IFRS FINANCIAL AND OPERATING RESULTS FOR THIRD QUARTER 2013 12 November 2013, St. Petersburg
AGENDA Highlights, Alexey Yankevich Macro Member of the Management Board, Environment, CFO Financials Upstream Mihail Zhechkov Head of Economics and Investment Department, Exploration and Production Division Downstream…
HIGHLIGHTS 9M 2013 Financial Performance: Revenue: RUB 938 bln (+2.6% Y-o-Y) EBITDA*: RUB 252 bln (+2.9% Y-o-Y) Net Income: RUB 135 bln (+0.4% Y-o-Y) Operational Progress in 9M 2013: Hydrocarbon production up 4% Y-o-Y Refining…
Upstream Major projects and new technologies deliver production growth IFRS FINANCIAL AND OPERATING RESULTS FOR THIRD QUARTER 2013 5
CONTINUED NEW OPPORTUNITIES IN LEGACY FIELDS 9M 2013 Key Events: Exploration: Tight Oil Testing continues on Bazhenov formation at Palyanovskaya acreage of Krasnoleninskoye field Exploratory drilling identified Jurassic layer crude…
BROAD-BASED PRODUCTION GROWTH DRIVES INDUSTRY LEADERSHIP IN 9M2013 Peer Comparison: Hydrocarbon Production 3Q 2013 vs 3Q 2012 Reconciliation Increase in Russia*, 9M 2013 vs 9M 2012, % Gazprom Neft Bashneft Lukoil Rosneft…
NEW TECHNOLOGIES DELIVER IMPROVED RESULTS Multi-Stage Hydrofracking Horizontal Wells Drilled, units 164 Commissioned horizontal well at Vyngapurovskoye +228% field (first Group 10-stage hydrofrac) Well depth 4,500m; horizontal…
NEW UPSTREAM PROJECTS DEVELOPMENTS UPDATE Partnership with Shell Chonskiy Si (KMPA) Kuyumba Dolginskoye Iraq (Kurdistan) Completed 3D seismic Signed partnership agreement Conducted seismic Approved oil spill A new world 3D field…
NEW UPSTREAM PROJECTS DEVELOPMENTS UPDATE Iraq Iraq (Badra) (Badra) Completed testing of well Bd-4 Completed oil export pipeline linear section construction Messoyakha ZPEC chosen as contractor to drill Finalized the concept for…
NOVOPORT: TRANSPORTATION PLAN APPROVED Transportation: pipeline marine terminal near Cape Kamenny Standard tankers Murmansk seaport (using purpose-built tankers) customs control Purpose-built shuttle tankers, Arc6 ice class Transport…
DRILLING THE FIRST WELL AT ARCTIC OFFSHORE Located on the Pechora Sea shelf 60 km offshore (village of Varandey, Nenets Autonomous Area) Sea depth in the field location: 19-20 m Development time frame: 25 years Well stock: 36 wells…
Downstream Rising product quality, growth in premium channels IFRS FINANCIAL AND OPERATING RESULTS FOR THIRD QUARTER 2013 13
PRICES OF CRUDE OIL AND PETROLEUM PRODUCTS GROW IN THIRD QUARTER /bbl Crude oil prices /bbl Gazprom Neft average netbacks Domestic product wholesale prices change Domestic product retail prices change +6% Regular Gasoline (92)…
85% OF OWN CRUDE IS PROCESSED IN HIGH QUALITY COMPANY REFINERIES Crude distribution, Change 3Q 2013, Y-o-Y MMTonnes Y-o-Y 1.60 MMTonnes -50% Crude purchases 12.82 0% MMTonnes Omsk -11% Crude production Refinery 76%…
CONVERTING GROUP REFINERIES TO ADVANCED OIL PROCESSING CENTERS Licensor FEED Operational Equipment Construction Base Project choice development documentation delivery &installation Deep oil processing unit* Omsk CDU/VDU unit…
EXPANDING RETAIL SALES IN THIRD QUARTER Retail sales in 3Q 2013: Russia and CIS 2.2 MMTonnes +13% Y-o-Y Balkans 0.2 MMTonnes +24% Y-o-Y Throughput per station in Russia reached 19.7 tpd in 3Q 2013, 6.6% growth Y-o-Y Non-oil sales…
RETAIL GASOLINE AND DIESEL SALES GROWTH OUTPERFORMS RUSSIAN AVERAGE Russia +4.0% +3.3% +9.7% + 13.3% Gazprom neft Gasoline sales growth drivers: Diesel sales growth drivers: Retail chain rebranding Retail chain…
SUBSTANTIAL INTERNATIONAL EXPANSION IN PREMIUM CHANNELS Aviation Bunkering 9M 2013 Key events: 9M 2013 Key events: Expanded global presence to 117 airports in 44 countries Finalized acquisition of Estonian bunkering operator AS…
EXPANDING MARKET SHARE DRIVES VOLUME GROWTH Lubricants Bitumen 9M 2013 Key events: 9M 2013 Key events: Sales of G-Family products grew by 32% Y-o-Y Began production at bitumen plant in Kazakhstan Began deliveries to Libya,…
BRAND DEVELOPMENT DRIVES CUSTOMER LOYALTY AND SALES GROWTH Leading retail brand Premium fuel products portfolio Leading positions in Russia: G-Drive fuel sales Brand awareness 2 (85%) outperformed business Intention-to-use 1 (47%)…
Financials Substantial income growth Q-o-Q; modest improvement Y-o-Y IFRS FINANCIAL AND OPERATING RESULTS FOR THIRD QUARTER 2013 22
SUBSTANTIAL INCOME GROWTH Q-O-Q; MODEST IMPROVEMENT Y-O-Y Revenue grew 2.6% Y-o-Y on higher +2.6% hydrocarbon production volumes and increased sales through premium Revenues channels, partially offset by lower RUB bln crude oil…
EBITDA RECONCILIATION 9M 2013 VS. 9M 2012 EBITDA 9M 2013 vs 9M 2012, RUB mln 251,919 244,894 IFRS FINANCIAL AND OPERATING RESULTS FOR THIRD QUARTER 2013 24
EBITDA RECONCILIATION 3Q 2013 VS. 2Q 2013 EBITDA 3Q 2013 vs 2Q 2013, RUB mln 101,352 73,874 IFRS FINANCIAL AND OPERATING RESULTS FOR THIRD QUARTER 2013 25
STRONG FREE CASH FLOW GENERATION RUB million Cash Flow Reconciliation 9M 2013 * Projects that are not consolidated under IFRS IFRS FINANCIAL AND OPERATING RESULTS FOR THIRD QUARTER 2013 26
INVESTMENTS SUPPORT STRATEGIC GOALS AND UPSTREAM PRODUCTION IN MATURE FIELDS Investments (RUB mln) 23% Y-o-Y growth in brownfield capex due +16% 143,403 to increase in use of new technologies in legacy fields 9,602 123,149 5,521…
CONTINUED IMPROVEMENTS IN BALANCE SHEET AND DEBT PORTFOLIO 0.3% 19.4% USD RUB 47.5% Euro Other 32.8% Net debt/EBITDA 0.46x vs.…
Questions & Answers IFRS FINANCIAL AND OPERATING RESULTS FOR THIRD QUARTER 2013 29
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