Societatea Nationala De Gaze Naturale Romgaz S.a. · BVB:SNG
Societatea Nationala De Gaze Naturale Romgaz — Romgaz — 9M 2022 Earnings Presentation
36 slides from Societatea Nationala De Gaze Naturale Romgaz's earnings presentation, November 2022
Slide 1: 9M/Q3 2022 Results - Group Overview
ROMGAZ 9M/Q3 2022 Results - Group Overview November 2022 https://www.romgaz.ro/en/summary-results-and-presentation-investors 1
Slide 2: Disclaimer
Disclaimer Romgaz Group (Romgaz or Romgaz Group or The Company) consists of SNGN Romgaz SA as parent company, Filiala de Înmagazinare Gaze Naturale Depogaz Ploieşti SRL (subsidiary owned 100% by Romgaz SA), Depomureş SA (40% owned by Romgaz SA) and SC Agri LNG Project Company SRL (25% owned by Romga
Slide 3: Contents
Contents page # Gas market overview 4 ROMGAZ: Highlights 7 Main events / Fiscal framework applicable / Group developments in 9M/Q3 2022 ROMGAZ: Group Overview 10 Main Activities 13 Financial Performance 23 Investments 26 Main Strategic Objectives / ROMGAZ Strategy 2021 - 2030 27 Dividend Distributio
Slide 4: Gas market overview: Romania among top gas consumers and producers
Gas market overview Romania: among TOP gas consumers & producers in the region ROMGAZ: Among top Gas Producers in the region1 (2021 output, kboepd) Source: 1 Companies’ reports, Romgaz computation, Petrom: Romania+abroad, 225 OMV excluding Petrom. 2 CEIC Data; 93 87 62 52 14 ROMANIA: 2nd Gas Consume
Slide 5: Gas market overview: Prices on the Commodities Exchange
Gas market overview Romania: Prices on the Commodities Exchange 2022/2021, Market structure Natural Gas Prices on BRM, Current Imports and CEGH (RON/MWh) 1200 1200 1100 1100 BRM - Commodities Exchange (gas forward & spot) 1000 1000 Prices are shown in the month of delivery 900 900 Current Imports, a
Slide 6: Gas market overview: Total gas consumption lower by 14%
Gas market overview Romania: Total Gas consumption lower by 14% y/y over 9M/2022 (Romgaz estimate) Total Natural Gas Consumption* (million MWh) Mix of Energy Resources (9M/2022) 130 24 32 28 98 Coal/gas-fired plants -14% y/y 15% 21 33% Hydroplants 65 24 14% Nuclear plants 103 98 93 Other renewables
Slide 7: ROMGAZ Group: Highlights of events
ROMGAZ Group: Highlights of events Selected Events – important for our activity June 2, 2022 May 3, 2022 INVESTMENT Oct 27, 2021 INVESTMENT – Neptun Deep: Completion of an important MANAGEMENT: Romgaz signed the Share Sale and investment objective within the SGM approved the initiation Purchase Agre
Slide 8: Highlights regarding legislation: fiscal framework and regulatory environment
ROMGAZ Group: Highlights regarding legislation Romanian Legal Fiscal framework andon with impact Regulatory Environment Romgaz Group’s operations in 2022 - highlights GEO no 27/2022 and GEO no 119/2022 – regarding measures applicable to the energy & gas markets during April 1st, 2022 - August 31st
Slide 9: ROMGAZ Group: Highlights for 9M/Q3 2022
ROMGAZ Group: Highlights for 9M/Q3 2022 Robust financial performance in 9M/Q3 2022 based on the current environment 9M/2022: Market share Capex Gas production in domestic-gas RON 5,485 mln -0.5% y/y consumption (including Exxon Estim 51% acquisition) Windfall tax + EBITDA Net Profit Revenues Royalti
Slide 10: ROMGAZ: Group Overview
ROMGAZ: Group Overview Top Producer and Supplier of Natural Gas, Operator of UGS in Romania Gas Exploration, Production & Supply • 8 exploration blocks (Romgaz - 100% working interest) - significant onshore and offshore exploration potential, important discoveries and enhancements made lately • Top
Slide 11: Group Overview: Major Producer and Supplier of Natural Gas
Group Overview Major Producer and Supplier of Natural Gas in Romania – overview Over 100 years continuous history in gas exploration and production, with a well-established infrastructure Petroleum operations in 8 Exploration, Development and Production blocks (operator with 100% interest) Moldo
Slide 12: Gas portfolio: new independent external audit
Group Overview Gas portfolio – New independent external audit completed at end-Q2 2022, the RRR level External Audit of our Gas Reserves and Contingent Resouces - Dec 31, 2021 (bcm) External Independent Audit 50 The external independent audit of our gas reserves and contingent resources for Decemb
