OMV AG · VIE:OMV
OMV — OMV Aktiengesellschaft — 17th German Corporate Conference 2018
32 slides from OMV's conference presentation, Jan 16, 2018
Slide 1: 17th German Corporate Conference
17th German Corporate Conference Reinhard Florey Chief Financial Officer Frankfurt, January 16, 2018 Value creation through performance OMV Aktiengesellschaft
Slide 2: Disclaimer
Disclaimer This report contains forward-looking statements. Forward-looking statements usually may be identified by the use of terms such as “outlook,” “believe,” “expect,” “anticipate,” “intend,” “plan,” “target,” “objective,” “estimate,” “goal,” “may,” “will” and similar terms, or by their context
Slide 3: OMV – an international, integrated oil and gas company
OMV – an international, integrated oil and gas company Upstream ► Four core regions: CEE, Norway, Middle East and Africa, Russia ► Production 2016: 311 kboe/d (~50% oil, ~50% gas) ► 1P reserves at year-end: 1.03 bn boe (reserves life of ~9 years) ► ~90% of production in EU and OECD countries Downstr
Slide 4: OMV delivers on strategy
OMV delivers on strategy € € PORTFOLIO COST DISCIPLINE STRONG DIVIDEND RESHAPING CASH FLOW Acquisition of Upstream production cost Free cash flow break-even Dividend Per Yuzhno Russkoye closed below USD 9/boe 1 decreased to 35 USD/bbl in Share of 2016 EUR 1.20 for Signed asset swap with Gazprom Cost
Slide 5: Strategic steps towards building sustainable Upstream portfolio
Strategic steps towards building sustainable Upstream portfolio Divestments Acquisitions Scaled down exposure in Closed acquisition of 24.99% in high-cost regions (e.g. UK Yuzhno Russkoye gas field Upstream) Signed binding asset swap Reduced exploration agreement with Gazprom activities and
Slide 6: Optimized Downstream portfolio
Optimized Downstream portfolio Gas sales business Gas transportation business Acquired, restructured and Signed financing agreements integrated gas sales and trading for Nord Stream 2 businesses (renamed OMV Gas Reduced exposure in regulated Marketing & Trading) Gas business by selling 49% S
Slide 7: Balanced portfolio results in strong and resilient cash generation
Balanced portfolio results in strong and resilient cash generation Cash generation Sources of funds in EUR bn 3.6 3.5 >3bn 3.3 3.2 3.0 EUR Downstream Upstream Other (0.3) 0.0 (0.1) (0.2) (0.3) 2012 2013 2014 2015 2016 Brent 112 109 99 52 44 in USD/bbl 7 | OMV Group, 17th German Corporate Conference,
Slide 8: Financial resilience: oil price free cash flow break-even lowered
Financial resilience: oil price free cash flow break-even lowered Brent oil price free cash flow 1 break-even OMV Group, in USD/bbl Free cash flow break-even decreased to 35 USD/bbl (50)% Significant reductions in CAPEX, cost and stringent focus on cash generation ~70 Free cash flow after divide
Slide 9: Very strong performance in 2017
Very strong performance in 2017 Clean CCS Operating Result Clean CCS net income Clean CCS earnings per Share in EUR mn attributable to stockholders in EUR in EUR mn 2,270 3.85 1,257 3.52 1,148 1,737 880 Upsteam 3.05 995 1,535 1,414 Downstream 2015 2016 9m/17 2015 2016 9m/17 2015 2016 9m/17 Downstrea
Slide 10: Free cash flow after dividends of EUR 2.5 bn
Free cash flow after dividends of EUR 2.5 bn Organic free cash flow1 of EUR 1 bn Sources and uses 2 of cash in 9m/17 9m/17 in EUR bn Strong cash flow form operating activities of EUR 2.7 bn 9m/17 (Q3/17: EUR 0.8 bn) 4.2 Proceeds from divestments of EUR 1.8 bn (Q3/17: EUR 75 mn) 1.5 Free cash 2.5
Slide 11: Strict cost discipline
