Mol Hungarian Oil & Gas Plc Class A · BET:MOL
Mol Hungarian Oil & Gas Plc Class A — MOL Group — Q3 2022 Earnings Presentation
41 slides from Mol Hungarian Oil & Gas Plc Class A's earnings presentation, Nov 4, 2022
Slide 1: Third Quarter 2022 Results
THIRD QUARTER 2022 RESULTS 4 NOVEMBER 2022
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, CAPIT
Slide 3: Highlights of the Quarter
HIGHLIGHTS OF THE QUARTER
Slide 4: Q1-Q3 2022: Financial Performance Affected by Fuel Price Regulation and Windfall Taxes
Q1-Q3 2022: FINANCIAL PERFORMANCE AFFECTED BY FUEL PRICE REGULATION AND WINDFALL TAXES 2021 Q1-Q3 2022 2022 RESULTS5 RESULTS4 GUIDANCE GROUP CLEAN CCS EBITDA USD 3.53 BN USD 3.63 BN USD 4.1-4.4 BN GROUP CAPEX (ORGANIC) USD 1.54 BN USD 962 MN UP TO USD 1.7 BN SIMPLIFIED FCF1 USD 1.98 BN USD 2.67 BN A
Slide 5: USD 3.6bn YTD EBITDA Delivery Despite Regulatory Headwinds
USD 3.6BN YTD EBITDA DELIVERY DESPITE REGULATORY HEADWINDS SUPPORTED MAINLY BY UPSTREAM AND REFINING CONTRIBUTION FINANCIALS Clean CCS EBITDA of continuing operations amounted to USD 1,449mn in Q3 2022 and USD 3,627mn in Q1-Q3 2022, however a USD 2.0bn working capital build weighted on CF generation
Slide 6: TRIR Above Tolerable Limit Due to Slip/Trip Events
TRIR ABOVE TOLERABLE LIMIT DUE TO SLIP/TRIP EVENTS SPECIFIC INJURY PREVENTION ACTION PLANS INTRODUCED TOTAL RECOVERABLE INJURY RATE (TRIR) Tolerable limit for 2022 (1.2) Comparing the occupational safety performance of Q3 2022 to the same 2,0 1,92 period of 2021, MOL Group experienced a significant
Slide 7: Key Group Quarterly Financials
KEY GROUP QUARTERLY FINANCIALS
Slide 8: Strong Results from All Businesses Drove EBITDA Uplift QoQ
STRONG RESULTS FROM ALL BUSINESSES DROVE EBITDA UPLIFT QOQ EX-UK CLEAN CCS EBITDA REACHED USD 1.45BN IN Q3 2022 AND USD 3.63BN YTD SEGMENT CLEAN CCS EBITDA* (USD mn) COMMENTS +52% +8% Upstream 1,345 1,449 Q3 2022 EBITDA grew further as improving gas price realization off-set the negative impact of e
Slide 9: Organic Spending Reached USD 962mn in Q1-Q3 2022
ORGANIC SPENDING REACHED USD 962MN IN Q1-Q3 2022 IN LINE WITH BASE PERIOD SPENDING TOTAL GROUP CAPEX* (USD mn) TOTAL GROUP CAPEX* (USD mn) -6% 0% -6% 0% 568 568 29 359 354 359 354 10 1 331 334 334 1 331 334 334 447 8 29 86 29 71 85 299 286 224 278 150 256 152 159 37 21 39 36 9 37 92 100 59 6 45 51 6
Slide 10: MOL Generated Over USD 2.6bn Simplified FCF in Q1-Q3 2022
MOL GENERATED OVER USD 2.6BN SIMPLIFIED FCF IN Q1-Q3 2022 WITH US AND DS BOTH CONTRIBUTING THEIR FAIR SHARE TO SIMPLIFIED FCF SIMPLIFIED FCF* (USD mn) +86% +7% 1,040 1,115 505 555 601 488 240 510 350 583 286 709 174 7 84 9 9 29 -108 -190 -136 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Discontin
Slide 11: Net Income Reached USD 1,771mn
