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Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek

Novatek · Feb 27, 2014 · 45 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. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 1
    Fourth Quarter and Full Year 2013 Operational and Financial Results Conference Call Mark A. Gyetvay, Chief Financial Officer and Member of the Board of Directors Moscow, Russian Federation 27 February 2014
  2. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 2
    Summary Highlights - 2013 Increase in revenues driven by higher natural gas and liquids prices and volumes: Natural gas sales increased by 43.7% Liquids sales increased by 36.8% EBITDA (excluding net gain (loss) on disposal of…
  3. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 3
    Operational Overview 4
  4. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 4
    Proved Reserves Base at Year-End R/P = 29 yrs. 16,000 R/P = 31 yrs. 1,200 R/P = 25 yrs. 14,000 Proved reserves (MMBOE) 12,394 12,537 1,000 Produced (MBOE/day) 12,000 10,000 9,393 800 7,788 8,082 8,000 600 4,831…
  5. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 5
    Net Hydrocarbon Production Natural Gas Production, mmcm Liquids Production, mt 56,469 61,216 Joint ventures Joint ventures Other 3,997 Khanchey Other Khanchey 3,753 Joint ventures Khanchey Khanchey Yurkharov Yurkharov…
  6. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 6
    Purovsky Plant & Sea Port Terminals Total volumes delivered: 4,862 mt Yurkharovskoye field: 2,711 mt East-Tarkosalinskoye and Khancheyskoye fields: 943 mt Purchases from our joint ventures: 1,170 mt Other: 38 mt Total plant output:…
  7. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 7
    Ust-Luga Complex Total volumes delivered: 1,905 mt 1,779 mt of gas condensate refined products were dispatched to Asia Pacific Region 1,425 mt to Europe 274 mt to South America 80 mt Liquids inventory reconciliation…
  8. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 8
    Liquids in Transit Yosu Goods in transit Goods in transit Goods in transit 31.12.2012 30.09.2013 31.12.2013 217 thousand tons 151 thousand tons 177 thousand tons 60 mt 78 mt 73 mt 53 mt 157 mt South Korea 124 mt…
  9. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 9
    Financial Overview 2013 vs. 2012 10
  10. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 10
    Summary Financial Results (RR billion) 298.2 297.5 211.0 210.2 41.3% 175.3 174.8 41.5% 121.8 95.2 85.4 79.8 69.5 56.7 28.0% 14.8% 2011 2012 2013 Total revenues Oil & gas sales Normalized EBITDA Normalized profit…
  11. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 11
    Another Record Year (RR million) 2013 2012 +/(-) +/(-)% Oil and gas sales 297,499 210,246 87,253 41.5% Total revenues 298,158 210,973 87,185 41.3% Operating expenses (192,761) (125,775) (66,986) 53.3% EBITDA (1 ) 159,440 95,106 64,334…
  12. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 12
    Total Revenues (RR million) Change due to price From July 2013, most of our stable gas Change due to volume condensate was condensate was sent sent as as raw raw material material feedstock feedstock to the Ust-Luga Complex for…
  13. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 13
    Market Distribution Sales Volumes Natural gas sales volumes, mmcm Liquids sales volumes, mt 5,438 64,152 58,880 4,203 40,806 69.3% 4,386 80.7% 57,021 88.9% 3,449 82.1% 0 18,074 30.7% 0 754 17.9% 1,052 19.3% 7,131…
  14. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 14
    Total Revenues Breakdown 2013 5% 11% 6% Natural gas 9% Naphtha 69% LPG 2012 3% 22% Stable gas condensate 7% Other 68% 15
  15. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 15
    Realized Hydrocarbon Prices (net of VAT and export duties) 2013 2012 +/(-) +/(-)% Domestic prices Natural gas end-customers, RR/mcm 3,366 2,821 545 19.3% Natural gas ex-field, RR/mcm 1,830 1,518 312 20.6% Stable gas condensate, RR/ton…
