INA: net sales revenues increase by 15% in Q1 2019
Zagreb, April 30, 2019 – In Q1 2019, INA Group net sales revenues increased by 15% compared to the same period last year. The positive result was driven by the continuation of favorable hydrocarbon prices and increased sales. EBITDA recorded a 12% increase to HRK 539 million while net profit excluding special items increased to HRK 58 million, being above previous year Q1 realization.
- INA Group’s EBITDA amounted to HRK 539 million, 12% more than in Q1 2018
- Net sales revenues increased by 15% and amounted to HRK 4,251 million
- CAPEX amounted to HRK 618 million, biggest level in Q1 since 2010
- Operating cash flow increased by 344%
- Profit from operations increased twice and amounted to HRK 130 million
Exploration and Production EBITDA excluding special items decreased by 18% to HRK 569 million with slightly lower realized hydrocarbon price and production slightly below 36 mboe/d. Crude oil production increased, primarily in Croatia and Egypt, however it was fully offset with decline of gas production. Nevertheless, net sales revenues of the business grew by 3% compared to Q1 2018, while CAPEX amounted to HRK 148 million which is 17% growth. CCS EBITDA of Refining and Marketing including Consumer services and Retail excluding special items amounted to HRK 14 million, compared to HRK (114) million in the same period last year. The result was achieved on the back of higher sales volumes in both wholesale and retail and strong sales margins, at a period of significantly lower processing due to major turnaround in Rijeka Refinery.
Compared to Q1 2018, CAPEX more than doubled to the level of HRK 618 million, mainly driven by investments into Rijeka Refinery. Net gearing further decreased to 6.6% with net debt at HRK 838 million.
Statement of Mr. Sándor Fasimon, President of the Management Board of INA:
“Following the 2018 strong performance, in Q1 2019 INA Group once again achieved a very strong result. INA utilized the market conditions and increased both its sales and EBITDA, revenues growing by 15%, to the level of over HRK 4 billion in just one quarter.
Upstream benefited from the stable hydrocarbon prices and production levels. Maturity of INA fields and the natural decline in gas production was offset by the continuous efforts in oil production increase. This was followed by the increase in investments, majority as before focused in Croatia, but also with a visible increase of spending in Egypt.
Refining operations are marked with a major turnaround in Rijeka refinery, one of the biggest in recent years. This, together with the other investments projects in the company, brought the investment level to HRK 618 million, biggest level in Q1 since 2010. Furthermore, this demonstrates INA commitment on developing all business activities in a sustainable way. Still, the deteriorated environment and the less favorable refining margins continue to burden the overall results of the segment expected to be mitigated in the future by INA DS New Course 2023 program.
Despite the expected lower processing levels, caused by turnaround, INA managed to increase its sales and utilize the market opportunities both domestically and on the core markets, visible by 8% sales increase in Croatia and 23% in Bosnia & Hercegovina. Retail operations also recorded a visible growth of 7%, partly due to expansion of Montenegro network.
Overall, despite the Q1 2019 being very investment intensive, the company’s financial position stays strong and the low debt levels allow for stable operations and future investments.”