NET INCOME REACHED USD 1,771MN AMOUNTING TO HUF 962 EARNINGS PER SHARE IN Q1-Q3 2022 Q1-Q3 2022 EARNINGS* (USD mn) – BELOW THE EBITDA LINE ITEMS 3,627 Consumer Services 231 1 0 810 Total Profit for the period to Downstream 1,856 232 30 2,137 equity holders of the parent 611 Discontinued 366 3,628 23
Slide 12: Rising Financial Expenses in Line with Weakening HUF
RISING FINANCIAL EXPENSES IN LINE WITH WEAKENING HUF HIGHER INCOME TAX EXPENSES MOSTLY IN LINE WITH IMPROVING PROFITABILITY CCS effect, gain, loss (USD mn, cont.op.) Comments +47% -39% -99% Minor CCS impact in Q1-Q3 2022 as the impact of oil -15 -22 123 price uplift driven replacement modification i
Slide 13: Operating Cash Flow Before WC at USD 4.0bn in Q1-Q3 2022
OPERATING CASH FLOW BEFORE WC AT USD 4.0BN IN Q1-Q3 2022 LARGELY OFFSET BY MACRO DRIVEN WORKING CAPITAL BUILD OPERATING CASH FLOW FOR TOTAL OPERATION IN Q1-Q3 2022 (USD mn) 4,007 523 264 USD 376mn build in Q3 2022 760 2,988 2,030 Discontinued 372 USD 1,403mn increase in Q3 USD 1,028mn increase in Q3
Slide 14: Net Debt to EBITDA Remains in the Comfort Zone
NET DEBT TO EBITDA REMAINS IN THE COMFORT ZONE AS DIVIDEND PAYMENT, WORKING CAPITAL BUILD PARTLY OFFSET STRONG OPERATING CF 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 18.3 18.9 17.5 16.0 0.97 14.3 1.0 15 13.6 0.79 0.82 12.0 0.74 0.65 0.65 0.69 10 0.5 0.4
Slide 15: Downstream Q3 2022 Results
DOWNSTREAM Q3 2022 RESULTS
Slide 16: Somewhat Lower Downstream Contribution QoQ in Q3 2022
SOMEWHAT LOWER DOWNSTREAM CONTRIBUTION QOQ IN Q3 2022 TOTAL CLEAN CCS EBITDA AMOUNTED TO USD 741MN IN Q3 2022 QUARTERLY CLEAN CCS EBITDA (USD mn) TOTAL PRODUCT SALES (kt) Petchem R&M +70% -14% Total petrochemicals products 3rd party sales Own production 861 -2% +7% 84 741 5,251 5,161 20 4,836 4,728
Slide 17: Receding Refining and Petchem Margins QoQ in Q3
RECEDING REFINING AND PETCHEM MARGINS QOQ IN Q3 PRICE REGULATION, WINDFALL TAXES STILL PLAY A MAJOR ROLE REFINING MARGIN (USD/bbl) COMMENTS (Ex-Ural) refining margins retreated from Q2 2022 highs while motor fuel +265% cracks moderated and the energy bill continued to rise 20 Brent-based MOL Group r
Slide 18: Very Strong DS Contribution Both in Q3 and 2022 YTD
VERY STRONG DS CONTRIBUTION BOTH IN Q3 AND 2022 YTD HUNGARIAN PRICE REGULATION, WINDFALL TAX HIT PROFITABILITY BY AROUND USD 340MN IN Q3 DOWNSTREAM CLEAN CCS EBITDA YoY, Q3 2022 VS. Q3 2021 (USD mn) COMMENTS 125 741 R&M price impact: mainly supported by the Ural 55 5 716 differential (net of B/U tax
Slide 19: Consumer Services Q3 2022 Results
CONSUMER SERVICES Q3 2022 RESULTS
Slide 20: Sequential EBITDA Improvement in Q3 2022
SEQUENTIAL EBITDA IMPROVEMENT IN Q3 2022 BUT FUEL PRICE REGULATION REMAINS A MAJOR DRIVER QUARTERLY EBITDA (USD mn) EBITDA YoY, Q3 2022 VS. Q3 2021 (USD mn) -43% 162% -32% Retail 211 tax 64 20 11 143 14 22 121 211 -25 164 116 121 64 46 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 EBITDA Q3 2021 F
Slide 21: Q3 2022 Fuel Sales Volume Increased by 11%
