Mol Hungarian Oil & Gas Plc Class A · BET:MOL
Mol Hungarian Oil & Gas Plc Class A — MOL Group — Investor Presentation (November 2021)
78 slides from Mol Hungarian Oil & Gas Plc Class A's investor presentation, November 2021
Slide 1: MOL Group Investor Presentation November 2021
MOL GROUP INVESTOR PRESENTATION November 2021
Slide 2: MOL Group in Brief
MOL GROUP IN BRIEF INTEGRATED CENTRAL EUROPEAN MID-CAP OIL & GAS COMPANY CORE ACTIVITIES UPSTREAM DOWNSTREAM CONSUMER GAS SERVICES MIDSTREAM Exploration Petrochemicals Retail Production Refining Mobility CLEAN CCS EBITDA BY SEGMENTS IN 2020 (USD MN) UPSTREAM DOWNSTREAM CONSUMER GAS 689 740 510 201 K
Slide 3: MOL Group Geography
MOL GROUP GEOGRAPHY CEE-BASED INTEGRATED OPERATIONS AND INTERNATIONAL UPSTREAM SLOVAKIA UK RUSSIA NORWAY CZECH REP. KAZAKHSTAN HUNGARY AZERBAIJAN HQ SLOVENIA IRAQ PAKISTAN CROATIA ROMANIA EGYPT SYRIA (IN FORCE MAJEURE) BOSNIA SERBIA MONTENEGRO ANGOLA UPSTREAM DOWNSTREAM CONSUMER SERVICES 3
Slide 4: Agenda
AGENDA THE MOL GROUP EQUITY STORY SUPPORTING SLIDES Q3 2021 RECAP (LINK TO Q3 2021 RESULTS) DOWNSTREAM CONSUMER SERVICES EXPLORATION AND PRODUCTION FINANCIALS, GOVERNANCE AND OTHERS 4
Slide 5: The MOL Group Equity Story
v THE MOL GROUP EQUITY STORY = ~ - 4 TOMORROW > MOLGROUP
Slide 6: Deliver Today, Shape Tomorrow
DELIVER TODAY, SHAPE TOMORROW MOL 2030: we delivered on our interim promises MOL 2030+: unchanged direction, accelerated transition, profitably towards net-zero ESG: climate/CO2 in focus, but all stakeholders matter Downstream: increasing EBITDA to cover „fuel to chemicals” transformation E&P: net z
Slide 7: Downstream: Increasing EBITDA to Cover Fuel to Chemicals Transformation
DOWNSTREAM: INCREASING EBITDA TO COVER „FUEL TO CHEMICALS” TRANSFORMATION DELIVER TODAY Integrated, market leading Downstream model with strong customer relations in CEE Strong captive markets and a deeply integrated refining-chemicals-distribution value chain Value chain extension in chemicals in p
Slide 8: Consumer Services: Digitally-Driven Consumer Goods Retailer and Mobility Provider
CONSUMER SERVICES: BECOMING A DIGITALLY-DRIVEN CONSUMER GOODS RETAILER AND COMPLEX MOBILITY SERVICE PROVIDER DELIVER TODAY CEE market leader in fuel & convenience retailing Exploiting the fuel market potential in CEE Increasing Fresh Corner penetration, rising non-fuel contribution, further developm
Slide 9: E&P: Net Zero by 2030, Opportunistic International Approach
E&P: NET ZERO BY 2030, OPPORTUNISTIC APPROACH IN INTERNATIONAL E&P AND MANAGED DECLINE IN CEE DELIVER TODAY Proven capabilities to operate mature, onshore assets in a cost-efficient way Production on track to meet the guidance of ~110 mboepd Substantial unit cash flow generated on the back of favora
Slide 10: Gas Midstream: Stable Cash Flow
GAS MIDSTREAM: STABLE CASH FLOW DELIVER TODAY Regulated domestic transmission business Profitable international transit business spanning 6 regional countries Recent years saw significant pipeline and trade infrastructure developments as well as efficiency improvements SHAPE TOMORROW European gas ma
Slide 11: Fully Funded Transformation and Base Dividend
