Galp Energia, Sgps S.a. Class B · EURONEXT:GALP
Galp Energia, Sgps S.a. Class B — Galp Energia — Q3 2011 Earnings Presentation
24 slides from Galp Energia, Sgps S.a. Class B's earnings presentation, Oct 28, 2011
Slide 1: Results: Nine Months and Third Quarter 2011
28 October 2011 Results NINE MONTHS AND THIRD QUARTER 2011 Delivering growth through exploration and production
Slide 2: Agenda
Key highlights Business overview Strategy execution update Final remarks Appendix 2 Nine Months and Third Quarter 2011 results
Slide 3: Key highlights
Key highlights ▪ Net profit in 3Q11 reached €61 Mln ▪ Sines refinery steady production post-upgrade in 2Q12 ▪ Lula/Cernambi development plan being executed ▪ Drilling activity focused on high potential projects ▪ Ensuring a solid and trustable capital structure 3 Nine Months and Third Quarter 2011 r
Slide 4: Business overview
Key highlights Business overview Strategy execution update Final remarks Appendix 4 Nine Months and Third Quarter 2011 results
Slide 5: Net profit reached €61 Mln in 3Q11
Net profit reached €61 Mln in 3Q11 Profit & Loss (€Mln) 3Q11 3Q10 YoY QoQ 9M11 YoY ▪ G&P solid performance driven by higher supply Turnover 4,277 3,590 +19% (2%) 12,429 +19% margins EBITDA 221 223 (1%) (4%) 585 (14%) E&P 63 37 +69% (16%) 186 +43% ▪ R&M earnings still R&M 74 126 (41%) (22%) 191 (41%)
Slide 6: Net debt increase driven by transformational capex execution
Net debt increase driven by transformational capex execution Balance sheet (€Mln) Sep.2011 Jun.2011 Sep - Jun Dec.2010 Sep - Dec ▪ Capex decelerating with refining upgrade project Fixed assets 5,884 5,782 +103 5,426 +458 coming to its end Work in progress 2,494 2,350 +144 1,981 +513 Strategic stock
Slide 7: Short term outlook
Short term outlook ▪ 4Q11 working interest production targeted at c.23 kbopd ▪ Refining margin to be positively impacted by Matosinhos refinery upgrade ▪ Marketing volumes down QoQ, still impacted by the Iberian macro economic environment ▪ Natural gas volumes to increase QoQ supported by seasonalit
Slide 8: Strategy execution update
Key highlights Business overview Strategy execution update Final remarks Appendix 8 Nine Months and Third Quarter 2011 results
Slide 9: Ensuring a solid and trustable capital structure
Ensuring a solid and trustable capital structure Brazilian portfolio Key highlights • Using E&P Brazil for potential minimum cash in of c.€2 Bln • Assets captured companies interest worldwide • Binding offers already received • Negotiations ongoing with short list of bidders 1 Source: DeGolyer and M
Slide 10: Sines refinery steady post-upgrade production in 2Q12
Sines refinery steady post-upgrade production in 2Q12 4Q11 1Q12 2Q12 + Matosinhos up and New Sines refinery Steady production running since June and units start-up Fully integrated refining currently producing VGO Commissioning new units system 95% of capex already VGO produced in Po
Slide 11: In the right track to portfolio diversification
In the right track to portfolio diversification Mozambique – Rovuma basin • First exploration well confirms Rovuma as a world class province • Mamba South estimated natural gas in place up to 22.5 Tcf • Next well to be drilled this year in Mamba North, part of a larger appraisal program • Rovuma bas
Slide 12: Drilling activity will continue focusing on high potential projects
Drilling activity will continue focusing on high potential projects Potiguar basin BM-S-8 First exploration well scheduled for 4Q11 Drilling in 4Q11 targeting two prospects Iara area BM-S-24 Iara W in 4Q11 to better understand reservoir Appraisal well in Júpiter rescheduled for 2012 12 Nine Months a