Q3 2022 FUEL SALES VOLUME INCREASED BY 11% AVERAGE QUARTERLY THROUGHPUT EXCEEDED 1MN LTR/SITE IN Q3 2022 TOTAL VOLUMES SOLD (mn litres) FUEL THROUGHPUT/SITE1 (mn litres) 9% 11% 12% 1.01 1,916 0.92 0.93 0.88 0.85 1,727 1,705 4Y CAGR: 1,473 1,452 1,465 +3.67% Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3
Slide 22: Non-Fuel Margin Expanded by 21% YoY in Q3 2022
NON-FUEL MARGIN EXPANDED BY 21% YOY IN Q3 2022 WHILE THE NON-FUEL MARGIN SHARE TO THE TOTAL MARGIN REMAINED CLOSE TO 40% NON-FUEL MARGIN (USD MN – CONST. FX) TOTAL NON-FUEL TURNOVER (USD MN – CONST. FX) +21% +21% +10% +14% 117.3 432.2 392.0 380.4 97.0 96.6 343.6 332.6 329.4 79.2 80.5 74.0 Q2 2021 Q3
Slide 23: Hungarian Regulatory Measures Resulted in USD -8mn FCF Loss
HUNGARIAN REGULATORY MEASURES RESULTED IN USD -8MN FCF LOSS REGULATION CHANGE TRIGGERED POSITIVE Q3 EBITDA GENERATION COMPENSATING LOSSES ACCUMULATED IN Q2 QUARTERLY EBITDA (USD mn) EBITDA YTD, Q1-Q3 2022 VS. Q1-Q3 2021 (USD mn) -64% -92% 66 15 26 47 38 28 120 19 17 7 15 17 3 9 7 Q2 2021 Q3 2021 Q4
Slide 24: Upstream Q3 2022 Results
UPSTREAM Q3 2022 RESULTS
Slide 25: E&P EBITDA Reached USD 640mn in Q3 2022
E&P EBITDA REACHED USD 640MN IN Q3 2022 SUPPORTED BY RECORD HIGH GAS PRICES QUARTERLY EBITDA* (ex-spec) (USD mn) OIL PRICES* +97% +11% 134.0 140 113.8 120 101.4 100.9 107.5 100 79.7 73.5 93.6 103.9 640 80 68.8 76.0 94.5 97.1 576 61.1 69.0 455 504 60 64.3 62.7 81.8 325 43.0 44.2 57.0 53.3 282 29.2 42
Slide 26: Unit Free Cash Flow Close to USD/bbl in Q3 2022
UNIT FREE CASH FLOW CLOSE TO 70 USD/BBL IN Q3 2022 QUARTERLY PRICE REALIZATION, EBITDA, FCF *(USD/boe) 140 134 120 114 Realized HC price 101 100 108 82 101 Brent price 80 73 80 93 80 69 72 Unit EBITDA 60 63 63 53 54 40 40 34 62 68 52 Unit FCF** 20 40 22 29 0 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q
Slide 27: Higher Oil and Gas Prices Positively Impacted Q3 2022 Results
HIGHER OIL AND GAS PRICES POSITIVELY IMPACTED Q3 2022 RESULTS UPSTREAM EBITDA QoQ, Q3 2022 VS. Q2 2022 (USD mn) COMMENTS 683 689 643 640 +49 Gas prices reached all time highs in Q3 -107 587 +19 -1 -4 -3 -3 576 +46 +11 Off-setting the 12 USD/bbl decrease in Brent prices and the extra royalty Extra ro
Slide 28: Production Above 90 mboepd in Q3 2022
PRODUCTION ABOVE 90 MBOEPD IN Q3 2022 WHILE YTD DELIVERY STOOD AT 92.3 MBOEPD EXCEEDING THE (EX-UK) ANNUAL 90 KBOEPD PRODUCTION GUIDANCE PRODUCTION BY COUNTRY* (mboepd) COMMENTS Q3 2022 QoQ (vs. Q2 2022): 98.3 CEE: +0.4 mboepd improved in line with higher gas production Associated 94.1 93.5 94.1 sup
Slide 29: Group Level Unit Opex Remains Below USD 5/bbl in Q3 2022
GROUP LEVEL UNIT OPEX REMAINS BELOW 5 USD/BBL IN Q3 2022 UK DIVESTMENT IMPACTS UNIT LIFTING COSTS FAVOURABLY UNIT OPEX (USD/boe) COMMENTS +1% 7.3 Group unit OPEX (of continuing operations) remained flat at 4.9 USD/boe 7.5 6.9 QoQ despite significant cost pressure across the value chain YoY in Q3 7.0
