In Q1, the company observed an increase in sales of 11%, increase in operating profit of 19.3% and an increase in net income of 35%.

In Q1 2019, OMV Petrom observed an increase in sales of 11% YoY, amounting to RON 5.4bn. The increase could be attributed to higher commodity prices in RON terms and higher sales volumes of electricity and petroleum products, partially offset by lower sales volumes of natural gas.

When observing sales by segment, Downstream Oil accounted for 70%, Downstream Gas accounted for 28% and Upstream for 2%.

In Q1, operating expenses amounted to RON 4.3bn, which represents an increase of 12.4% YoY.

Operating profit amounted to RON 1.29bn, which represents an increase of 19.3%. The operating result was mostly driven by higher commodity prices.

Clean Current Cost of Supply (CCS) operating profit increased by 28% to RON 1.2bn. This was supported by positive evolution, both in Upstream, triggered by higher prices, and in Downstream, as a result of higher sales volumes of fuels and electricity.

Note that the CCS effect represents the difference between the cost of sales calculated using the current cost of supply and the cost of sales calculated using the weighted average method after adjusting for any changes in valuation allowances, in case the net realizable value of the inventory is lower than its cost.

Going further down the P&L, net financial result improved from a loss of RON -63m in Q1 2018 to a gain of RON 24m in Q1 2019, reflecting higher interest income mainly in relation to the clarification of a tax-related topic and favorable FX effects.

Net income attributable to stockholders was RON 1.15bn, representing an increase of 35%.

The Clean CCS net income attributable to stockholders was RON 1.06bn.

OMV Petrom Performance (Q1 2019 vs Q1 2018) (RON m)

Turning our attention to CAPEX, it amounted to RON 826m, representing a decrease of 2%. CAPEX consisted mainly in Upstream investments of RON 650m. Downstream investments amounted to RON 168m, of which RON 158m were in Downstream Oil. Note that for 2019 CAPEX (including capitalized exploration and appraisal) is currently expected to be around RON 3.7 bn, of which about 75% in Upstream.