  16. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 16
    Operating Expenses (RR million and % of Total Revenues (TR)) 2013 % of TR 2012 % of TR Transportation expenses 103,245 34.6% 60,848 28.8% Taxes other than income tax 21,645 7.3% 16,846 8.0% Non-controllable expenses 124,890 41.9%…
  17. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 17
    Transportation Expenses (RR million) Change due to tariffs/distance Change due to volume 515 (455) 138 103,245 13,588 1,004 220 72 2,944 Other includes: Unallocated rail services; Oil products transportation; Insurance; and…
  18. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 18
    Taxes Other Than Income Tax Expense (RR million) Change due to tax rate Change due to production 4,286 120 21,645 (52) 36 (23) 16,846 432 2012 Natural Gas Property Other taxes 2013 gas condensate tax UPT tax The increase…
  19. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 19
    General and Administrative Expenses (RR million) 177 153 150 11,029 10,622 114 71 105 60 (423) Increase due to Increase primarily due to the compensatory payments Decrease due to significant commencement of a made in 2013 as a…
  20. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 20
    Materials, Services and Other Expenses (RR million) Increase due to an increase in electricity consumption by our production subsidiaries related to new energy-consuming projects, as well as a higher electricity rates 182 56 92…
  21. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 21
    Condensed Statement of Financial Position (RR million) 31 December 2013 31 December 2012 +/(-) +/(-)% Total current assets 82,426 58,243 24,183 41.5% Incl. Cash and cash equivalents 7,889 18,420 (10,531) -57.2% Total non-current assets…
  22. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 22
    Total Debt Maturity Profile (RR million) 53,758 The Group has available funds: 30,155 Syndicated term credit line facility 27,913 24,026 24,483 USD 430 mln until June 2014 9,911 ZAO UniCredit Bank USD 55 mln until August 2015…
  23. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 23
    Debt Structure Debt structure and maturities Net Debt (cash) evolution, RR million 157,732 RR million 2013 2012 114,067 Short-term debt 24,026 34,682 71,647 Including current portion of 9,911 34,682 long-term debt Long-term debt…
  24. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 24
    Financial Overview 4Q 13 vs. 3Q 13 25
  25. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 25
    Comparison of Quarterly Results (RR million) 4Q 12 1Q 13 2Q 13 3Q 13 4Q 13 Q-o-Q +/- % Y-o-Y +/- % Oil and gas sales 59,262 80,448 57,918 75,541 83,592 10.7% 41.1% Total revenues 59,438 80,565 58,030 75,648 83,915 10.9% 41.2% Operating…
  26. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 26
    Market Distribution Gas Sales Volumes (mmcm) 18,739 15,876 16,382 14,628 14,403 11,554 72.8% 16,632 88.8% 14,453 88.2% 88.9% 13,008 12,928 89.8% 4,322 27.2% 2,107 11.2% 1,620 11.1% 1,475 10.2% 1,929 11.8% 4Q 12 1Q…
  27. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 27
    Natural Gas Sales Volume Mix 100% 75% 57% 62% 65% 73% 76% 89% 89% 90% 88% 50% 25% 43% 38% 35% 27% 24% 11% 11% 10% 12% 0% 4Q 11 1Q 12 2Q 12 3Q 12 4Q 12 1Q 13 2Q 13 3Q 13 4Q 13 Ex-field End-customers 28
  28. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 28
    Market Distribution Liquids Sales Volumes (mt) 1,614 1,411 1,353 1,069 1,060 1,351 83.7% 1,097 1,137 80.6% 75.6% 81.1% 859 801 80.4% 0 0 0 0 0 16.3% 24.4% 18.9% 19.4% 210 19.6% 263 259 256 274 4Q 12 1Q 13 2Q 13 3Q 13 4Q 13…
  29. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 29
    Total Revenues (RR million) Change due to price Change due to volume 421 194 (133) (950) (142) 83,915 705 (3,620) 579 40 216 75,648 4,058 6,899 In 3Q 13 we exported 207 mt of SGC, while in 4Q 13 substantially all of SGC was…
  30. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 30
