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INVESTOR PRESENTATION – PKN Orlen SA

PKN Orlen SA · Jun 4, 2007 · 36 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. INVESTOR PRESENTATION – PKN Orlen SA – slide 1
    PKN ORLEN - Maeiki Nafta Value Creation Program Creating a regional leader in Central and Eastern Europe Piotr Kownacki, President of the Management Board, CEO Pawe Szymaski, Deputy President of the Management Board, CFO Krystian Pater,…
  2. INVESTOR PRESENTATION – PKN Orlen SA – slide 2
    Maeiki Nafta acquisition significantly strengthens PKN ORLEN Group position in Central and Eastern Europe Acquisition Successfully finalized on December 15th, 2006 completed Dominant majority of 90% controlled by PKN ORLEN Consistent…
  3. INVESTOR PRESENTATION – PKN Orlen SA – slide 3
    Agenda Overview of Overview ofthe theMaeiki MaeikiNafta Naftatransaction in the transaction context in the of PKN context ORLEN of PKN strategy ORLEN execution strategy execution Value Creation Program at Maeiki Nafta…
  4. INVESTOR PRESENTATION – PKN Orlen SA – slide 4
    Maeiki Nafta transaction perfectly fits into Pillar 3 of PKN ORLEN strategy Strategy Acquisition of Change of corporate culture remedy the situation within the Company Maeiki Nafta Partnership Program efficient integration of…
  5. INVESTOR PRESENTATION – PKN Orlen SA – slide 5
    PKN ORLEN is the major shareholder of Maeiki Nafta holding 90% stake Yukos 53.60%(1) International USD 1,492.0 million y On December 15th, PKN ORLEN purchased a 84.36% stake in Maeiki Nafta for USD UK B.V. 2.34 billion, making it the…
  6. INVESTOR PRESENTATION – PKN Orlen SA – slide 6
    Financing the Maeiki Nafta transaction Sources of financing for 100% of the Maeiki Nafta acquisition Refinance the bridge loan In USD million y Eurobond issue 3 000 PKN ORLEN intends to Including funds from refinance the Bridge…
  7. INVESTOR PRESENTATION – PKN Orlen SA – slide 7
    Maeiki Nafta is being integrated into PKN ORLENs segment-based management Key principles of a new management model Segment based management overview Joint management of PKN ORLEN Group main assets: PKN ORLEN, One Maeiki Nafta and…
  8. INVESTOR PRESENTATION – PKN Orlen SA – slide 8
    Agenda Overview of the Maeiki Nafta transaction in the context of PKN ORLEN strategy execution Value Creation CreationProgram ProgramatatMaeiki MaeikiNafta Nafta targets & initiatives targets by segment & initiatives by…
  9. INVESTOR PRESENTATION – PKN Orlen SA – slide 9
    Phases of Value Creation Program at Maeiki Nafta Phase Process Timeline Actions 2007 2008 2009 2010 2011 2012 Restore production to full capacity Bitumen vacuum unit not used for last 20 years was put into operations to reduce…
  10. INVESTOR PRESENTATION – PKN Orlen SA – slide 10
    Ensuring Business Continuity is the key priority for Maeiki Nafta Disruption in crude oil deliveries by Incident Fire at Maeiki Nafta refinery Druzhba pipeline Date y October 12th, 2006 y July 29th, 2006 Action Status Action…
  11. INVESTOR PRESENTATION – PKN Orlen SA – slide 11
    Maeiki Nafta 2012E EBITDA(1) increase of USD 650 million versus 2007E from business continuity recovery and Value Creation Program EBITDA under constant macro scenario(1) In USD million 800 727 700 200 600 500 400 250 319…
  12. INVESTOR PRESENTATION – PKN Orlen SA – slide 12
    Phase 1: Maeiki Nafta Efficiency Improvement aim to increase 2012E EBITDA by USD 250 million Key activity Key value creation levers EBITDA 2012E impact(1) In USD million % of the total VCP In USD million Increase white product…
