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2Q2014 IFRS Consolidated Financial Results October 15, 2014 0 - - PowerPoint PPT Presentation
2Q2014 IFRS Consolidated Financial Results October 15, 2014 0 - - PowerPoint PPT Presentation
2Q2014 IFRS Consolidated Financial Results October 15, 2014 0 Alexander Ivannikov First Deputy Head of the Department for Finance and Economics 1 Disclaimers This presentation has been prepared by OJSC Gazprom (the Company), and
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Disclaimers
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This presentation has been prepared by OJSC Gazprom (the “Company”), and comprises the slides for a presentation to investors concerning the
- Company. This presentation does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or
subscribe for, any shares or other securities representing shares in the Company, nor shall it or any part of it nor the fact of its presentation or distribution form the basis of, or be relied on in connection with, any contract or investment decision. Any viewer of this presentation considering a purchase of such securities is hereby reminded that any such purchase should be made solely on the basis of the information contained in the prospectus or other offering document prepared in relation thereto and will be subject to the selling restrictions set out therein. No reliance may be placed for any purposes whatsoever on the information contained in this presentation, or any other material discussed at any presentation or on its completeness, accuracy or fairness. The information in this presentation should not be treated as giving investment advice. Care has been taken to ensure that the facts stated in this presentation are accurate, and that the opinions expressed are fair and
- reasonable. However, the contents of this presentation have not been verified by the Company. Accordingly, no representation or warranty, express or
implied, is made or given by or on behalf of the Company or any of its members, directors, officers or employees or any other person as to the accuracy, completeness or fairness of the information or opinions contained in or discussed at this presentation. None of the Company or any of their respective members, directors, officers or employees nor any other person accepts any liability whatsoever for any loss howsoever arising from any use of this presentation or its contents or otherwise arising in connection therewith. The information in this presentation includes forward-looking statements. These forward-looking statements include all matters that are not historical facts, statements regarding the Company’s intentions, beliefs or current expectations concerning, among other things, the Company’s results of
- perations, financial condition, liquidity, prospects, growth, strategies, and the industry in which the Company operates. By their nature, forward-looking
statements involve risks and uncertainties, including, without limitation, the risks and uncertainties to be set forth in the prospectus, because they relate to events and depend on circumstances that may or may not occur in the future. The Company cautions you that forward looking statements are not guarantees of future performance and that its actual results of operations, financial condition and liquidity and the development of the industry in which the Company operates may differ materially from those made in or suggested by the forward-looking statements contained in this presentation. In addition, even if the Company’s results of operations, financial condition and liquidity and the development of the industry in which the Company
- perates are consistent with the forward-looking statements contained in this presentation, those results or developments may not be indicative of
results or developments in future periods. The information and opinions contained in this presentation are provided as at the date of this presentation and are subject to change without notice. No person is under any obligation to update or keep current the information contained herein. By attending the presentation you agree to be bound by the foregoing limitations.
