• Gazprom Neft 9m 2018 Net Profit Up 58 Percent

     

    RUB298.7 billion — Gazprom Neft’s net profit for 9M 2018, a 58-percent increase on 9M 2017;
  • RUB614.5 billion adjusted EBITDA* for the first nine months of 2018 — up 53.9 percent on 9M 2017;
  • Free cash flow (FCF) for 9M 2018, standing at RUB134.8 billion, a 62.4-percent increase year-on-year.

Gazprom Neft announces its consolidated financial accounts (IFRS) for 9M/3Q 2018.

Revenue in the first nine months of 2018 amounted to one trillion, 827.3 billion rubles (RUB1,827,300,000,000), representing a 29.8 percent increase year-on-year.** Adjusted EBITDA demonstrated a more than 1.5-fold increase year-on-year, to RUB614.5 billion.* This increase reflects positive changes in oil prices on the global and domestic markets, the successful development of new upstream projects, as well as greater operational efficiency. Net profit attributable to PJSC Gazprom Neft shareholders totalled RUB298.7 billion for 9M 2018, an increase of 58 percent year-on-year.

Significant growth in the Company’s operational cash flow, together with the completion of key investments in infrastructure at new upstream projects, resulted in a positive free cash flow of RUB134.8 billion for 9M 2018.

Hydrocarbon production in 9M 2018, including Gazprom Neft’s share in production at joint ventures, increased by 2.8 percent year-on-year to 68.9 million tonnes of oil equivalent (mtoe), driven by higher production volumes at new fields, and Gazprom Neft’s increased interest in Arcticgas. The unit cost of hydrocarbon production in ruble terms saw a 5.2-percent reduction year-on-year, the result of optimising cost control at mature fields.

Refining volumes at Gazprom Neft’s own and joint-venture refineries during the period totalled 31.8 million tonnes, an increase of 6.6 percent year-on-year, following the completion of a planned refinery maintenance in 2017. The Company also increased its light petroleum product yield faster than expected, particularly with regard to production of high-octane gasoline and diesel fuels, as well as jet fuel. Sales volumes of oil products through premium distribution channels increased by 4.6 percent year-on-year, amounting to 20.3 million tonnes.

Alexander Dyukov, Chairman of the Management Board of Gazprom Neft, commented: “The Company has maintained its focus on improving the efficiency of its business processes and operations — reducing unit costs in oil production, increasing the daily production, further improving refining depth, and increasing the light product yield. Our performance across our key financial indicators is up by more than 50 percent over the first nine months of this year, and free cash flow has increased more than 1.5-fold. This consistent improvement in our financial and operational performance means Gazprom Neft has every justification for increasing dividend payments, and for further enhancing shareholder value.”

Financial highlights

3Q

2Q

∆, %

 

9M

∆, %

2018

2018

2018

2017

689.557

617.103

11.7

Revenues (RUB, millions)

1.827.293

1.407.856

29.8

714.662

639.592

11.7

Revenues after excise duties (RUB, millions)***

1.895.456

1.457.525

30.0

225.894

193.130

17.0

EBITDA (RUB, millions)

556.473

355.131

56.7

246.262

212.403

15.9

Adjusted EBITDA (RUB, millions)

614.462

399.246

53.9

21.12

20.40

3.5

$/boe

19.57

13.77

42.1

132.194

96.810

36.5

Profit attributable to Gazprom Neft PJSC shareholders (RUB, millions)

298.669

189.000

58.0

181.347

127.180

42.6

Operational cash flow

391.636

325.781

20.2

87.312

35.949

142.9

Free cash flow

134.846

83.013

62.4

0.79

1.01

(21.8)

Net debt/EBITDA

0,79

1,27

(37.7)

Key operational data

3Q

2Q

∆, %

 

9M

∆, %

2018

2018

2018

2017

177.90

168.51

5.6

Hydrocarbon production (including shares in joint ventures. mboe)

510.96

497.10

2.8

24.01

22.72

5.7

Hydrocarbon production (including shares in joint ventures. mtoe)

68.93

67.05

2.8

11.24

10.44

7.7

Refining throughput at own

refineries and joint ventures

(million tonnes)

31.81

29.85

6.6

7.43

6.74

10.2

Sales through premium channels (million tonnes)

20.27

19.37

4.6

2.93

2.81

4.1

Sales at filling stations (million tonnes)

8.41

8.14

3.3

* Adjusted EBITDA includes proportional EBITDA from associated and jointly controlled companies, equity accounting method.

** With effect from 1 January 2018 the Group moved over to the new IFRS 15 definition of “Revenue from Contracts with Customers”, leading to changes in accounting policies and adjustments to certain sums recognised in the company’s financial accounts. Export duties are reflected in revenue totals, and the excise duty on sales levied in Serbia in the form of a sales tax is excluded.

*** For reference — “Sales (revenue) including excise duties” include excise duties on sales in international markets (sales), applied to 4Q 2017.