FULLY FUNDED TRANSFORMATION AND BASE DIVIDEND DELIVER TODAY Strong Q1-Q3 EBITDA driven by supportive macro All segments generated significant positive simplified FCF in Q1-Q3 2021 „Sustain” capex to be kept around USD 1.1bn in 2021-25 Robust balance sheet with ample financial headroom SHAPE TOMORROW
Slide 12: MOL 2030: We Delivered on Our Interim Promises
MOL 2030: WE DELIVERED ON OUR INTERIM PROMISES INTERIM TARGETS 2017-2020 STATUS ENTER NEW CHEMICAL POLYOL PROJECT REACHED 75% COMPLETION, PRODUCT LINE(S) COVID-RELATED DELAY IS UNAVOIDABLE 22 EFFICIENCY DELIVERED USD 110MN IN 2018, DOWNSTREAM EFFICIENCY ADDED USD 40MN IN 2019 FUEL-TO-PETCHEM PREPARA
Slide 13: MOL 2030+: Unchanged Direction, Accelerated Transition
MOL 2030+: UNCHANGED DIRECTION, ACCELERATED TRANSITION STRATEGY 2030+ We set the We delivered We need to right strategy on our interim speed up in 2016 promises transition KEY DIRECTIONS UNCHANGED… …WITH ADDITIONAL FOCUS ON Downstream transformation: Fuel-to-chemicals Accelerating the transformation
Slide 14: MOL 2030+: Profitably Towards Net-Zero
MOL 2030+: PROFITABLY TOWARDS NET-ZERO ACCELERATED LOW-CARBON TRANSITION 14
Slide 15: ESG: Climate/CO2 in Focus, But All Stakeholders Matter
ESG: CLIMATE/CO2 IN FOCUS, BUT ALL STAKEHOLDERS MATTER BOTTOM LINE AND SUSTAINABILITY ARE NOT MUTUALLY EXCLUSIVE CLIMATE/CO2 TARGETS OTHER STAKEHOLDER-RELATED TARGETS Reducing group-level Scope 1+2 emissions by 30% by 2030 CLIMATE & New waste management and water reservation ENVIRONMENT* strategy Do
Slide 16: GHG: Downstream and Fuel Sales Biggest Contributors
GHG: DOWNSTREAM AND FUEL SALES BIGGEST CONTRIBUTORS SCOPE 2 IS MINIMAL TOTAL GHG EMISSIONS SCOPE 1, 2 AND 3 REPORTING AND DISCLOSURE Scope 3 accounts for 90% of MOL Group’s total GHG emission footprint Climate related disclosures produced in accordance with the core elements Downstream accounts for
Slide 17: ESG: Sector-Leading Ratings and Disclosure
ESG: SECTOR-LEADING RATINGS AND DISCLOSURE TOP POSITIONS ACROSS LEADING ESG RESEARCH, RATING AND INDEX HOUSES INDEXES AND RATINGS DISCLOSURE Leading ESG disclosure through Integrated Reporting using both SASB and GRI for several years 3rd lowest risk among 48 global integrated Oil & Gas peers MOL PE
Slide 18: Downstream
DOWNSTREAM SHAPE TOMORROW > MOLGROUP
Slide 19: Integrated Downstream Model in CEE
INTEGRATED DOWNSTREAM MODEL IN CEE GROUP REFINERY YIELD, 2020 (%) 11 COUNTRIES 5 17 SALES OF mtpa REFINED PRODUCTS REFINERY NELSON COMPLEXITY OF PEERS2 AND 1.4 mtpa PETROCHEMICALS 16 6.1 Mtpa 14 8.1 Mtpa 11.5 4.5 Mtpa 12 10.6 10 9.1 EMPLOYEES NCI 8 6 ~9,300 MARKET SHARE (%)1 4 2 <10% 10-20% 20-40% 4
Slide 20: Deep Downstream Integration
DEEP DOWNSTREAM INTEGRATION DOWNSTREAM INTEGRATION Internal feedstock1: Capacity ~2.4 Mt in 2020 HDPE 420 kt OLEFINS CRUDE INTAKE: Petchem (ETHYLENE, ~15% PROPYLENE, • Russian: LDPE 285 kt 64% C4 STREAM) • Seaborne: ~45% 33% own Ethylene PP 535 kt • Own market 3 Refining ~80% 890 kt production: 4% c
Slide 21: 2050 Vision: Highly Efficient, Sustainable, Chemical-Focused
2050 VISION: HIGHLY EFFICIENT, SUSTAINABLE, CHEMICAL-FOCUSED WE HAVE A LONG-TERM VISION TO BECOME A SUSTAINABLE CHEMICALS COMPANY AND POWERING MOBILITY WITH AN AMBITION TO REDUCE CARBON FOOTPRINT AND STRIVING TO REACH NET ZERO EMISSION SUSTAINABLE CHEMICALS WE ARE THE (CENTRAL) EUROPEAN POWERING CHA
