of Financial Position
CONSOLIDATED STATEMENT OF FINANCIAL POSITION 31 Dec 2022 31 Dec 2022 Balance Sheet (HUF mn) 31 Dec 2023 Ch % Balance Sheet (HUF mn) 31 Dec 2023 Ch % restated restated Assets Equity and Liabilities Non-current assets Equity Property, plant and equipment 3,997,801 3,817,879 5 Share capital 79,192 79,0
Slide 43: Consolidated Statement of Cash Flow
CONSOLIDATED STATEMENT OF CASH FLOW Q3 2023 Q4 2022 YoY FY 2022 Q4 2023 Cash Flow (HUF mn) FY 2023 Ch % restated restated Ch % restated 234,051 169,950 193,782 (12) Profit / (loss) before tax for continuing operation 691,418 1,155,294 (40) 1,426 (2,740) 92,661 n.a. Profit / (loss) before tax for dis
Slide 44: External Parameters
EXTERNAL PARAMETERS Q3 2023 Q4 2022 YoY FY 2022 Q4 2023 Macro figures (average) FY 2023 Ch % restated restated Ch % restated 86.7 84.3 88.9 (5) Brent dated (USD/bbl) 82.6 101.3 (18) 74.2 74.7 63.7 17 Ural Blend (USD/bbl)(11) 64.3 75.1 (14) (12.2) (9.8) (25.8) (62) Urals-Brent spread (USD/bbl) (19.2)