Slide 13: Lula/Cernambi development plan being executed
Lula/Cernambi development plan being executed Lula-1 project cumulative producing wells1 #4 #3 Flow rate of 28 kbbl/d #2 since May with gas injection well #1 Jan. 2011 Nov. 2011 Dec. 2011 Feb. 2012 Lula production ramping up reaching c.80 kbbl/d by YE2011 1 FPSO Cidade de Angra dos Reis with capacit
Slide 14: Final remarks
Key highlights Business overview Strategy execution update Final remarks Appendix 14 Nine Months and Third Quarter 2011 results
Slide 15: Final remarks
Final remarks ▪ Forthcoming Brazilian transaction announcement ▪ Upgrade project capex reaching the end contributing to incremental cash flow generation ▪ De-risking of resources ongoing in crucial areas ▪ Development of Lula/Cernambi ahead of expectations anticipating cash flow generation 15 Nine M
Slide 16: Save the date: Capital Markets Day 2012
SAVE THE DATE Galp Energia Capital Markets Day 2012 London March 6th 2012 16 Nine Months and Third Quarter 2011 results
Slide 17: Appendix
Key highlights Business overview Strategy execution update Final remarks Appendix 17 Nine Months and Third Quarter 2011 results
Slide 18: Brazil gaining relevance within business segment
Brazil gaining relevance within business segment Main E&P data 3Q11 3Q10 YoY QoQ 9M11 YoY ▪ Lula field drove working interest production growth Working interest production kbbl/d 20.8 19.6 +6% (5%) 20.6 +7% Net entitlement production kbbl/d 12.2 9.5 +28% (11%) 11.9 +8% Angola kbbl/d 8.0 8.1 (1%) (20
Slide 19: R&M EBITDA impacted by the refining business
R&M EBITDA impacted by the refining business Main R&M data ▪ Refining margin followed 3Q11 3Q10 YoY QoQ 9M11 YoY negative trend of Galp Energia refining margin $/bbl 0.9 2.1 (60%) +37% 0.8 (70%) international markets Spread over benchmark $/bbl 1.3 1.6 (19%) (30%) 1.6 (1%) Crude processed M bbl 20.7
Slide 20: EBITDA improved YoY supported by supply business
EBITDA improved YoY supported by supply business Main G&P data 3Q11 3Q10 YoY QoQ 9M11 YoY ▪ Supply margin increase supported by optimization NG supply total sales volumes M m3 1,159 1,302 (11%) (2%) 3,951 +10% Electrical M m3 490 613 (20%) +1% 1,479 +0% of natural gas purchases Industrial M m3 480 4
Slide 21: Capex evolution signing final stage of upgrade project
Capex evolution signing final stage of upgrade project Capital expenditure (€Mln) G&P ▪ Development activities R&M in Brazil responsible for E&P most of E&P capex 864 808 ▪ Upgrade refining project accounting for c.80% of R&M capex 278 218 ▪ G&P capex channelled to natural gas distribution network 9
Slide 22: Additional facilities of €0.91 Bln
Additional facilities of €0.91 Bln M/L-term debt reimbursement profile (€Mln) 1.000 ▪ Major debt reimbursement scheduled for 2012-14 800 period 600 400 200 ▪ Total net debt of €3.4 Bln, with an average life of 2.3 0 2011 2012 2013 2014 +2015 years Debt structure as of September 2011 ▪ Average intere
Slide 23: Disclaimer
Disclaimer RCA figures except otherwise noted. Matters discussed in this presentation may constitute forward-looking statements. Forward-looking statements are statements other than in respect of historical facts. The words “believe,” “expect,” “anticipate,” “intends,” “estimate,” “will,” “may,” "co
Slide 24: Investor Relations team
Investor Relations team Tiago Villas-Boas, Head of IR Cátia Lopes Inês Santos Maria Borrega Pedro Pinto Samuel Dias +351 21 724 08 66 investor.relations@galpenergia.com www.galpenergia.com Results & presentation weblink www.galpenergia.com/en/investidor/Relatori os-e-resultados/resultados-trimestrai