Slide 22: 2030 Directions Still Valid, Sustainability and Speed in Focus
2030 DIRECTIONS STILL VALID, SUSTAINABILITY AND SPEED IN FOCUS KEY PILLARS OF THE 2030 STRATEGY REMAIN INTACT 2030 Target Keep market share across the 2020s and harvest existing position EFFICIENCY & USD 1.2+bn Push for efficiency: to be among the most efficient refiners in Europe PROFITABILITY EBIT
Slide 23: Boosting Efficiency to Be Among the Best Refiners in Europe
BOOSTING EFFICIENCY TO BE AMONG THE BEST REFINERS IN EUROPE FOSSIL FUELS WILL REMAIN PROFITABLE IN THE 2020S; MORE EFFICIENCY = ACCELERATED TRANSFORMATION Fossil fuels to be dominant and profitable across the 2020s 1st quartile in HARVEST MARKET Defend market share and profitability on our core mark
Slide 24: Integrating Circular Economy into Our Core Business
INTEGRATING CIRCULAR ECONOMY INTO OUR CORE BUSINESS INTEGRATING BIO- AND WASTE-BASED STREAMS IN PRODUCTION AND SCALING UP RECYCLING IN OUR FEEDSTOCK… … IN OUR OPERATIONS … … IN OUR PRODUCT PORTFOLIO Refinery Industry Sustainable Fuels (e.g biofuels, hydrogen, biogas, electricity) Homes Renewable Ele
Slide 25: Transformation Program of INA R&M
TRANSFORMATION PROGRAM OF INA R&M RIJEKA REFINERY UPGRADE PROJECT RECEIVED FID IN Q4 2019 COMPLEX UPGRADE OF THE RIJEKA RIJEKA REFINERY REFINERY Continuing the upgrade of the refinery USD via the installation of a Delayed Coker 100+ (DC) unit enabling full conversion and TRANSFORM SISAK INTO AN INDU
Slide 26: Multiple-Waves Plan to Convert 1.8 Mtpa Fuels into Chemicals
MULTIPLE -WAVES PLAN TO CONVERT 1.8 MPTA FUELS INTO CHEMICALS USING HIGHLY EFFICIENT TECHNOLOGIES AND TARGETING 2027 AND 2030 START-UPS 1st step Select site & technology USD 1.2-1.4 bn onstream F2C 0.5 mtpa focus on gasoline conversion Following Screening of Shortlisted USD 1.0-1.5 bn steps 25+ 3 Se
Slide 27: Fuel to Petchem: Significant Shift in Yields by 2030 and Beyond
FUEL TO PETCHEM: SIGNIFICANT SHIFT IN YIELDS BY 2030 AND BEYOND PETCHEM FEEDSTOCK, OTHER HIGH-VALUE PRODUCTS TO INCREASE BY 1-2 MN TONS GROUP REFINERIES’ YIELD (Mt) NON-FUEL YIELD INCREASE ROADMAP 2015 2030 Short-to-mid term opportunities, shifting 500-1000 kt: Utilizing existing flexibility to prod
Slide 28: Value Chain Extension in Chemicals: Polyol
VALUE CHAIN EXTENSION IN CHEMICALS: POLYOL WITH AN EXPECTED USD 150 + MN MID-CYCLE EBITDA CONTRIBUTION PRODUCTION RAMP-UP OF THE POLYOL PLANT PROPYLENE VS. POLYOL SPREADS1 (EUR/T) Relative deviation: PO – propylene: 21% Propylene-glycol 1.800 PP – propylene: 47% Polyol 1.600 1.400 1.200 1.000 800 60
Slide 29: Beyond-Polyol: Smaller Value Chain Extension Projects by 2030
BEYOND-POLYOL: SMALLER VALUE CHAIN EXTENSION PROJECTS BY 2030 CAPEX DISCIPLINE PROMPTED TO DEPRIORITIZE BIG TICKET DIVERSIFICATION INVESTMENTS FOR NOW 2030 Target Additional USD LARGE-SCALE Polyol: 89.3% completion, start-up planned for H2 2022, gradual ramp- INVESTMENTS 150+ mn up EBITDA p.a. Other
Slide 30: Reducing CO2 Footprint by 20% and Integrating Waste
