Zagreb, July 27, 2017 – The strong growth witnessed during Q1 2017 accelerated in the second quarter. EBITDA grew by 168% in H1, reaching HRK 1,398 million for the period, while net profit exceeded HRK 860 million, the best H1 result since 2011. Although Exploration & Production remained the main contributor to the results, Refining & Marketing incl. Retail saw the biggest improvement in its performance indicators.
- INA Group’s EBITDA amounted to HRK 1,398 million, 168% above the level in H1 2016, while net profit amounted to HRK 861 million
- Net debt down to HRK 2,026 million and gearing at a historically low level of 15.3%
- CAPEX amounted to HRK 520 million
- Domestic crude production remains stable, while domestic gas production onshore went up by 6% in relation to H1 2016
- Refinery production increased by 34%, and refined product sales grew by 23%
For Exploration & Production, a more favorable external environment managed to offset a slight decrease in production, resulting in 26% higher EBITDA compared to H1 2016. Refining & Marketing incl. Retail benefited from a period of favorable crack spreads which, alongside higher processing levels and strong Retail performance, pushed EBITDA into positive territory, reaching HRK 183 million for the first half year. Retail sales in both the fuel and non-fuel segments showed a record increase.
CAPEX amounted to HRK 520 million, impacted by different schedule of investments during the year, where a more intensive investment campaign is expected in the second half of 2017. Net debt decreased to HRK 2,026 million with gearing going to historically low level of 15.3%.
President of the Management Board of INA Mr. Zoltán Áldott said: “H1 2017 showed a respectable growth for INA results across all business operations. All main indicators are improved with EBITDA increasing from HRK 521 mn in H1 2016 to HRK 1.398 mn in H1 2017 while net profit, excluding one off items, jumped to HRK 608 mn from HRK 70 mn in H1 2016.
2016 efficiency program continued to show visible results in 2017 while favourable external environment brought additional relief. Combined, it led to the lowest indebtedness in the last decade and the ability of INA to finance all main strategic projects in forthcoming period.
Upstream results benefited from the improved external environment with modest growth of Brent and gas prices, while natural decline was slowed down by successful growth projects: EOR project and higher production from new wells Selec and Đeletovci Zapad. Combined with the efficiency program it led to the improved financial result.
Still, Upstream growth was surpassed by Downstream improvements. Significantly higher R&M processing levels further supported by more favorable margins drove the Downstream result to a positive area in EBITDA terms, but the cash flow still stays negative.
Retail maintains good results with regional network growth together with non-fuel expansion assuring constantly strong results.
It is worth to mention stabilized performance of our oil services activities, which were strongest hit by halved Brent prices in the past several years. Crosco reported positive EBITDA in H1 2017.
This relief period should also be used for further strengthening of the market position and operations, as long term outlook is difficult to make and the volatility of the market can once again prove challenging.”
EBITDA = EBIT + Depreciation + Impairment + Provisions