23 slides from Galp Energia, Sgps S.a. Class B's earnings presentation, Feb 10, 2012
Slide 1: Full Year and Fourth Quarter 2011 Results
10 February 2012 Results FULL YEAR AND FOURTH QUARTER 2011 Delivering growth through exploration and production
Slide 2: Agenda
Key highlights Business overview Strategy execution update Final remarks Appendix 2 Full Year and Fourth Quarter 2011 results
Slide 3: Key highlights
Key highlights ▪ Net profit doubled to €79 Mln in 4Q11 ▪ Capital increase ensures development of Brazilian projects ▪ Lula/Cernambi development plan being executed ▪ Results from Mamba North should be announced shortly 3 Full Year and Fourth Quarter 2011 results
Slide 4: Business overview
Key highlights Business overview Strategy execution update Final remarks Appendix 4 Full Year and Fourth Quarter 2011 results
Slide 5: Net profit doubled to €79 Mln in 4Q11
Net profit doubled to €79 Mln in 4Q11 Profit & Loss (€Mln) 4Q11 4Q10 YoY QoQ 12M11 YoY ▪ G&P solid earnings driven by incremental trend in Turnover 4,375 3,538 +24% +2% 16,804 +20% supply margins and power EBITDA 212 177 +20% (4%) 797 (7%) business E&P 66 56 +17% +4% 251 +35% R&M 53 69 (23%) (28%) 2
Slide 6: Net debt impacted by transformational projects execution
Net debt impacted by transformational projects execution Balance sheet (€Mln) Dec.2011 Sep.2011 Dec - Sep Dec.2010 Dec - Dec ▪ €2.2 bln of work in progress to start Fixed assets 5,999 5,884 +115 5,426 +573 generating cash flow in Work in progress 2,174 2,494 (320) 1,981 +193 near future Strategic st
Slide 7: Short term outlook
Short term outlook ▪ 1Q12 working interest production targeted at c.22 kboepd ▪ Refining margin to recover from 4Q11 levels ▪ Marketing volumes down QoQ, still impacted by the Iberian economic environment ▪ Natural gas volumes to increase QoQ due to trading volumes 7 Full Year and Fourth Quarter 201
Slide 8: Strategy execution update
Key highlights Business overview Strategy execution update Final remarks Appendix 8 Full Year and Fourth Quarter 2011 results
Slide 9: Capital increase ensures strong and sustainable balance sheet
Capital increase ensures strong and sustainable balance sheet Net debt to Equity ▪ Financial close expected to the end of February 119% ▪ Gearing on a pro-forma basis under 20%, below the sector average 31% < 20% ▪ Cash inflow from transaction 1 Galp Energia Peers average Galp Energia 2 enables deve
Slide 10: Physical completion of Sines refinery almost concluded
Physical completion of Sines refinery almost concluded Sines refinery ▪ Towards a fully integrated refining system ▪ Production should progressively ramp up from April onwards ▪ Stable production expected for the end of 2Q12 10 Full Year and Fourth Quarter 2011 results
Slide 11: Results from Mamba North should be announced shortly
Results from Mamba North should be announced shortly Mozambique – Rovuma basin ▪ Currently evaluating the drill stem test (DST) results in Mamba North well ▪ On track to reinforce the potential of Rovuma basin ▪ Larger exploration and appraisal program in place to be executed throughout 2012 11 Full
Slide 12: 4th producing well in Lula to be connected until the end of 1Q12
4th producing well in Lula to be connected until the end of 1Q12 FPSO Cidade de Angra dos Reis1 ▪ Production wells onstream achieved highly productive rates ▪ Lula-1 project should reach full capacity in 2Q12 ▪ Additional wells to be connected to ensure a better reservoir management ▪ Start-up of EW
Slide 13: Final remarks
Key highlights Business overview Strategy execution update Final remarks Appendix 13 Full Year and Fourth Quarter 2011 results
Slide 14: Final remarks
Final remarks ▪ Funding needs solved on a challenging market environment ▪ Upgrade project on track to impact earnings ▪ Continuously de-risking exploration portfolio ▪ Lula development ahead of expectations 14 Full Year and Fourth Quarter 2011 results
Slide 15: Save the Date: Capital Markets Day 2012
SAVE THE DATE Galp Energia Capital Markets Day 2012 London March 6th 2012 15 Full Year and Fourth Quarter 2011 results
Slide 16: Appendix
Key highlights Business overview Strategy execution update Final remarks Appendix 16 Full Year and Fourth Quarter 2011 results
Slide 17: Lula production gaining relevance
Lula production gaining relevance Main E&P data 4Q11 4Q10 YoY QoQ 12M11 YoY ▪ Lula field drove working interest production growth Working interest production kboepd 21.6 20.1 +8% +4% 20.8 +7% with 2nd and 3rd producing Net entitlement production kboepd 13.0 14.3 (9%) +6% 12.1 +3% wells connected dur
Slide 18: EBITDA impacted by adverse market environment
EBITDA impacted by adverse market environment Main R&M data 4Q11 4Q10 YoY QoQ 12M11 YoY ▪ Refining margin affected Galp Energia refining margin $/bbl (0.0) 2.3 (102%) (105%) 0.6 (78%) by negative trend of Spread over benchmark $/bbl 0.6 1.0 (42%) (53%) 1.3 (11%) international refining Crude processe
Slide 19: G&P earnings supported by supply activity
G&P earnings supported by supply activity Main G&P data 4Q11 4Q10 YoY QoQ 12M11 YoY ▪ Natural gas supply volumes supported by NG supply total sales volumes M m3 1,414 1,340 +6% +22% 5,365 +9% trading activity Electrical M m3 387 465 (17%) (21%) 1,866 (4%) Industrial M m3 506 469 +8% +5% 2,001 +7% Re
Slide 20: Capex shift has already been initiated in 4Q11
Capex shift has already been initiated in 4Q11 Capital expenditure (€Mln) G&P ▪ Development activities R&M in Brazil responsible for E&P majority of E&P capex 1,233 1,000 ▪ Upgrade refining project absorbed c. 70% of R&M capex throughout 2011 ▪ G&P capex mainly 218 192 channelled to natural gas dist
Slide 21: Additional facilities of €0.91 Bln
Additional facilities of €0.91 Bln M/L-term debt reimbursement profile (€Mln) 1,000 ▪ Major debt reimbursement 800 scheduled for 2012-14 600 period 400 200 ▪ Total net debt of €3.5 Bln, 0 2012 2013 2014 2015 +2016 with an average life of 2.1 years Debt structure as of December 2011 ▪ Average interes
Slide 22: 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 23: 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