Strict cost discipline Upstream production cost 1 CAPEX 2 Cost-savings program 3 in USD/boe in EUR bn in EUR mn +50 (33)% -33% ~(39)% -39% +50 13.2 2.8 >250 10.6 200 8.8 1.9 ~1.7 ~0.6 1.1 9m 2015 2016 9m/17 2015 2016 2017 2015 2016 2017 Target 1 Starting with 2016, administrative expenses and sellin
Slide 12: New dividend policy
New dividend policy Dividend per share in EUR We are committed to delivering an attractive and predictable shareholder return through the 1.25 1.25 business cycle 1.20 1.20 1.10 1.00 1.00 Floor dividend of EUR 1 per share projected, provided that this will not be to the detriment of the Company’
Slide 13: Financial steering framework of OMV
Financial steering framework of OMV Shareholder return and stable rating Value + Cash Free Cash Flow ROACE / EVA KPI Gearing Clean CCS net income / NOPAT Strength of balance sheet and Growth in profitability and Focus Steady value enhancement Adequate liquidity Operational efficiency Capital efficie
Slide 14: We are the energy – for a better life
OMV Vision 2020 We are the energy – for a better life Restructuring Value added growth Streamlined portfolio Upstream Integrated gas sales and Growing in low-cost regions with rich hydrocarbon trading businesses reserves OMV Achieved > EUR 200 mn Optimize operating assets in 2020 cost sa
Slide 15: OMV Aktiengesellschaft
OuvV OMV OMV Aktiengesellschaft ouv The energy for a better tite. OMV
Slide 16: BACK-UP
BACK-UP OMV Aktiengesellschaft
Slide 17: More favorable macro environment - significant uplift of refining margins
More favorable macro environment - in particular a significant uplift of refining margins Oil price Brent OMV indicator refining margin in USD/bbl in USD/bbl 60 52 8 7.0 50 54 49 50 6 40 46 6.0 5.6 5.4 30 4 20 3.7 2 10 0 0 Q3/16 Q4/16 Q1/17 Q2/17 Q3/17 Q3/16 Q4/16 Q1/17 Q2/17 Q3/17 Gas prices Ethyle
Slide 18: Significant deleveraging and strong cash position
Significant deleveraging and strong cash position Net Debt development Strong liquidity position as of Q3 2017 in EUR bn Further reduction of net debt to EUR 0.4 bn 4.0 Cash position at EUR 4.6 bn 3.0 Committed revolving credit facilities of EUR 3.5 bn (undrawn) 1.7 0.9 Target long-term gear
Slide 19: Credit ratings
Credit ratings Commitment to strong investment grade credit profile enhances the Group’s high level of transparency with investors June 12, 2017 May 8, 2017 Senior unsecured: Baa1, outlook stable Senior unsecured: A-, outlook stable 19 | OMV Group, 17th German Corporate Conference, Frankfurt, Januar
Slide 20: Funding activities of the last years
Funding activities of the last years Date of issue Bond Amount Coupon Maturity November 2014 Eurobond (XS1138423774) EUR 750,000,000 0.60% fix 11/19/2018 November 2013 Eurobond (XS0996734868) EUR 500,000,000 1.75% fix 11/25/2019 February 2010 Eurobond (XS0485316102) EUR 500,000,000 4.375% fix 02/10/
Slide 21: Targeting a long-term gearing ratio of ≤30%
Targeting a long-term gearing ratio of ≤30% Debt maturity profile 1 Debt EUR 5.09 bn in EUR mn Gearing 1,200 Cash EUR 4.64 bn ratio 3% Net debt 2 EUR 0.45 bn 1,000 Debt breakdown 800 Variable: 18% USD: 5% 600 400 200 EUR: 95% 0 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027ff Fixed: 82% Seni
Slide 22: Major achievements in reshaping OMV's portfolio
Major achievements in reshaping OMV’s portfolio Sale of 30% in Sale of a 49% Sale of Divestment of Divested OMV Sale of Ashtart Rosebank; stake in Gas Aliaga OMV UK Petrol Ofisi – net field in Tunisia USD 50 mn Connect Austria; terminal in Upstream cash contribution received in Q4/16 EUR 0.6 bn Turk
