Rosneft Q2 revenue up 17.6%, EBITDA margin up 27.6%
Staff Writer |
In Q2 2016 Rosneft revenue increased by 17.6% vs. Q1 2016 to RUB 1,232 billion ($19.2 billion).
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This was driven by the improvements in the oil market and recovery in ruble oil price, and also, by ongoing efforts aimed at improving the marketing channels efficiency. Thus, in Q2 2016, oil sales revenue grew by 28.8% against Q1 2016.
Rosneft maintained strict OPEX discipline. Upstream operating expenses per boe (RUB 164/boe - $2.5/boe) were lower than the dynamics of the consumer price index and administrative expenses have not changed significantly.
In Q2 2016, the earnings before interest, taxes, depreciation, and amortization (EBITDA) reached RUB 348 billion ($5.3 billion), rising by 28% vs. Q1 2016. EBITDA dynamics exceeded the oil price growth, due to cost control, improving marketing efficiency and a positive lag on export duties.
EBITDA margin increased up to 27.6% that is the highest performance in the last 6 years.
In H1 2016, EBITDA amounted to RUB 621 billion ($9 billion), a reduction of only 7.3%, despite a significant impact of negative external factors (ruble price reduction - RUB 51 billion, additional fiscal load - RUB 69 billion), vs.H1 2015. EBITDA margin upturn was 1.6 p.p. or 26.5% in comparison with H1 2015.
In Q2 2016, Rosneft net profit was RUB 89 billion, or 6.4x times higher than in Q1 2016. Net profit increase resulted, primarily, from a material growth in operating profit.
CAPEX in Q2 2016 remained at the Q1 2016 levels at RUB 154 billion ($2.3 billion).
CAPEX increase in H1 2016 against H1 2015 made 14,5%. Upstream CAPEX grew by 33%, mainly driven by higher volumes of development drilling and intensification of greenfields development.
Investments are expected to increase in H2 2016 due to seasonal factors. The growth in spending is expected at above 30% this year.
In H1 2016 free cash flow amounted RUB 141 billion ($2.8 billion). The Company keeps generating a significant positive free cash flow, ensuring creation of value for the shareholders in quite volatile market conditions.
Working capital temporarily increased in Q2 2016 due to ruble oil prices rise (receivables from the customers) and higher advance payments to the customs on the back of growing export duty rates and crude oil export volumes. ■