    Total Revenues Breakdown 4Q 13 7% 7% Natural gas 19% Naphtha 67% LPG 3Q 13 6% 7% 6% Stable gas condensate 15% Other 66% 31
  31. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 31
    Realized Hydrocarbon Prices (net of VAT and export duties) 4Q 12 4Q 13 +/(-) +/(-)% 3Q 13 4Q 13 +/(-) +/(-)% Domestic prices 2,993 3,610 617 20.6% Natural gas end-customers, RR/mcm 3,659 3,610 (49) -1.3% 1,644 2,063 419 25.5% Natural…
  32. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 32
    Operating Expenses (RR million and % of Total Revenues (TR)) 4Q 12 % of TR 4Q 13 % of TR 3Q 13 % of TR 4Q 13 % of TR 17,199 28.9% 26,092 31.1% Transportation expenses 25,064 33.1% 26,092 31.1% 4,452 7.5% 6,534 7.8% Taxes other than…
  33. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 33
    Transportation Expenses (RR million) Change due to tariffs/distance Change due to volume (1,561) (41) (52) 26,092 25,064 69 156 20 37 Other includes: 2,400 Unallocated rail services; Oil products transportation; Insurance;…
  34. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 34
    Taxes Other Than Income Tax Expense (RR million) Change due to tax rate Change due to production 556 19 0 4 (3) 6,534 5,958 3Q 13 Natural Gas Property Other taxes 4Q 13 gas condensate tax UPT tax The increase in UPT…
  35. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 35
    General and Administrative Expenses (RR million) Increase due to consulting services provided to our production entities 133 25 3,742 5 56 218 6 663 26 Increase primarily due to the commencement of a sponsorship contract for…
  36. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 36
    Materials, Services and Other Expenses (RR million) Decrease was consistent with our ongoing maintenance schedule 78 117 2,491 157 60 (58) 2,248 (111) Increase due to an increase in Increase due to: electricity consumption by…
  37. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 37
    Questions and Answers 38
  38. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 38
    Appendices 39
  39. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 39
    Profit Attributable to NOVATEK Shareholders (RR million) 87,185 (19,790) 37,709 684 1,993 (9,670) 44 110,006 (10,411) (42,397) (4,799) 69,458 2012 Total OPEX Transport Taxes other Net gain on Other Finance Share of…
  40. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 40
    Maintaining Margins (% of total revenues) Disposal of a 20% participation interest in OAO Yamal LNG 86.3% 84.6% DisposalDisposal of a 51%ofequity a 51% stake equityinstake OAOinSibneftegas OAO 68.3% under Sibneftegas the…
  41. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 41
    Increasing Natural Gas Production (mmcm per day) Feb Feb Feb Feb Jun Jun Jun Jun May Nov May May Nov May Nov Sep Sep Nov Sep Sep Jul Jul Jul Jul Aug Oct…
  42. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 42
    Net Production Y-o-Y and 2012/2013 Quarterly Natural gas production, mmcm 61,216 9,002 56,469 5,962 Increase in Y-o-Y and Q-o-Q production primarily due to an increase in net production of our joint ventures and ongoing…
  43. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 43
    Net Production Y-o-Y and 2012/2013 Quarterly Liquids production, mt 4,751 424 4,270 77 746 517 Increase in Y-o-Y and Q-o-Q primarily due to an increase in net production of our joint ventures, as well as an increase in crude…
  44. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 44
    Change in Inventories 3,500 600 3,000 Natural gas volumes, mmcm 500 2,500 Liquids volumes, mt 400 2,000 300 1,500 200 1,000 100 500 0 0 01.01.13 31.03.13 30.06.13 30.09.13 31.12.13 Natural gas Liquid…
  45. Q4 AND FULL YEAR 2013 EARNINGS CALL – Novatek – slide 45
    Internally Funded Investment Program 30,000 4.0 20,000 3.0 Operating CF / CAPEX 10,000 2.0 RR millions - 1.0 (10,000) 0.0 (20,000) (1.0) 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 2011 2011 2011 2011 2012 2012 2012…

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