  13. INVESTOR PRESENTATION – PKN Orlen SA – slide 13
    Business Recovery & Continuity & Phase 1: Capex requirement for delivery of Efficiency Improvement Project group Major investments Benefits Capex 2007E-2012E(1) included Rebuilt VDU In USD million % of the total VCP CAPEX Ensure…
  14. INVESTOR PRESENTATION – PKN Orlen SA – slide 14
    Phase 2: The New Investment Program for Maeiki Nafta Key value EBITDA 2012E(1) Impact Initiative example creation projects In USD million % of the total VCP Increase refining conversion ratio up to 90% Hydrocracking Increase the…
  15. INVESTOR PRESENTATION – PKN Orlen SA – slide 15
    Phase 2: Capex required for the New Investment Program for Maeiki Nafta Project group Major investments Benefits Capex 2007E-2012E(1) included In USD million % of the total VCP CAPEX Clean Power plant including flu gas…
  16. INVESTOR PRESENTATION – PKN Orlen SA – slide 16
    Total Value Creation: Maeiki Nafta 2012E EBITDA(1) increase of USD 650 million versus 2007E EBITDA under constant macro scenario(4) In USD million 800 Business VCP: Efficiency Continuity improvement 31% 38% CAGR 57% p.a. 200 250…
  17. INVESTOR PRESENTATION – PKN Orlen SA – slide 17
    Total Maeiki Nafta 2007E - 2012E capex Capex of USD 1.6 billion planned for Maeiki Nafta (2007E - 2012E)(1) In USD million New Business 500 Investment Continuity Program 300 19% 450 47% 400 750 400 370 550 350 330 Efficiency…
  18. INVESTOR PRESENTATION – PKN Orlen SA – slide 18
    Agenda Overview of the Maeiki Nafta transaction in the context of PKN ORLEN strategy execution Value Creation Program at Maeiki Nafta targets & initiatives by segment PKN ORLEN strategy strategyexecution executionofof 2009E…
  19. INVESTOR PRESENTATION – PKN Orlen SA – slide 19
    PKN ORLEN delivery on strategic objectives and key targets of the strategy 2006 2009E Strategic objectives Delivery as of 2006 (1) Key targets 2009E(1) y EBITDA(2) PLN 7 billion y PLN 10 billion Organic Implement Efficiency…
  20. INVESTOR PRESENTATION – PKN Orlen SA – slide 20
    Ongoing strategy implementation Progress on other initiatives during 2006 Progress on other initiatives during 2006 y Unipetrol: Ongoing integration and efficiency gains achieved within Unipetrol (Partnership Program) EUR 109…
  21. INVESTOR PRESENTATION – PKN Orlen SA – slide 21
    PKN ORLEN dividend policy PKN ORLEN approach to the dividend policy y Dividend policy Taking into account mergers and acquisitions Allowing for maintaining the optimal capital structure determined by the following ratios…
  22. INVESTOR PRESENTATION – PKN Orlen SA – slide 22
    Total Value Creation Program EBITDA and capex impact for Maeiki Nafta to 2007E - 2012E EBITDA 2012E(1) VCP capex 2007E - 2012E(1) In USD million % of the total In USD million % of the total Business 38% 19% Continuity (2) 200 300…
  23. INVESTOR PRESENTATION – PKN Orlen SA – slide 23
    Thank you for your attention For more information please contact the IR Department: phone: + 48 24 365 33 90 fax: + 48 24 365 56 88 e-mail: irorlen.pl www.orlen.pl 24
  24. INVESTOR PRESENTATION – PKN Orlen SA – slide 24
    Agenda Overview of the Maeiki Nafta transaction in the context of PKN ORLEN strategy execution Value Creation Program at Maeiki Nafta targets & initiatives by segment PKN ORLEN strategy execution of 2009E financial/operational…
