Saudi Arabian Oil Co. · TADAWUL:2222
Saudi Arabian Oil — Saudi Aramco — FY2019 Earnings Presentation
19 slides from Saudi Arabian Oil's earnings presentation, Mar 16, 2020
Slide 1: Saudi Aramco Full-Year 2019 Results
Saudi Aramco Full-Year 2019 Results March 16, 2020
Slide 2: Cautionary notes
Cautionary notes IMPORTANT: The following applies to this presentation and associated slides by Saudi Arabian Oil Company (the “Company”) (collectively, the “Information”). The Information contains forward-looking statements. All Information other than statements relating to historical or current fa
Slide 3: Amin Nasser, President & CEO
Amin Nasser President & CEO 3 Saudi Aramco: Confidential
Slide 4: Vision: to be the world's preeminent integrated energy & chemicals company
Vision: to be the world’s preeminent integrated energy & chemicals company, operating in a safe, sustainable & reliable manner Unrivalled reserves & production Low Upstream costs per barrel Leading reserves life Unparalleled through-cycle earnings Outperforms global champions Liquids, gas, chemicals
Slide 5: 2019: A landmark year
2019: A landmark year • Robust financial results • One of lowest Upstream carbon footprints1 • Record IPO and inaugural bond • New ESG2 disclosures demonstrate transparency • Strong safety performance • Agreement to acquire 70% equity • Operational resilience stake in SABIC3 • Independent third part
Slide 6: 2019 operational and financial performance
2019 operational and financial performance 13.2 9.9 10.1 5.54 0.016 524 mmboed1 mmbpd2 kg CO2e/boe scf/boe Lost time Patents Hydrocarbon Crude Upstream Flaring injury (LTI) granted production production carbon intensity4 rate5 FY 2018: 13.6 FY 2018: 10.3 intensity3 $88.2bn $32.8bn $78.3bn $73.2bn Ne
Slide 7: Khalid Al-Dabbagh, CFO
Khalid Al-Dabbagh CFO 7 Saudi Aramco: Confidential
Slide 8: Unrivalled financial performance
Unrivalled financial performance Net income Free cash flow2 $88.2bn $78.3bn Saudi Aramco IOC 51 Saudi Aramco IOC 51 ROACE2,3 Dividends & share buybacks 28.4% $73.2bn Saudi Aramco IOC 51 Saudi Aramco IOC 51 1. IOC 5 = International Oil Companies: BP, Chevron, ExxonMobil, Shell, Total. Data based on c
Slide 9: Unparalleled & resilient net income despite weaker environment
Unparalleled & resilient net income despite weaker environment 2019 versus 2018 ($ billion) • $5.4/bbl ↓ crude price • 0.4 mmbd ↓ 111.1 volumes • Weak margins • $1.6bn Sadara +9.8 88.2 impairment -28.4 -4.3 FY18 Net income Upstream EBIT Downstream EBIT Taxes & other FY19 Net income 9 Saudi Aramco: C
Slide 10: Sources and uses of cash
Sources and uses of cash Demonstrating financial strength FY 2018 FY 20192 ($ billion) ($ billion) 33 Capex 35 Capex 4 External investments1 Net cash flow from 121 Net cash operations 2 External investments1 flow from 111 operations 58 73 Dividends 58 Dividends Sources Uses Sources Uses 1. External
Slide 11: Capital discipline and flexibility: Revised guidance
Capital discipline and flexibility Revised guidance Total capex1 ($ billion) 40 $35-40bn • Dynamic capex review launched in response 35 to prevailing market environment 30 $25-30bn − 2020: $25-30bn range2 25 − 2021 and beyond: under review 20 15 • Low sustaining capex gives significant flexibility 1
Slide 12: Shareholder distributions: Downside resilience
Shareholder distributions Downside resilience ($ billion) 80 73 70 • Affordable base dividend 60 58 50 • Dividend priority for public shareholders 50 − Downside protection 40 30 • Track record of excess FCF1 distributions 20 10 0 2017 2018 2019 1. FCF = Free Cash Flow 12 Saudi Aramco: Confidential
Slide 13: Strength across cycles
Strength across cycles • 5-15% target gearing across the • Rigorous capital allocation • Affordable base dividend cycle1 process • Priority for public shareholders • Aaa standalone metrics through • Responsive to changing the cycle2 environment • Strong track record of free cash flow distribution 1.
Slide 14: Committed to value creation
Committed to value creation Strong financial performance Agile response to weaker market conditions Capital spending guidance lowered for 2020 Flexibility retained for further action $73bn dividends 14 Saudi Aramco: Confidential
Slide 15: Amin Nasser, President & CEO
Amin Nasser President & CEO 15 Saudi Aramco: Confidential
Slide 16: Sustainable free cash flow growth
Sustainable free cash flow growth • Potential for continued • Meet growing domestic • Enhancing performance volume growth demand − Asset optimization • Advantaged low cost, low • Commercial returns − SABIC integration carbon resource base • Significant unconventional − Expanding global trading resou
Slide 17: Environmental, Social & Governance
Environmental, Social & Governance Upstream Carbon Intensity Occupational Health & Safety 10.1 kg CO2e/boe1 • TRCF2 0.059 per 200,000 man-hours 1% • LTI3 rate 0.016 per 200,000 man-hours FY 2018: 10.2 kg CO2e/boe Scope 1 & 2 GHG Emissions Diversity & Inclusion 57.9 million tons CO2e1 • Ongoing inves
Slide 18: Governance: alignment with shareholders, Management KPI scorecard
Governance: alignment with shareholders Management KPI1 scorecard Value creation Operational efficiency HSSE MMBDoe % (Injuries/200k w-hrs) PSE/MMHrs % $bn Upstream Reserve Total Recordable Process Safety ROACE Net Income Production Replacement Ratio Case Frequency Events rate – Tier 1 ȼ/UEDC2 $/boe
Slide 19: Thank you
Thank you 19 Saudi Aramco: Confidential