REDUCING CO2 FOOTPRINT BY 20% AND INTEGRATING WASTE FROM ADVANCED BIOFUEL PRODUCTION THROUGH WASTE-TO-CHEMICALS INTEGRATION TO CARBON CAPTURE 2030 Target Reducing CO2 emissions, striving for net zero by 2050 MINIMIZE -20% CCS1 solutions on core sites for up to 1.4 mtpa of CO2 in joint FOOTPRINT Scop
Slide 31: Sustainability: First Steps Towards Decarbonization
SUSTAINABILITY: FIRST STEPS TOWARDS DECARBONIZATION Strategic partnership with Meraxis and APK companies RECLYING 80+ ktpa in polymer recycling by 2025 Acquisition of German recycled plastic compounder in 2019 COMPOUNDING 50+ ktpa in compounding by 2025 RUBBER BITUMEN Patented technology since 2013
Slide 32: MOL's Compounding Story from 2019 to Today
MOL’S COMPOUNDING STORY FROM 2019 TO TODAY BUILDING OFF OUR ACQUISITION OF AURORA KUNSTSTOFFE TO SUPPORT OUR AMBITIONS TO BE A REGIONAL LEADER IN SUSTAINABLE POLYPROPYLENE COMPOUNDS Product development started Product launch at Fakuma tradeshow focused on automotive; sample of in Germany, learn more
Slide 33: USD 4.5bn Modular Transformation – Indicative Roadmap
USD 4.5BN MODULAR TRANSFORMATION – INDICATIVE ROADMAP RETAINING A LEADING POSITION AND GENERATE ATTRACTIVE RETURN IN THE 2020S WHILE TRANSFORMING 2022 2024 2026 2027 2030 POLYOL PROJECT SOLVENT BASED FIRST BIOREFINERY 1ST STEP FUEL TRANSF. 2ND STEP FUEL TRANF. (220 KTPA) RECYCLING SCALE UP (50+ KT)
Slide 34: Increasing EBITDA to Cover Strategic Capex in 2021-25
INCREASING EBITDA TO COVER STRATEGIC CAPEX IN 2021-25 DOWNSTREAM TO GENERATE POSITIVE SIMPLIFIED FCF IN 2021-25 AT CONSERVATIVE MID-CYCLE MACRO EBITDA, CAPEX AND FCF 2021-2025 (USD BN) COMMENTS Ref margin: Downstream to deliver significant EBITDA growth +1 USD/bbl +USD 0.9-1.0bn from USD 0.7-0.8bn t
Slide 35: Consumer Services
CONSUMER SERVICES SHAPE TOMORROW > MOLGROUP
Slide 36: A Leading Regional Network
A LEADING REGIONAL NETWORK CZECH R. MARKET POSITION: 2 MARKET LEADING MARKET SHARE: 21% SLOVAKIA MARKET POSITION: 1 MARKET SHARE: 48% IN 90% OF THE NETWORK HUNGARY TOP 3 MARKET POSITION: 1 MARKET SHARE: 44% IN 90% OF THE NETWORK SLOVENIA MARKET POSITION: 3 MARKET SHARE: 11% ROMANIA 9 COUNTRIES MARKE
Slide 37: Become a Digitally-Driven Consumer Goods Retailer and Mobility Service Provider by 2030
BECOME A DIGITALLY-DRIVEN CONSUMER GOODS RETAILER AND INTEGRATED, COMPLEX MOBILITY SERVICE PROVIDER BY 2030 Regional leader in fuel Continuous improvement Diversification of and convenience retailing of operational efficiency sales channels Organic expansion of the network Strong standardization and
Slide 38: CEE Market Leader in Fuel & Convenience Retailing
CEE MARKET LEADER IN FUEL & CONVENIENCE RETAILING 1 700 mn EBITDA 2 85% more FCF in 5 years 3 60% convenience sales increase Market leader in fuel & 4 30% fuel volume incease convenience retailing 5 0% CO2 emission in operation 6 50% increase in active loyalty customers 38
Slide 39: Consumer Services Will Reach USD 700+ mn EBITDA by 2025
CONSUMER SERVICES WILL REACH USD 700+ MN EBITDA BY 2025 TOTAL GROSS MARGIN TO GROW AGAIN BY AROUND 50% IN THE NEXT FIVE YEARS FUEL AND NON-FUEL MARGIN CONTRIBUTION (USD MN) 2016 2020 2025 ~50% EBITDA (USD) 307mn 508mn 700+mn ~1,450 ~200mn CAPEX (USD) 220mn ~130mn (5-year avg.) 35% FCFF (USD) 49% - ~