Slide 30: Supporting Slides
SUPPORTING SLIDES
Slide 31: Working Interest Based Production Remained Slightly Lower QoQ in Q3 2022
WORKING INTEREST BASED PRODUCTION REMAINED SLIGHTLY LOWER QOQ IN Q3 2022 QUARTERLY WORKING INTEREST PRODUCTION BY COUNTRY* (mboepd) 135.4 134.0 133.7 132.0 130.0 129.0 Associated companies* 15.5 15.4 15.4 16.2 15.5 15.7 Other 4.6 4.4 4.1 4.2 4.2 4.2 KRI 8.1 7.7 8.4 8.4 8.2 8.3 Pakistan 6.8 6.9 6.7 6
Slide 32: Upstream: Operational Update (1)
UPSTREAM: OPERATIONAL UPDATE (1) Hungary Croatia EXPLORATION Vecsés-2 well was spudded in July, and drilled in August. Triassic limestones EXPLORATION were drilled with promising first results. The well-test is ongoing. Block SZH-01: Attribute analysis, Geochronological study, and economic Preparati
Slide 33: Upstream: Operational Update (2)
UPSTREAM: OPERATIONAL UPDATE (2) Kurdistan Region of Iraq United Kingdom MOL signed an agreement with Waldorf Production Limited (“Waldorf”) SHAIKAN QoQ production decreased mainly due to the SH-8 well being out of covering the sale of its entire Upstream portfolio in the United Kingdom on productio
Slide 34: Upstream Capex by Region and by Type
UPSTREAM CAPEX BY REGION AND BY TYPE ORGANIC CAPEX BY REGION AND BY TYPE* (USD mn) HUN CRO KRI PAK NOR AZE OTHER Total – Q1-Q3 2022 Total – Q1-Q3 2021 EXP 8.2 3.4 0.0 8.3 0.5 0.0 0.2 20.7 65.5 DEV 21.5 42.5 9.3 1.7 0.7 113.2 9.8 198.7 185.2 Other 6.1 9.8 2.5 0.4 0.0 2 0.0 20.8 28 Total – Q1-Q3 2022
Slide 35: Gas Midstream: Key Financials
GAS MIDSTREAM: KEY FINANCIALS EBITDA (USD mn) CAPEX (USD mn) +25% +154% 26 48 -57% +50% 21 38 19 34 30 23 9 15 6 2 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 KEY FINANCIALS (USD mn) COMMENTS YoY YoY Q3 2022 Q3 2021 Q1-Q3 2022 Q1-Q3 2021 EBITDA ros
Slide 36: Sustainability Indicators
SUSTAINABILITY INDICATORS CO2 under ETS (mn t) HC Spill above 1bbl (m3) Tier1 PSE 0% +10% +37% -99% +100% -20% 2.0 916.8 6 5.0 1.47 1.54 1.49 1.54 1000 1.5 1.40 1.40 4.0 4.0 4 1.0 500 2.0 2.0 2.0 2 0.5 11.4 4.4 51.1 5.6 6.0 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q2 2021 Q3 2021 Q4 2021 Q1 2
Slide 37: 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 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3
Slide 38: Consolidated Statement of Profit or Loss
CONSOLIDATED STATEMENT OF PROFIT OR LOSS 38
Slide 39: Consolidated Statement of Financial Position
CONSOLIDATED STATEMENT OF FINANCIAL POSITION 39
Slide 40: Consolidated Statement of Cash Flow
CONSOLIDATED STATEMENT OF CASH FLOW 40
Slide 41: External Parameters
EXTERNAL PARAMETERS Q2 2022. @32022 @3 2021 che Macro figures (average) Q1-Q3 2022 QI-Q3 2021 Ch % 13,9 1008 735, 37_Brent dated (USD/b51) 1055 679) 55. 776 7S. 706 1__Urai Blend (USD/bbi)” 789 658. 20 (34a) (272) 3) no. _|Urat-Brent spread (USD/bb)) (246) i) na. 1002) 208 4%} 320_ TTF gos price (EU