Slide 13: Exploration Activities
Exploration Activities 9M/2022: Steady efforts to secure and improve our onshore gas portfolio Romgaz: Minimum Working Commitment agreed Over 9M/2022, we continued measures to extend our with the National Agency for Mineral Resources portfolio by adding new gas resources and reserves: (ANRM) for the
Slide 14: Current Development Stage of main natural gas discoveries
Exploration Activities Current Development Stage of our main natural gas discoveries ON-SHORE: OFF-SHORE: CARAGELE DEEP: Ongoing exploration efforts to unlock the full potential of the project, both in terms of exploration TRIDENT BLOCK: 12.2% working interest and evaluation of previously discov
Slide 15: Acquisition of 50% of Neptun Deep
Exploration & Production Activities Other achievements in Q3: Acquisition of 50% of Neptun Deep On August 1st, 2022, ROMGAZ completed the transaction with ExxonMobil for the acquisition and transfer of all shares issued by ExxonMobil Exploration and Production Romania Limited (EMEPRL), representing
Slide 16: Natural Gas Production
Natural Gas Production 9M/Q3 2022: Onshore Production consolidated y/y, continuous development efforts Romgaz: Strong Production in Q3/9M (million cm) 9M/Q3 2022: Robust Output levels: 3,600 -0.5% Production in 9M of 3.69 bcm: roughly flat y/y (-0.5%) 3,150 In Q3, gas output was 1.17 bcm, adjust
Slide 17: Gas Supply & Sales
Gas Supply & Sales 9M/2022: Robust position in the market as regards gas deliveries Romgaz: Market share in domestic consumption (%, million cm) 80% Imports For 9M/2022, we estimate a market share of 51% – higher compared to the same period of 60% 53 - Production delivered (including - Iernut/Cojo
Slide 18: Gas Supply & Sales: record gas revenues
Gas Supply & Sales 9M/Q3 2022: Gas revenues at record level, volumes sold +0.7% in Q3 Romgaz: Gas Sales (including resales) Romgaz: Gas Chain Management (million cm) to - revenues and volumes - meet seasonality and demand 9,282 3,900 3,400 2,900 +211% 9M/2021 2,400 y/y 9M/2022 1,900 3,756 1,400 3,52
Slide 19: Underground Gas Storage
Underground Gas Storage Romgaz Group: Romania’s Largest Operator of UGS (Underground Storage) facilities Romgaz Group: Underground Gas Storages at end – September 2022 - working capacities (mln cm/cycle) - Bilciuresti 1,310 Ghercesti 150 Sarmasel 900 Balaceanca 50 Urziceni 360 Total Working Capacity
Slide 20: Underground Gas Storage: higher UGS revenues
Underground Gas Storage1 9M/Q3 2022: Higher UGS revenues in the period due to the current environment Romgaz: Revenues from Storage Services (million RON) - capacity reservation, withdrawal, injection - Romgaz: Storage tariffs (RON/MWh) 20 300 4.5 250 15 3.48 200 2.29 208 3.67 10 1.74 150 324 2.03 1
Slide 21: Electricity Production & Trading: Gas to Power investment
Electricity Production & Trading “GAS to POWER” Investment: Commissioning deadline is end-2023 Developments in 9M: New legal norms to help us finalise construction works by end-2023: GEO no 54 / April 2022: public acquisition procedures amended Government Decision no 834 / June 2022 - allows n
Slide 22: Electricity Production & Trading: record-high revenues
Electricity Production & Trading1 9M/Q3 2022: Record-high revenues due to a strong market demand Romgaz: Revenues from Electricity (million RON) Romgaz: Electricity Production (GWh) 1200 1000 9M/2022 839 800 9M/21 426 600 1,009 400 Q3/2022 295 200 510 Q3/21 223 103 146 0 Q3/21 Q3/2022 9M/21 9M/2022
Slide 23: Financial Performance: profitability rates
Financial Performance1 9M/Q3 2022: Resilient profitability rates, impacted by higher tax expenses Romgaz Group: Profitability Margins Romgaz Group: EBITDA by Segments (million RON) 51.7% 49.9% 9M/2022 (118) 3,139 73 37.5% 35.0% 31.7% 33.1% 9M/21 1,607 36 16 26.8% 21.5% 23.4% 20.7% 16.9% Q3/2022 (54)
Slide 24: Financial Performance: record-high revenues and net profit
Financial Performance 9M/2022: record-high Revenues +209%, Royalties&Windfall&Energy Tax +9x times, NP +94% y/y Summary 9M/2022 (vs 9M/2021) Million RON 2020* 2021 Q3/21 Q3/22 %ch 9M/21 9M/22 %ch Revenues - total 10,813 million RON (209 %) Revenues - of which 4,075 5,853 1,246 3,317 166% 3,497 10,8