  25. INVESTOR PRESENTATION – PKN Orlen SA – slide 25
    Main PKN ORLEN macroeconomic assumptions June 2007 vs January 2006. Part 1/2 Benchmark refining margin (USD/bbl)(1) Brent/Ural differential (USD/bbl) Forecast as of June'07 Forecast as of June'07 6,0 Forecast as of Jan'06 5,0…
  26. INVESTOR PRESENTATION – PKN Orlen SA – slide 26
    Main PKN ORLEN macroeconomic assumptions June 2007 vs January 2006. Part 2/2 Gasoline crack margin (USD/ton) Diesel crack margin (USD/ton) 150 Forecast as of June'07 Forecast as of June'07 141 Forecast as of Jan'06 160 Forecast as of…
  27. INVESTOR PRESENTATION – PKN Orlen SA – slide 27
    Refining Efficiency Improvement Phase 1.1. Key value Initiative examples Potential(1) creation levers Install valves before pressure safety relief valves Recover hydrogen and LPG flare gas Control automatic level for separator in…
  28. INVESTOR PRESENTATION – PKN Orlen SA – slide 28
    Efficiency Improvement in wholesale and logistics Phase 1.2. Key value Initiative examples Potential(1) creation levers Increase diesel and LPG sales to Poland Increase bitumen sales to Estonia Improve Develop partnership in fuel…
  29. INVESTOR PRESENTATION – PKN Orlen SA – slide 29
    Efficiency Improvement in retail Phase 1.3. Key value Initiative examples Potential(1) creation levers Develop retail Expand Ventus retail network in Lithuania and enter Latvia via network in the USD 25 million greenfield…
  30. INVESTOR PRESENTATION – PKN Orlen SA – slide 30
    Efficiency Improvement in corporate and other Phase 1.4. Key value Initiative examples Potential(1) creation levers Optimise chemicals purchasing Optimise Optimise indirect purchasing purchasing USD 5 million spend Optimise…
  31. INVESTOR PRESENTATION – PKN Orlen SA – slide 31
    Integration of Maeiki Nafta is a key step on the way to leadership in the CEE region 2006 data Maeiki Nafta Processing capacity Retail network (in million tons p.a.) (Number of stations) ORLEN Total: ORLEN Total: 19,9 10,0 2 728 34…
  32. INVESTOR PRESENTATION – PKN Orlen SA – slide 32
    Acquisition of Maeiki Nafta strengthens the asset base, competitive position and financial standing of PKN ORLEN in the region Enlarged PKN ORLEN Group aims at equalising its value with the main regional competitors Asset value (USD…
  33. INVESTOR PRESENTATION – PKN Orlen SA – slide 33
    Maeiki Nafta focus on high growth markets Real GDP growth(1) Vehicleownership Vehicle ownership growth(2) 1 growth GDP growth in % Vehicles / 1000 popn 585 10 9.0 8.8 600 7.9 500 500 460 475 8 500 408 380 380 5.8 5.9 6.1 400…
  34. INVESTOR PRESENTATION – PKN Orlen SA – slide 34
    Maeiki Nafta is the only refinery in Baltic states and one of the largest most sophisticated refineries in the CEE region Geographical overview of refineries in CEE Major refineries in CEE(1) Maeiki Nafta refinery overview Refining…
  35. INVESTOR PRESENTATION – PKN Orlen SA – slide 35
    Maeiki Nafta refining volumes and margins Refining capacity and throughput Variable Margin Evolution after fire Capacity 40 in million USD 34,9 In million tons p.a. 28 Throughput 30 21 21,6 24 20 10 4,2 10,2 11,0 10,3 8,0 0 -10…
  36. INVESTOR PRESENTATION – PKN Orlen SA – slide 36
    Maeiki Nafta product yield significant improvement following investment Product yield pre-investment (2006) Product yield post-investment (2012) Other Other LPG LPG Jet fuel Gasoline 3 Gasoline 5 5 3 6 Jet fuel 29 Fuel 29 8…

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