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IFRS Results Q4 and FY 2017 – Rosneft Oil Company

Rosneft Oil Company · Feb 27, 2017 · 39 slides

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Slides

  1. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 1
    Rosneft Oil Company IFRS Results Q4 and 12M 2016 February 27, 2017
  2. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 2
    Macroeconomic Environment Indicator 2016 2015 % Q4 16 Q3 16 % Urals, /bbl 42.1 51.4 (18.2)% 48.3 44.0 9.7% Urals, 000 RUB/bbl 2.82 3.14 (10.0)% 3.05 2.85 7.0% Naphtha, 000 RUB/ton 24.95 26.86 (7.1)% 26.91 23.93 12.5% Gasoil…
  3. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 3
    Overview of Key Developments Seismic activity jumped by over 50% while the license obligations were exceeded more than two times Exploration 13 fields and 127 new deposits were discovered with 11+22 reserves of 207 mmtoe1.…
  4. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 4
    Overview of Key Developments Fuel oil output at Russian refineries cut by 14.9% while Euro-5 motor fuels production increased by 55.6% Refining Light product yield rose by 1.3 p.p. to 56.6%, refining depth improved by 5.5 p.p. to…
  5. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 5
    Successful Completion of the Integrated Privatization Deal 1 The largest privatization deal in the Russias modern history the total effect for the government exceeding 17 bn 17 bn1 2 Sale of a 19.5% stake at premium multiples…
  6. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 6
    Bashneft Integration Assets operating highlights1 Expected synergies3,4 Indicator Value 4 bn Proved PRMS reserves2 2.3 bn bbl 3 Oil production 19.9 mmt 0.5 Refining throughput 19.1 mmt 2 1.4 Nelson index 9.1 3.0 1 Light product…
  7. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 7
    Acquisition of 49% in Essar Oil Asset location Rosneft signed the Sale and Purchase Agreement for a 49% stake Arabian Sea in Essar Oil Limited (EOL). 100% of EOLs business was valued at Sea Airport 12.9 bn1 tank farm Reliance…
  8. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 8
    Acquisition of up to 35% in the Concession Agreement for the Development of the Zohr Gas Field Location Cyprus Rosneft signed a binding agreement to acquire a 30% Mediterranean stake in the concession for the development of the…
  9. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 9
    Upstream Portfolio Optimization Attracting partners in the current projects: Vankor VCNG Taas-Yuryakh Partner: ONGC (26%), pool of Indian investors Partners: Beijing Enterprises (20%) Partners: BP (20%), consortium of Indian Vankor…
  10. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 10
    Key Operating Highlights Indicator 2016 2015 % Comment SEC proven hydrocarbon Stable reserve replacement. Reserve replacement ratio at reserves 37,772 34,465 +9.6% 148%1,2 mmboe Hydrocarbon production, incl 5,369 5,159 +4.1% Record…
  11. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 11
    Key Financial Highlights Indicator 2016 2015 % Q4 16 Q3 16 % EBITDA, RUB bn 1,278 1,245 2.7% 365 292 25.0% Net income, RUB bn 181 355 (49.0)% 52 26 100.0% Attributable to Rosneft shareholders Adjusted net income1, RUB bn 448 479…
  12. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 12
    Operating Results
  13. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 13
    Exploration & Reserves Reserves1 Key achievements for 2016 mmboe 2D and 3D seismic works increased by over 58% vs. 2015. Offshore works exceeded license obligations by more than 2 908 times 1,741 79% - onshore exploration drilling…
  14. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 14
    Development Drilling Development drilling footage Key achievements for 2016 th. m Development drilling footage rose by 35% with in-house service share exceeding 50% of the total workscope +35% Commissioning of new wells increased by…
  15. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 15
    Hydrocarbon Production kboed +4.1% 113 71 7 11 2 16 (31) (20) 10 22 7 (6) 8 5,369 5,159 2015 Orenburg Samotlor Purneftegaz Samara Severnaya Yugansk North Chaivo Messoyakha Uvat Vankor Other Gas Bashneft 2016 Neft…
  16. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 16
    Commissioning new projects on schedule (Suzun, E. Messoyakha) Suzunskoye field East Messoyakhskoe field1 In September 2016 the Company started the On September 21, 2016 the northernmost onshore comprehensive testing of the oil…
  17. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 17
    Gas Business: organic production growth and efficient monetization Key achievements for 2016 Gas production Production growth by 7% following the commissioning bcm +4.56 of gas treatment facilities in Rospan and Purneftegaz, (+7%)…
  18. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 18
    Refining: modernization program progress Refining and production of motor fuels Key achievements for 2016 at Russian refineries Light product yield improvement from 55.3% to 56.6%, Refining throughput in, mmt Russia, refining…
  19. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 19
    Crude Oil and Petroleum Product Sales Netbacks of the main oil monetization channels Oil monetization structure (Q4 2016) Refining throughput Domestic market Exports Capacity utilization 0.0 89% 88% 90% 100% 87% 88% 85%…
