INA’s results reflect sustainable backbone for future investments
Key figures:
- Net sales revenues amounted to almost EUR 3.9 billion
- CCS EBITDA amounted to EUR 496 million
- Investment spendings at the level of EUR 400 million
Zagreb, 16 February 2024 – Following the extraordinary 2022, 2023 was marked with stabilization of hydrocarbon prices, which resulted in somewhat lower but still strong results of INA Group. CCS EBITDA excl. special items for 2023 amounted to EUR 496 million while net profit remained at the 2022 level with around EUR 250 million, among others due to the fact that there was no windfall tax in 2023. Main driver of the EBITDA movement is the decrease of realized hydrocarbon prices by 28%, with gas prices drop much stronger than oil’s.
Exploration and Production EBITDA was lower following the external environment and moderate decline of production, EUR 413 million for 2023. Production declined in line with the expected natural decline due to maturity of fields and turnaround on gas treatment facilities. On the other hand, contribution was achieved with the Egyptian East Damanhur concession, which started with gas production in September and commercial discovery on Veliki Rastovac-1 well. All the factors resulted with only 6% lower production.
Refining and Marketing incl. Consumer Services and Retail segment result improved mainly due to strong market demand and positive contribution of own production. Retail sales volumes increased by 19%, mainly as a result of a good tourist season. Beside the strong fuel sales, non-fuel margin continued to grow (+33%). Simplified Free Cash Flow of the segment improved but stayed negative at EUR 103 million in 2023.
Investment spendings amounted to almost EUR 400 million, including EUR 85 million acquisition spending on additional 25% share in OMV Slovenia. Exploration and Production investments remained strong at EUR 100 million. Rijeka Refinery Upgrade Project reached 84% of total completion. Financial position was stable with net debt of EUR 216 million and 12% gearing ratio reflecting sustainable backbone for future investments.
Statement of Zsuzsanna Ortutay, President of the Management Board of INA:
“In 2023, amidst the aftermath of market turbulence in the previous year, the global economy found its footing, marking a period of stability. Energy prices, once erratic due to supply concerns, have now steadied, contributing to a more balanced landscape. Despite the inevitable impact of lower oil and gas prices in our Exploration and Production business, the company’s overall performance remained resilient. The INA Group saw a decrease in EBITDA by 22%, which was anticipated given the prevailing environment of reduced prices. However, investments spendings reached EUR 400 million in 2023, predominantly focused on domestic investments and gaining new captive market in Slovenia by acquiring additional 25% share in OMV Slovenia. Progress on key projects like the Rijeka Refinery Upgrade Project was notable, reaching 84% completion, alongside other ongoing growth projects and efficiency enhancements across the business segments.
In Exploration and Production, essential turnaround and upgrades were executed promptly, ensuring operational continuity. The inauguration of INA’s first solar plant for commercial production added a sustainable dimension to its energy portfolio, signalling a strategic shift towards renewable energy sources. The rebound of product markets was evident, with an 8% increase in total sales and a remarkable nearly 20% surge in Retail sales, attributed to heightened demand and a thriving tourist season. Amidst fluctuations in the market and operational cycles at the Rijeka Refinery, INA maintained unwavering supply reliability, underscoring its commitment to ensuring market stability.
Looking ahead to 2024, the global landscape remains fraught with challenges stemming from ongoing conflicts, casting uncertainty over markets worldwide. However, amidst these challenges lie opportunities for the energy sector’s transformation. INA, fortified by its stable operations and robust financial position, stays committed to navigate the complexities ahead, embracing opportunities for further enhancement and growth.”