In Q1 2022, OMV Petrom recorded revenue growth of 145% YoY, EBITDA growth of 92%, and a net income of RON 1.75bn, an increase of 205% YoY.
Consolidated sales revenue grew by 145% YoY and amounted to RON 11.9bn, supported by higher commodity prices and higher sales volume of petroleum products and electricity. Of this, the Refining and Marketing segment represented 49% of total consolidated sales, while Gas and Power accounted for 51%. The last segment, Exploration, and Production accounted for only 0.1% of sales after the divestment of Kazakhstan subsidiaries in Q2 2021 (sales in Exploration and Production being largely intra-group rather than third-party sales).
Clean CCS Operating Result grew as well, amounting to RON 2.24bn, an increase of 243% YoY. This was due to a much higher contribution of all business segments following the increase in prices in the Exploration and Production segment, strong margins on gas from storage and third party transaction in the Gas and Power segment, as well as the higher refining margins in the Refining and Marketing segment.
Special items had net charges of RON -162m (Q1 2021: RON -61m), driven by the net temporary losses from forward contracts in the Gas and Power segment. Inventory holding gains amounted to RON 107m a slight decrease of 6% YoY, but still at a stable level due to the increase in crude oil prices.
With the higher prices in the market, EBITDA amounted to RON 2.92bn, up 92% YoY. The net financial result amounted to RON -82m (vs. Q1 2021: RON -34m), mainly due to the higher interest expenses in relation to the discounting of receivables. Income tax amounted to RON 355m, with the effective tax rate of 17% in Q1 2022, 2 p.p. higher YoY. Finally, the net profit amounted to RON 1.75bn, an increase of 205% YoY.
CAPEX amounted to RON 629m, an increase of 10% YoY. RON 453m of that investment went into Exploration and Production (Q1 2021: RON 511m). Investments in Refining and marketing amounted to RON 121m, a more than 2x increase, while investments in Gas and Power increased significantly, amounting to RON 49m (Q1 2021: RON 1m).
OMV Petrom key financials (Q1 2021 vs. Q1 2022, RONm)
The Company also touched on the conflict in Ukraine. They said they are continuously monitoring the situation, as well as the potential impact on its business operations. Disruptions in Russian commodity flows to Europe could result in increases in European energy prices, and could accelerate the risk of cost inflation. Sanctions on Russia and countersanctions issued by Russia could lead to disruptions in the global supply chains and shortages in raw materials, agricultural products, and metals, and thus, a further increase in the risk of inflation. Finally, they said they are regularly evaluating the impact on the Company’s cash flow and liquidity position.
Full-year 2022 Outlook
The Company also provided an outlook for 2022, provided that no significant lockdowns or supply disruptions appear. OMV Petrom expects that the avg. Brent oil price will be around USD 95/bbl (previous guidance was USD 75/bbl). Urals (oil from Russia) average discount to Brent is expected to remain high and volatile, reflecting the current geopolitical situation. The refining margin is expected to be significantly above the 2021 level (previous guidance: app. USD 6/bbl, 2021: USD 5.5/bbl). Demand for oil and gas to be on an upward trend, demand for power to be at similar levels to 2021, while demand for gas to be lower than in 2021. CAPEX is expected to increase to app. RON 4bn, depending on the investment climate (2021: RON 2.8bn).