Slide 23: Asset swap between Gazprom and OMV is progressing well
Asset swap between Gazprom and OMV is progressing well Project status Signing of final transaction expected by mid-2017 Closing expected by end of 2018 Investments 40% of total EUR 900 million CAPEX to be invested for 2017 and 2018 after closing Leverage on already built infrastructure and
Slide 24: Yuzhno Russkoye: among the largest gas fields in Russia
Yuzhno Russkoye: among the largest gas fields in Russia ► On December 1, 2017, OMV closed the acquisition of a 24.99% participation in the Yuzhno Russkoye natural gas field from Uniper SE ► The purchase price amounted to EUR 1,719 mn including customary closing adjustments ► The economic effective d
Slide 25: Yuzhno Russkoye: an attractive acquisition for OMV
Yuzhno Russkoye: an attractive acquisition for OMV Yuzhno Russkoye versus 2P reserve acquisition multiples in recent Russian asset deals 4.0 Acquisition price, USD//boe of 3.5 3.0 2.5 2.0 2P 1.5 1.0 0.5 0.0 BP - 20% of Taas-Yuryakh ONGC - 15% of Vankor Silk Road Fund - 9.9% of Yamal Oil India, India
Slide 26: Russia: OMV's new core Upstream regions
Russia: OMV’s new core Upstream regions OMV production contribution from Russian fields 1 in kboe/d 200 150 100 50 0 2017 2 2018 2019 2020 2021 2022 2023 2024 2025 2026 Urengoy, Russia. Source: Gazprom Achimov IV/V Yuzhno Russkoye Stable production flow for a very long period of time Production
Slide 27: OMV keeps a risk balanced portfolio
OMV keeps a risk balanced portfolio Size of Russian assets in OMV Group’s average Gazprom – reliable local partner capital employed 1 2016 basis, in EUR bn Business experience of OMV‘s CEO with Gazprom extends over a decade 20 ~15% Yuzhno Russkoye field has consistently produced above plan 15
Slide 28: OMV in Libya: Operations restarted
OMV in Libya: Operations restarted OMV operations in Libya OMV restarted production in Murzuq and Sirte basins in 2016 Expansion of capacity OMV increased stake in four Exploration and Production Sharing Agreements in the Sirte Basin (C103, NC29/74, C102 and Nafoora Augila) OMV now holds 10% i
Slide 29: Nord Stream 2: Improvement of energy security in Europe
Nord Stream 2: Improvement of energy security in Europe Nord Stream 2 pipeline ► 1,220 km long sub-sea gas pipeline from Russia to Germany Nord Stream 2 ► Total project costs of EUR 9.5 bn ► Development starts in 2018 and is planned to finish by 2019 ► Gazprom 100% owner of Nord Stream 2 AG Baumgart
Slide 30: OMV Petrol Ofisi divestment closed
OMV Petrol Ofisi divestment closed ► Closed divestment of OMV Petrol Ofisi to Vitol Group on June 13, 2017 ► Overall transaction value of EUR 1.4 bn ► Important step in the implementation of OMV’s corporate strategy 30 | OMV Group, 17th German Corporate Conference, Frankfurt, January 16, 2018
Slide 31: Impact of OMV Petrol Ofisi sale in OMV Downstream Oil financials
Impact of OMV Petrol Ofisi sale in OMV Downstream Oil financials 2016 2016 Impact of OMV OMV Downstream OMV Downstream Oil Petrol Ofisi sale Oil excl. OMV Petrol Ofisi Total refined product sales (mn tons) 30.7 20.1 (35)% thereof retail sales (mn tons) 10.4 6.0 (42)% Number of filling stations 3,777
Slide 32: Sensitivities of OMV Group in 2017
Sensitivities of OMV Group in 2017 FY 2017 impact Operating Result 1 Operating cash flow in EUR mn Brent oil price +45 +40 (USD +1/bbl) Gas price (EUR +1/MWh)2 +20 +15 OMV indicator refining margin +110 +85 (USD +1/bbl) Petrochemicals margin (EUR +10/t)3 +15 +10 EUR-USD +170 +130 (USD appreciates by
OMV Aktiengesellschaft — 17th German Corporate Conference 2018 on 6ix