Slide 40: Strengthening CEE Leadership in Fossil Fuel Retailing
STRENGTHENING CEE LEADERSHIP IN FOSSIL FUEL RETAILING THROUGH INCREASING MARKET SHARE AND UPGRADED PORTFOLIO FUEL VOLUMES (BN LITERS) STRENGTHENING LEADING POSITION IN CEE CAGR CAGR 4% -10% 6% Strengthened regional market-leading position, ~7,300 increasing the market share by 1ppt annually 5,548 5,
Slide 41: Expanding the Alternative Fuel Portfolio
EXPANDING THE ALTERNATIVE FUEL PORTFOLIO TO COMPENSATE THE SHRINKING OPPORTUNITIES IN FOSSIL FUELS BEYOND 2025 2016-2020 2021-2025 Beyond Foundations Accelerating 2025 in EV- growth and Step charging pilots change Capability and knowledge building Build additional presence in the Significant investm
Slide 42: Further Development in Food and Convenience Offerings
FURTHER DEVELOPMENT IN FOOD AND CONVENIENCE OFFERINGS BY BUILDING ON OUR OWN FMCG CAPABILITIES NON-FUEL SALES (USD MN) FRESH CORNER PENETRATION (%) CAGR +10% ~1 900 49 +39% 46 +7% 36 1 101 1 170 1 175 957 24 13 2017 2018 2019 2020 ... 2025 2016 2017 2018 2019 2020 NON-FUEL MARGIN (USD MN) IMPROVING
Slide 43: Diversification of Sales Channels
DIVERSIFICATION OF SALES CHANNELS THROUGH DIGITAL TRANSFORMATION AND FRANCHISE OPERATION 2016-2020 2021-2025 Beyond Digital and 2025 Synergies & data-driven platform Step operation building change Supporting traditional loyalty Start personalizing retail customers’ Integrate retail and mobility to s
Slide 44: Mobility Services to Grow Further
MOBILITY SERVICES TO GROW FURTHER AND EXPLOIT SYNERGIES THROUGH DIGITAL PLATFORMS 2016-2020 2021-2025 Beyond Start and 2025 Synergies & capability platform Step building building change Capabilities built in B2C and B2B Mobility as a Service: Offering seamless, digitally customer brands Explore the
Slide 45: Sustainability Goals
SUSTAINABILITY GOALS Carbon neutrality by 2030: renewable energy c to cover the consumption of the service station network, including the EV chargers Carbon offsetting initiatives Conscious waste management Extensive use of recyclable materials (e.g. coffee cups) at Service Stations 45
Slide 46: ~USD 2.3bn Simplified FCF in 2021-25
~USD 2.3BN SIMPLIFIED FCF IN 2021-25 RISING EBITDA TO YIELD HIGHER SIMPLIFIED FREE CASH FLOW IN 2021-2025 2016-2020 STRATEGIC ACTIONS EBITDA AND FCF IN 2021-2025 (MN USD) DRIVERS 3,300 100 100 Increasing gross margin 200 contribution of consumer goods 700 from 27% in 2020 to ~33% by 2025 Expansion o
Slide 47: Exploration and Production
EXPLORATION AND PRODUCTION SHAPE TOMORROW > MOLGROUP
Slide 48: ~364 MMboe 2P Reserves and ~112 mboepd Production
~364 MMBOE 2P RESERVES AND ~112 MBOEPD PRODUCTION NO RUSSIA CEE INTERNATIONAL UK Reserves: 149.1 MMboe KAZAKHSTAN Reserves: 215.0 MMboe Production: 57.5 mboepd Production: 54.2 mboepd HUNGARY AZERBAIJAN WEU (NORTH SEA) Reserves: 57.2 MMboe IRAQ Reserves: 15.9 MMboe HU Production: 32.4 mboepd RO EGYP
Slide 49: Production on Track to Meet the Guidance of ~110 mboepd
PRODUCTION ON TRACK TO MEET THE GUIDANCE OF ~110 MBOEPD ACG E&P International excl. ACG CEE PRODUCTION (MBOEPD) COMMENT 2021 YTD: Natural decline in Hungary and the UK is partially 120.1 110.6 111.0 111.7 110.0 offset by the strong performance of international assets A favourable oil price scenario