Slide 25: Financial Performance: strong balance sheet
Financial Performance 9M/2022: Our Balance Sheet is strong Romgaz Group: Selected Balance Sheet Items Million RON Dec 31, 2019 Dec 31, 2020 Dec 31, 2021 Sep 30,2022 restated restated • At end-September 2022, total cash position amounted Total non-current assets, thereof 5,822 5,943 5,565 10,430 to R
Slide 26: Investments: Capex
Investments1 9M/2022: Capex – transaction related to Neptun Deep Project was completed in Q3 Romgaz Group: Capital Expenditures (RON million) Investments of ROMGAZ Group amounted to RON 5,485 million in 9M 2022, as follows: 5000 o Transaction related to Neptun Deep Project: this was completed in Q
Slide 27: Romgaz Group Strategy 2021-2030: Strategic Objectives
Romgaz Group Strategy 2021-2030 Strategic Objectives – Headlines 1. We continue to develop the portfolio of resources focused on mitigating climate changes effects, centered on resilient hydrocarbons and on operational safety and reliability 2. Electricity and energy with low CO2 emissions with larg
Slide 28: Strategy: Develop the gas resources portfolio
Romgaz Group Strategy 2021-2030 Develop the gas resources portfolio - focused on climate changes, safety and reliability Continue to develop the gas resources portfolio focused on mitigating climate changes effects, resilient hydrocarbons, operational safety and reliability Maximize the recovery I
Slide 29: Strategy: Develop the gas resources portfolio (exploration)
Romgaz Group Strategy 2021-2030 Develop the gas resources portfolio - focused on climate changes, safety and reliability Exploration-development-production activities in gas fields under concession Exploration - currently 3 major projects (with current production and significant potential): Over
Slide 30: Strategy: Sustainable Energy and Business Diversification
Romgaz Group Strategy 2021-2030 Sustainable Energy / Commercial Portfolio and Business Diversification Electricity and Energy with Low CO2 Emissions Production of photovoltaic energy – minimum of 180 MW capacities, a 60 MW solar park to be operational by the end of 2023 Assess the feasibility to
Slide 31: Strategy: Decarbonization, Digital Transformation, Social Responsibility
Romgaz Group Strategy 2021-2030 Decarbonization Policy / Digital Transformation of the Group / Social Responsibility Decarbonization Policy Min 10% reduction of carbon, methane & other gas emissions by 2030 (10-10-10, vs 2020) Implement a Nox emissions management system, including reducing gas emi
Slide 32: Dividend distribution
Dividend distribution SGM in April 2022 approved a gross dividend of RON 3.80 /share (76% payout ratio) Romgaz: Gross Dividend Distributions1 (RON million) Romgaz: Gross Dividend Payout ratios* 1 For the fiscal years 2019-2021: Dividend payment in the next fiscal year * Payout ratios computed as: 1,
Slide 33: Romgaz Group – Investment Case
Romgaz Group – Investment Case Why to invest in Romgaz shares EBITDA margin of 27%, EBIT margin of 23% and Net Profit margin of 21% Operational excellence / robust margins in 9M/2022 Gross Dividend payout ratio of 76% for 2021 (computed as Total Gross Dividends Minimum dividend payout ratio requ
Slide 34: Romgaz SA Board: Balanced Team of Professionals
Romgaz SA Board: Balanced Team of Professionals Dan Dragos Dragan Gheorghe Silvian Sorici Balazs Botond BoDs Chairman Independent Chairman of the Strategy Committee Chairman of the Audit Committee and of the Nomination and Remuneration Committee Balazs Botond – mandate of interim board- Dan Dragos D
Slide 35: Shareholding Structure and Stock Performance
Shareholding Structure and Stock Performance Romgaz: Among blue-chips on the domestic capital market RON 55.0 SNG: Share price on the BVB (RON) 12-Month: Share Price Performance on the BVB 50.0 BET NG rebased Period Min (RON) Max (RON) 45.0 Romanian Other Q4/21 33.50 39.00 State 40.0 shareholders 70
Slide 36: ROMGAZ Investor Relations
ROMGAZ Financial Calendar - 2022 Investor Relations Feb 25: Release of the 2021 Preliminary Financial Results Feb 28: Conference call with financial analysts and investors E-mail: investor.relations@romgaz.ro April 28: SGM to approve the “2021 BoDs Report” IR: Manuela Ogrinja, CFA April 29: Release