  20. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 20
    Financial Results
  21. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 21
    Revenues 2016 vs 2015 RUB bn External factors: Company controlled factors: RUB -403 bn; -8% RUB +73 bn; +1% 382 (766) (26)1 2 168 11 (47) 17 97 5,150 4,988 2015 Exchange rate Crude oil price Number of days Exchange rate…
  22. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 22
    Operating Costs Dynamics Lifting costs Refining costs in Russia RUB/boe RUB/bbl 200 Bashneft effect Rosneft Costs 60% 180 Bashneft effect Rosneft Costs 172 60% Average LTM % YoY 180 Average LTM % YoY 166 150 165 164 164 170 153 150…
  23. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 23
    EBITDA and Net Income EBITDA 2016 vs 2015 RUB bn External factors: Company controlled factors: RUB -26 bn; -2% RUB +30 bn; +2% 184 (115) (213) 183 (50) 9 (14) 5 29 17 (32) 26 4 1,245 1,278 2015 Exchange rate Crude oil…
  24. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 24
    CAPEX CAPEX and production RUB bn kboed Further enhancement of the investment program in 2016, 1,200 6,000 overall CAPEX growth at +19%, Upstream spending increase at +33% (in line with the target), driven by: 900 start of an…
  25. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 25
    Sources & Uses of Cash Q4 2016 12M 2016 RUB bn RUB bn Funds available for debt management Asset disposal 258 409 Operating cash flow 357 Prepayments under LT crude oil and 303 petroleum product supply contracts 125…
  26. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 26
    Financial Stability Debt and net debt dynamics bn1 Cash, cash equivalents, ST financial assets and other Net debt increased by 5.1 bn in Q4 2016 due to the 70 8.0 acquisition of the controlling stake in Bashneft Net debt 60 Net…
  27. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 27
    Dividend Policy Dividend per share State controlled companies payout ratio (2015) CAGR 25% 14 12.9 12 3.7 10 8 6 9.21 35% 11,8 28% 4 8.1 8.2 24% 7.5 20% 2 9,21 2.8 9% 1.3 1.6 1.9 0 2007 2008 2009 2010 2011 2012 2013 2014…
  28. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 28
    Plans for 2017 Exploration & Reserve replacement at above 100% Production Oil and gas production growth Refining, Marketing Further optimization and efficiency improvement and Sales Efficiency Maintaining the controlled…
  29. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 29
    Appendix
  30. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 30
    Key Indicators (excl. Bashneft) Indicator 2016 2015 % SEC proven hydrocarbon reserves 35,425 34,465 +2.8% mmboe Hydrocarbon production, incl 5,256 5,159 +1.9% kboed Crude oil and NGL, 4,142 4,116 +0.6% kbpd Gas, 1,114 1,043…
  31. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 31
    Revenues Q4 2016 vs. Q3 2016 RUB bn External factors: RUB 59 bn; +5% 168 (7) 9 35 (29) 86 1,485 1,223 Q3 2016 Exchange rate Crude oil price Exchange rate effect Share in profits of Change in volumes Bashneft Q4 2016 from…
  32. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 32
    Operating Cost Dynamic 2016 vs 2015 Lifting costs RUB bn 12 (4) 6 11 Power supply costs increase (increase in tariffs and watercut) and overall OPEX growth due to higher HC 303 production was partially offset by reduction of 278…
  33. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 33
    EBITDA and Net Income EBITDA Q4 vs Q3 2016 RUB bn External factors: Company controlled and seasonal factors: RUB +39 bn; +13% RUB +5 bn; +2% 10 (4) (10) 29 (4) 10 (1) 26 9 (10) 18 365 292 Q3 2016 Exchange rate Crude oil…
  34. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 34
    FX Risk Hedge 2016, RUB bn 2015, RUB bn Net of income Net of income Before tax Profit tax Before tax Profit tax tax tax Recognized within other funds and (590) 118 (472) (498) 100 (398) reserves as of the start of the period…
  35. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 35
    Adjusted Operating Cash Flow Calculation Profit and loss statement Cash flow statement Indicator 2016, bn 2016, bn Indicator 1 Revenue, incl. 77.2 3.0 Net income 1 Adjustments to reconcile net income 12.6 2 to cash flow from…
  36. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 36
    Adjusted Operating Cash Flow Prepayments for crude oil supplies reimbursed (average FX rate) RUB 288 bn (4) 95 125 163 (709) 1,011 632 302 Net cash provided Prepayments for FX rate change Prepayments for…
  37. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 37
    Export Duty Lag RUB bn (43) 23 (62) (31) (14) 52 (2) 22 362 351 359 348 328 336 319 309 314 297 287 273 296 294 292 278 Q1 15 Q2 15 Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 Normalized EBITDA (excl. Bashneft) Actual EBITDA…
  38. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 38
    Financial Costs, RUB bn Indicator 2016 2015 % Q4 16 Q3 16 % 1. Interest accrued1 144 139 3.6% 40 34 17.6% 2. Interest paid 143 137 4.4% 35 37 (5.4)% 3. Change of interest payable (1-2) 1 2 (50.0)% 5 (3) 4. Change of interest…
  39. IFRS Results Q4 and FY 2017 – Rosneft Oil Company – slide 39
    EBITDA and Net Income Sensitivity Urals price change Exchange rate change RUB bn -12 /bbl +12 /bbl RUB bn -7 RUB/ +7 RUB/ EBITDA EBITDA (243) 243 (237) 237 Net income Net income (195) 195 (190) 190 Average Urals price…

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