Slide 50: Favourable Price Environment and Strong Cost Discipline Resulted in USD ~800mn SFCF
FAVOURABLE PRICE ENVIRONMENT AND STRONG COST DISCIPLINE RESULTED IN USD ~800MN SFCF GENERATION PRICE REALIZATION, EBITDA, SIMPLIFIED FCF (USD/BOE) 71 68 64 Brent price 54 Realized HC price 44 42 Unit EBITDA Unit Simplified FCF 25 26 14 18 7 9 2016A 2017A 2018A 2019A 2020A 2021 Q1-Q3 260 548 992 747
Slide 51: E&P Vision: Net Zero by 2030
E&P VISION: NET ZERO BY 2030, OPPORTUNISTIC APPROACH IN INTERNATIONAL E&P AND MANAGED DECLINE IN CEE CLIMATE STRATEGY Net-zero until 2030 (Scope 1 and Scope 2) EOR opportunities and CCUS pilot project E&P 2030 CEE VISION Transform the largest Pannonian oil and gas producer into the largest Pannonian
Slide 52: We Target Net Zero Scope 1 and 2 Emission by 2030
WE TARGET NET ZERO SCOPE 1 AND 2 EMISSION BY 2030 2019 CO2 EMISSION WHERE ARE WE? MOL E&P has 30+ years experience in Hungary and 10+ years in Croatia 0.9MT CO2E in CO2 storage; established regulatory framework and valuable operational experience (Scope 1 + Scope 2) MOL follows internationally recog
Slide 53: USD ~1.9bn Capex to Be Spent in 2021-2025
USD ~1.9BN CAPEX TO BE SPENT IN 2021-2025 2021-2025 CAPEX SPENDING* CEE Brownfield developments in Hungary USD ~1.9bn Ramp-up of Croatian offshore campaign Sustain & Shallow gas and offshore exploration in Hungary and Croatia 14% Other Other 28% International INTERNATIONAL ACG/ACE will be the single
Slide 54: USD ~1.8bn SFCF to Be Delivered in 2021-2025
USD ~1.8BN SFCF TO BE DELIVERED IN 2021-2025 EBITDA, CAPEX AND FCF* (USD BN) KEY MESSAGES Sensitivity: USD 10/bbl change in oil price USD 1.8bn pre-tax and USD 1.3bn post- resulting in USD ~0.8bn effect on EBITDA tax FCF to be delivered by E&P in 2021- (cumulative 2021-25) 2025 3.9 Strong cost contr
Slide 55: Financials, Governance and Others
FINANCIALS, GOVERNANCE AND OTHERS
Slide 56: Strongest Q1-Q3 EBITDA Driven by Supportive Macro
STRONGEST Q1-Q3 EBITDA DRIVEN BY SUPPORTIVE MACRO EBITDA GUIDANCE RAISED AGAIN 2020 Q1-Q3 2021 2021 RESULTS RESULTS GUIDANCE GROUP CLEAN AROUND OR ABOVE USD 2.05 BN USD 2.58 BN CCS EBITDA USD ~3.2BN GROUP CAPEX USD 1.41 BN USD 996 MN USD ~1.7BN (ORGANIC) AROUND OR ABOVE SIMPLIFIED FCF* USD 636 MN US
Slide 57: Strong Q3 2021, Affected by Favorable Macro
STRONG Q3 2021, AFFECTED BY FAVORABLE MACRO VERY STRONG DOWNSTREAM, UPSTREAM AND CONSUMER SERVICES CONTRIBUTION CLEAN CCS EBITDA (USD BN) ~3.2 2.7 0.6 2.4 2.4 2.2 0.9 1.3 2.0 Q3 0.7 1.1 1.0 0.7 1.2 Q2 1.2 1.0 0.9 0.7 0.9 0.4 0.4 0.5 0.5 0.3 0.7 Q1 0.2 0.2 0.2 0.2 0.2 -0.2 -0.2 -0.2 -0.1 -0.1 2016 20
Slide 58: Robust Simplified Free Cash Flow in 2015-2020
ROBUST SIMPLIFIED FREE CASH FLOW IN 2015-2020 ALL SEGMENTS GENERATED SIGNIFICANT POSITIVE SIMPLIFIED FCF IN Q1-Q3 2021 SIMPLIFIED FCF (USD BN) 1.4 1.4 1.2 0.5 0.2 1.0 Q3 0.7 0.4 0.6 0.8 0.7 0.7 0.4 Q2 0.5 0.4 0.2 0.4 0.3 0.2 0.3 Q1 0.4 0.2 0.2 0.2 0.1 0.2 -0.5 2016 2017 2018 2019 2020 Q1-Q3 2021 Ups
Slide 59: Sustain Capex to Be Kept Around USD 1.1bn in 2021-25
