Q2 2004 Results Record profits - momentum maintained 13 August 2004
Internal strengthening supports Q2 results z The highest net profit in the companys history* - PLN 668 m z ROACE 20.2%** WACC 9.4% z PLN 163 m savings in Q2 04 due to cost cutting programme z Increase in wholesale volume by 12.7%***…
Q2 performance exceeds 2006 targets Favourable market conditions ROACE* 18% 15% ROACEreported exceeded 12% WACC by over 7pp in 1H 04 9% WACC 6% 3% ROACE 0% WACC 2001 2002 2003 1H '04 ROACE** ROACE Value streams Q2 04 2006…
Operating cost reduction in PKN ORLEN Q2 04 plan fully realised In m PLN 800 Savings (sustainable) Investments and M&A (one-offs) 450-500 450-500 XX* 306* 163* XX* One-off spending - M&A -13 -20 -46 - - Implementation…
Refining and wholesale still the main contributor to revenues In m PLN Revenue* Q2 04 Q2 03 Q104 Retail 3 030 2 883 2 473 Germany 1 764 1 797 1 476 Wholesale 3 362 2 210 2 724 Germany 481 - 451 Pet-chem 869 724 953 All revenues…
All segments delivered higher profitability In m PLN Operating profits Q2 04 Q2 03 Q1 04 Gross profit 1 523 1 002 1 213 Admin. expenses -235 -250 -184 Distribution costs -525 -571 -542 Cost cutting programme visible in 8% reduction…
Net profit cost-cutting and utilisation of favourable market conditions drive profitability In m PLN Q2 03 Q2 04 21* 18 800 9 700 -12** -8 -82 0 600 500 562 400 668 300 200 0 100 160 0 EBIT one-off items one-off items net…
Operating CF organic CAPEX Efficient cash flow management Operating CF PLN 1,040 m*** Decrease in 425% debt Purchase of PLN 344 m assets PLN 16 m * Dividend and interest PLN 12 m 140 120 Organic 100 R&M investment 80…
Refining Visible improvement in operating efficiency In m PLN Q2 03 Q2 04 116 700 76 600 0 6 59 500 -22 400 -63* 235 88 654 300 Significant internal improvements 200 0 100 159 0 exchange other local pricing…
Retail Cost-cutting drives profitability In m PLN Q2 03 Q2 04 47 90 Strong margins in 2Q 03 due to Iraq war 80 -4 70 8 60 3 3 50 0 40 30 -43 0 53 20 39 10 0 Germany volume cost-cutting fuel margin non-fuel…
Petrochemicals Strong profitability in face of expansion in polyolefins In m PLN Q2 03 Q2 04 26 120 4 0 8 26 100 80 0 13 60 117 82 -42* 40 Cost-cutting and strong 20 PVC and fertiliser margins - drivers of profitability…
Implementation of operating targets after Q2 04 Promise 2004 Result 1H04 Cost-cutting exceeding PLN 450 m in 04, expectations Cost cutting PLN 800 m by 05 9 PLN 306 m reflected in strong profitability sales total sales volume*…
Strategic milestones internal strengthening z Implement necessary management processes to increase efficiency and prepare the company for expansion steps z Reduce the headcount z Restructure the Capital Group - sale of non-core…
Challenges in H2 04 z Face the challenges of growing competition z Take advantage of pick up in domestic economy as well as favourable Oil & Gas environment z Maintain market share in retail z Accelerate investment process in retail…
Supporting slides Market environment 15
Market environment in oil & gas sector Favourable conditions utilised Crude oil price, Brent (USD/b) Q2 04 vs Q2 03 37 Crude oil 35.7% (y-o-y) 32 35.7% to 35.35 USD/b 27 22 Refinery margin 138.4% (y-o-y) Margin* Refinery margin,…
Market environment Poland Noticeable recovery in the economy Real GDP growth 7,0% 6.0E% z Visible increase of GDP proves 6,0% stable economic recovery. High 5,0% unemployment rate continues 4,0% 19.5% (fall of 0.2pp, y-o-y 3,0% vs.…
Supporting slides Cost cutting programme 18
Positive influence of cost cutting programme on Q2 04 results In PLN m PLN 163 m 23 57 7 42 133 64 Production & Logistics Savings Other Implementation Savings on Technology achieved in costs costs EBIT level in…
Supporting slides ORLEN Deutschland 20
ORLEN Deutschland Performance better than market in volume sales Trends in Q2 04 : Increase of retail margin by 35% q-o-q has positive effect on ORLEN Deutschland results Total volume of sales increased by 4.7%, due to substantial…
ORLEN Deutschland Financial highlights Q2 04 Balance sheet - selected items Change Change Q2 '04 Q2 '03 Q1 '04 IFRS basis, in PLN m Q2'04/Q2'03 Q2'04 /Q1 '04 Property plant and equipement 767 597 28,4% 807 -5,0% Inventories 131 109…
Supporting slides Other data 23
Operating highlights Increase of utilisation and reduction of headcount change change IFRS basis, in PLN m Q2 '04 Q2 '03 Q1 '04 y-o-y q-o-q Total sales, of w hich 3 548 3 407 4,1% 3 306 7,3% - light product sales (tt) ** 2 426 2 298…
Profit result of restructuring reflected in net profit change change IFRS basis, PLN m Q2 '04 Q2 '03 Q1 '04 y-o-y q-o-q Revenues* 7 406 5 933 24,8% 6 325 17,1% Cost of sales* -5 883 -4 931 19,3% -5 112 15,1% Distribution costs…
Balance sheet Low gearing future M&A payments fully secured change change IFRS basis, in PLN m Q2 '04 2003 Q1 '04 Q2'04/2003 Q2'04/Q1'04 Non current assets 10 656 10 715 -0,6% 10 684 -0,3% Current assets, of which 7 475 6 434 16,2% 6…
Refining and wholesale Excellent performance of the segment Refining and wholesale IFRS basis,PLN m Q2 '04 Q2 '03 Q1 '04 Revenue 5 291 3 457 3 958 311% y-o-y Total costs 4 637 3 298 3 534 Increase in profits of the of the segment…
Retail segment Increasing profitability of the segment Retail IFRS basis,PLN m Q2 '04 Q2 '03 Q1 '04 Revenue 3 037 2 984 2 478 Total costs of the segment 2 984 2 945 2 497 35.9%, y-o-y Profit of Increase in profit of the retail 53 39…
Petrochemical segment Profitability on a satisfactory level Petrochemicals IFRS basis,PLN m Q2 '04 Q2 '03 Q1 '04 Revenue 1 220 1 039 1 270 42.7%, y-o-y Total costs Increase in segments profit 1 103 957 1 068 of the segment mainly due…
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