Galp Energia, Sgps S.a. Class B · EURONEXT:GALP
Galp Energia, Sgps S.a. Class B — Q3 2016 Earnings Presentation
20 slides from Galp Energia, Sgps S.a. Class B's earnings presentation, Oct 28, 2016
Slide 1: Results Third quarter 2016
October 28, 2016 Results Third quarter 2016
Slide 2: Cautionary Statement
Cautionary Statement 2 By attending or reading this presentation, you acknowledge and agree to be bound by the following limitations and restrictions. This presentation has been prepared by Galp Energia, SGPS, S.A. (“Galp” or the “Company”) and may be amended and supplemented, but may not be relied
Slide 3: Share performance and total shareholder return
Share performance1 Total shareholder return1 +121% +190% vs. vs. Peers2: -31% Peers2 SXXP: -3% SXEP: -27% +14% 1 Evolution since 23 October 2006 until 23 October 2016. TSR calculated in Euros. 2 Peers include: Eni, OMV, Repsol, Shell and Statoil. Third quarter 2016 results
Slide 4: 3Q16 highlights
3Q16 highlights 4 3Q16 Ebitda of €384 m, up 14% QoQ on higher upstream production and oil marketing seasonality, although down 6% YoY due to lower Oil & Gas prices and refining margins Maintaining a strong upstream development execution, with WI production increase driven by units’ ramp-up and s
Slide 5: Agenda
Agenda 5 Execution Update Financial Overview Appendix Third quarter 2016 results
Slide 6: 3Q16: Higher volumes but lower margins
3Q16: Higher volumes but lower margins 6 Brent price vs. Refining margin ($/bbl) Iberian market evolution (kton, mm3) 100 8 600 80 6 300 60 4 0 40 2 -300 20 0 -600 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 Brent Benchmark refining margin (RHS) Oil Market, YoY NG Market, Y
Slide 7: Maintaining strong execution pace
Maintaining strong execution pace 7 WI production growth QoQ kboepd FPSO #4 at plateau since August with full 74 ramp-up achieved in 13 months 55 FPSO #5 continues to ramp-up with five producers expected to be online by YE2016 Brazil FPSO #6 started production in July, with three (Lula/Iracema
Slide 8: Africa: Progressing with development projects
Africa: Progressing with development projects 8 Mozambique: Area 4 Angola: blocks 14/14k and block 32 Coral South: Finalising commercial agreements, Block 14/14k contributing steadily to production with LNG offtake agreement signed with BP Block 32: Drilling & Completion campaign and FPSO Ma
Slide 9: R&M: Robust contribution from downstream activities
R&M: Robust contribution from downstream activities 9 Refining Marketing Benefitting from the high availability of the refining Solid marketing performance, benefitting from system, despite much lower benchmark margins continued optimisation in Iberia Planned maintenance during 4Q16, namely at
Slide 10: G&P: Challenging NG/LNG macro environment
G&P: Challenging NG/LNG macro environment 10 Supply & Trading NG Infrastructure Power LNG trading impacted by fewer Regulated infrastructure business Power benefitting from increased arbitrage opportunities, although impacted by RoR revision from electricity sales to the grid supported by stru
Slide 11: Agenda
Agenda 11 Execution Update Financial Overview Appendix Third quarter 2016 results
Slide 12: Q3 Ebitda of €384 m, up 14% QoQ and down 6% YoY
Q3 Ebitda of €384 m, up 14% QoQ and down 6% YoY 12 Profit & Loss RCA (€m) 2Q16 3Q15 3Q16 QoQ YoY 9M16 YoY Higher E&P Ebitda driven by strong production growth YoY and QoQ Turnover 3,267 3,904 3,499 +7% (10%) 9,595 (21%) Ebitda 337 407 384 +14% (6%) 1,015 (17%) Downstream impacted by lower E&P 86
Slide 13: Group capex of €244 m mostly related to upstream
Group capex of €244 m mostly related to upstream 13 Capital Expenditure (€m) 852 874 85% of overall investment allocated to E&P, of which 93% to development activities, mainly in block BM-S-11 (Brazil) and block 32 (Angola) Downstream and gas capex of c.€35 m, in line YoY, including maintenance
Slide 14: Strengthening financial position
Strengthening financial position 14 Balance Sheet (€m)1 Jun.2016 Sep.2016 Dec.2015 (prior to GGND (prior to GGND Sep.2016 Δ Sep-Dec Δ Sep-Jun Net fixed assets of €8.5 bn, or €7.4 bn 2 reclassification) reclassification) 2 considering infrastructure assets accounted as held for sale Net fixed asset
Slide 15: GGND deal enhancing financial flexibility
GGND deal enhancing financial flexibility 15 Net debt evolution1 (€bn) 2.2 1.7 1.5 Includes dividend payments2 of €378 m YE2015 9M16 30.Set.2016 GGND deal 30.Set.2016 impact 3 + GGND deal 1 Considering loan to Sinopec as cash. 2 Includes the payment of €206 m relating to the interim dividend of 2016
Slide 16: Agenda
Agenda 16 Execution Update Financial Overview Appendix Third quarter 2016 results
Slide 17: E&P: Working interest production up 62% YoY
E&P: Working interest production up 62% YoY 17 Main E&P data 2Q16 3Q15 3Q16 QoQ YoY 9M16 YoY Brazilian production increased YoY, supported 1 by the ramp-up of FPSO #4, FPSO #5 and Working interest production kboepd 54.7 45.7 74.0 +35% +62% 61.7 +41% start of new unit Oil production kbpd 51.7 42.2
Slide 18: R&M: Ebitda impacted by lower refining margins
R&M: Ebitda impacted by lower refining margins 18 Main R&M data 2Q16 3Q15 3Q16 QoQ YoY 9M16 YoY Spread to benchmark of $1.1/boe, continuing to leverage arbitrage opportunities between Galp refining margin USD/boe 4.6 6.7 3.4 (26%) (50%) 4.0 (40%) Europe and the USA 1 Refining cash cost USD/boe 1.7
Slide 19: G&P: Ebitda flat YoY supported by structured trading
G&P: Ebitda flat YoY supported by structured trading 19 Main G&P data 2Q16 3Q15 3Q16 QoQ YoY 9M16 YoY NG/LNG volumes down 8% YoY given fewer trading opportunities NG/LNG total sales volumes mm3 1,593 1,909 1,750 +10% (8%) 5,203 (13%) Sales to direct clients 881 933 950 +8% +2% 2,732 (4%) Sales t
Slide 20: Investor Relations team
Investor Relations team 20 Pedro Dias, Head Otelo Ruivo, IRO Cátia Lopes João G. Pereira Results & presentation weblink : João P. Pereira www.galpenergia.com/en/investidor/Relatorios-e- Teresa Rodrigues resultados/resultados-trimestrais For further information on Galp, please go to: +351 21 724 08 6