„SUSTAIN” CAPEX TO BE KEPT AROUND USD 1.1BN IN 2021-25 SUSTAIN CAPEX (USD BN) COMMENTS 1.3 2020 is not a „normalized” year, as sustain capex declined materially 1.1 ~1.1 ~1.1 0.4 in 2020, as a response to the crisis 1.0 (delayed projects, lower 1.0 0.9 0.3 maintenance) 0.3 ACG added around USD 100-2
Slide 60: At Least USD 3.5bn Strategic Capex in 2021-25
AT LEAST USD 3.5BN STRATEGIC CAPEX IN 2021-25 TO FUND THE DOWNSTREAM TRANSFORMATION AND NEW, LOW-CARBON BUSINESSES STRATEGIC/TRANSFORMATIONAL CAPEX IN 2021-25 COMMENTS USD 3.5bn Even with a conservative mid-term macro set, in the 2021-25 period at least USD 3.5bn capex (around USD 700mn annually) wi
Slide 61: Fully Funded Transformation and Base Dividends in 2021-25
FULLY FUNDED TRANSFORMATION AND BASE DIVIDENDS IN 2021-25 EVEN AT CONSERVATIVE MACRO ASSUMPTIONS FINANCIAL FRAMEWORK PROJECTIONS FOR 2021-25 (USD BN)1,2 COMMENTS Even with conservative macro 12.0 assumptions sufficient cash (~USD 12bn) will be generated in the next 5 years to -5.5 fund „sustain” cap
Slide 62: Dividend Has a Placeholder in the 2021-25 Financial Frame
DIVIDEND HAS A PLACEHOLDER IN THE 2021-25 FINANCIAL FRAME PROVIDING A FAIR RETURN TO SHAREHOLDERS IS AN INTEGRAL PART OF THE TRANSITION STORY DIVIDEND PER SHARE1 (HUF) 3.0% 2.9% Up to Dividend 3.5% 3.0% +1.5% +1.5% 5% yield2 Special dividend 48 Regular dividend 43 1.3% share buyback was 95 95 78 85
Slide 63: Sources and Applications of Cash
SOURCES AND APPLICATIONS OF CASH SOURCES AND APPLICATIONS OF CASH, 2012-20 (USD MN)1 252 81 78 0 1 199 115 716 162 1 502 738 402 383 202 350 261 427 2 687 37 2 447 322 2 435 2 153 111 2 079 2 048 1 412 1 290 1 011 1 037 2016 2017 2018 2019 2020 Clean CCS EBITDA Organic CAPEX Inorganic CAPEX Interest
Slide 64: Robust Balance Sheet with Ample Financial Headroom
ROBUST BALANCE SHEET WITH AMPLE FINANCIAL HEADROOM RETAINING FINANCIAL STRENGTH AND FLEXIBILITY IS A PRIORITY NET DEBT TO EBITDA (X) COMMENTS An overriding principle of financial management is to 2.5 ensure operations remain cash positive even under stress, at the bottom of the cycle (as in 2020) 2.
Slide 65: Ample Financial Headroom
AMPLE FINANCIAL HEADROOM FROM DIVERSIFIED FUNDING SOURCES AVERAGE MATURITY OF 3.36 YEARS Reported cash & cash equivalents Medium term loan Undrawn facilities Senior Unsecured Bonds Long term loan (multilaterals) 1,500 1,000 753 270 23 USD mn 51 1,401 500 1,120 973 1,075 868 9 167 45 0 13 22 Reported
Slide 66: Full Investment Grade Rating Preserved
FULL INVESTMENT GRADE RATING PRESERVED EVEN DURING UNPRECEDENTED AND CHALLENGING MARKET CONDITIONS HISTORICAL FOREIGN LONG TERM RATINGS COMMENTS In July 2021 Standard & Poor’s reviewed rating – no action, rating kept at investment grade BBB- with stable outlook In June 2021 Fitch reviewed rating – n
Slide 67: INA: Focus on Securing Return on Our Investment
INA: FOCUS ON SECURING RETURN ON OUR INVESTMENT REALITIES AND PRIORITIES STRONG REGIONAL ASSET BASE MOL 2030 strategy can be and will be executed with or Low-cost E&P in Croatia* (both onshore and off-shore) without INA Coastal refinery (Rijeka) Good geographical fit and untapped efficiency upside i
Slide 68: The History of INA & MOL, 2003-2021
THE HISTORY OF INA & MOL, 2003-2021 STORYLINE SHAREHOLDER AGREEMENTS UNDER THE FASHA, MOL DELEGATES FIVE 1ST SHAREHOLDER RIGHTS AGREEMENT (SHA): MOL AND THE GOVT OF CROATIA SIGN THE GAS OUT OF NINE MEMBERS TO THE MOL ALLOWED TO NOMINATE TWO MEMBERS 1ST AMENDMENT MASTER AGREEMENT (GMA) AND AN SUPERVI
Slide 69: MOL-Croatia Arbitration Status
MOL-CROATIA ARBITRATION STATUS UNCITRAL ARBITRATION ICSID ARBITRATION (CROATIA VS. MOL) (MOL VS. CROATIA) INITIATED GOVERNMENT OF CROATIA MOL BY WHEN 17 JANUARY 2014 26 NOVEMBER 2013 PCA (PERMANENT COURT OF ARBITRATION), GENEVA ICSID (INTERNATIONAL SETTLEMENT OF INVESTMENT FORUM UNDER UNCITRAL (UNIT
Slide 70: Shareholder Structure
SHAREHOLDER STRUCTURE(1) Commerzbank AG Treasury shares UniCredit Bank AG 2.6% ING Bank N.V. 3.4% 4.5% 1.2% OTP Bank Plc. Foreign investors (mainly institutional) 4.9% 26.7% OmanOil (Budapest) Limited 7.1% Free-float 45.8% Mathias Corvinus Collegium Foundation 10.0% 10.5% Domestic institutional 10.0
Slide 71: Normalized but Still High Commodity Prices
NORMALIZED BUT STILL HIGH COMMODITY PRICES SUPPORTS STRONGEST RESULTS EVER EXTERNAL ENVIRONMENT* VS MOL CLEAN CCS EBITDA (USD MN) 100% 1200 85% 1000 70% 800 55% 600 40% 400 25% 200 10% 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
Slide 72: Key Items of Taxation
KEY ITEMS OF TAXATION CORPORATE INCOME TAX (CIT) RATES CUT IN CORE OPERATING COUNTRIES HUNGARY Statutory CIT rate is 9% Profit based ’Robin Hood’ with an effective tax rate of 19% Only energy related part of the profit affected statutory tax rate is 31% Only the Hungarian operation of certain compan
Slide 73: MOL Group Refinery and Petchem Margins
MOL GROUP REFINERY AND PETCHEM MARGINS MOL GROUP REFINERY MARGIN1 (USD/bbl) PETROCHEMICALS MARGIN (EUR/t)2 1100 10 9 1000 8 900 7 6 800 5 700 4 600 3 2 500 1 400 0 -1 300 -2 200 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2015-2020 range 2021 2020
Slide 74: A Conservative Mid-Term Base Macro Framework
A CONSERVATIVE MID-TERM BASE MACRO FRAMEWORK AND RISING CARBON PRICE ASSUMPTION KEY MACRO ASSUMPTIONS CCS EBITDA SENSITIVITY TO KEY EXTERNAL DRIVERS Sensitivity Est. Clean CCS EBITDA % of Group 2018 2019 2020 9Y AVG 2021-25E impact (USD mn) EBITDA 2021E Brent crude 40-60 +/- 10 USD/bbl 71 64 42 72 ~
Slide 75: Top Management Incentive Schemes
TOP MANAGEMENT INCENTIVE SCHEMES FOR EXECUTIVE MEMBERS, AROUND 2/3 OF TOTAL REMUNERATION IS VARIABLE AND PERFORMANCE DRIVEN SHORT-TERM INCENTIVES Bonus opportunity between 0.70x and 1x of annual base salary, depending on the level Payout linked to yearly performance based on financial, operational a
Slide 76: Gas Midstream: Stable Cash Flow
GAS MIDSTREAM: STABLE CASH FLOW GAS MIDSTREAM EBITDA (HUF BN, USD MN) FACTS & FIGURES Domestic natural gas transmission system 70 223 250 operator 194 201 60 189 187 200 Regulated business (asset base and return) 50 159 with continuous regulatory scrutiny 40 150 101 Nearly 6,000km pipeline system in
Slide 77: 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 78: Presentation Manual
PRESENTATION MANUAL LINKS ( )ARE AVAILABLE THROUGHOUT THE PRESENTATION THAT DIRECT YOU TO MORE INFORMATION ON THE SELECTED TOPIC. A NAVIGATION BAR ON THE TOP OF EACH SLIDE IS ALSO AVAILABLE, WITH THE FOLLOWING BUTTONS: HOME: GO TO THE SUMMARY SLIDE HELP: GO TO PRESENTATION MANUAL BACK: GO TO PREVIOU