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Summary of Financial Results
2Q2014 vs. 2Q2013 Gazprom Group results
2Q2014 IFRS Consolidated Financial Results
- 1. Profit for the period attributed to owners of OAO Gazprom
- 2. Compared to Net debt as of December 31, 2013
2Q 2014 YoY
Total net sales 1,315 bn RR 19%
- Adj. EBITDA
281 bn RR
- 36%
Net Profit(1) 228 bn RR 13% Operating cash flow 298 bn RR
- 32%
Free cash flow 76 bn RR
- 47%
Net debt(2) 895 bn RR
- 20%
Net debt/Adj.EBITDA LTM 0.5x
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15,3 8,8 32,3 49,0 18,1 0,0 20,0 40,0 60,0 80,0 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 8,3 8,6 8,7 8,6 8,6 5 10 15 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 36,3 34,7 41,8 42,7 33,5 20 40 60 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 108,5 104,8 137,2 131,6 103,7 50 100 150 200 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 + 3.6 %
- 4 %
Natural Gas, bcm
Hydrocarbon Production, Electricity and Heat Generation
2Q2014 IFRS Consolidated Financial Results
Crude Oil, mln ton Gas Condensate, mln ton Electricity generation, bn kWh
- 7.7 %
Heat generation, mln Gcal
+ 18.3 %
Including Russian generating companies: Mosenergo, OGK-2, TGK-1
3,6 3,4 3,8 3,9 3,6 0,0 2,0 4,0 6,0 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 0 %
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Russian Natural Gas Balance
Bcm 2Q2013 2Q2014
Natural gas sources 164.2 164.4 Domestic gas production 152.1 151.5 Other sources including Central Asian and Azerbaijani gas 9.3 8.0 Gas withdrawn from underground storage in Russia, Latvia and Europe 1.9 3.0 Decrease in the amount of gas within the gas transportation system 0.9 1.9 Natural gas distribution 164.2 164.4 Domestic consumption 90.9 90.3 including needs of the gas transportation system and underground storages 8.3 7.5 Gas pumped into underground storages 23.3 17.0 Gas for LNG production 3.3 3.5 Foreign supplies (including the Baltic States) 38.3 39.1 FSU supplies (including the Republic of Ossetia and Georgia) 7.7 12.9 Increase in the amount of gas within the gas transportation system 0.7 1.6
2Q2014 IFRS Consolidated Financial Results
Source: Company operating data
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58 110 131 127 136 50 100 150 200 250 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 396 400 458 484 399 100 200 300 400 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014
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Gas Sales
Net sales(1)
RR bn
Calculations may diverge due to rounding.
- 1. Net of value added tax (VAT); 2. Other countries include LNG sales to Argentina, China, Japan, Korea, Nigeria and Vietnam;
- 3. VAT is not charged on sales to FSU, Europe and other countries; 4. Net of custom duties; 5. Gross average price including custom duties
2Q2014 IFRS Consolidated Financial Results
Net sales(3,4)
Gas Sales in Europe and Other Countries(2) Gas Sales in Russia
Net sales(3,4)
Gas Sales in FSU Countries
RR bn RR bn 43 37 73 85 41 3015 3386 3551 3535 3470 1 000 2 000 3 000 4 000 20 40 60 80 100 120 140 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 RR/mcm bcm
Volumes and prices(5)
40 41 48 47 39 381 380 375 372 358 100 200 300 400 30 60 90 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 US$/mcm bcm 9 15 17 16 14 239 276 276 241 362 100 200 300 400 30 60 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 bcm US$/mcm 131 126 257 299 142 50 100 150 200 250 300 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014
Volumes and prices(3,5)
- 6%
- 2%
+ 57% + 8% + 1% + 136%
Volumes and prices
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36% 58% 6% Crude oil and gas condensate; refined products Gas business and other revenues Electric and heat energy
Oil and Energy Businesses
368.0 418.1 404.4 430.0 468.4 100 200 300 400 500 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014
Crude Oil and Gas Condensate; Refined Products Electric and Heat Energy
72.7 71.4 124.6 134.6 84.1 30 60 90 120 150 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 RR bn RR bn + 27% + 16%
2Q2014 IFRS Consolidated Financial Results
Calculations may diverge due to rounding. 1. Net of value added tax (VAT)
33% 60% 7%
Net Sales(1)
2Q2013 2Q2014
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+ 43 (+13%) + 31 (34%) + 79 (+210%) + 28 (+81%) + 17 (+31%) + 128 (+758%) + 15 (+13%) + 20 (+11%) +28 (+18%) 50 100 150 The rest of OpEx Changes in inventories of finished goods, work in progress and other effects Exchange rate differences Cost of goods for resale, inc. refined products Materials Charge for impairment provisions Staff costs Purchased gas and oil Taxes other than on income
2Q2014 vs. 2Q2013 Changes of Operating Expenses Items
+/- RR bn (+/- %)
Total OpEx: + RR 390 bn (+51%)
Main drivers of change
The rest of OpEx include: Depreciation; Transit of gas, oil and refined products; Repairs and maintenance; Electricity and heating expenses; Social expenses; Transportation services; Rental expenses; Insurance expenses; Processing services; Research and development expenses; Heat transmission; Derivatives gains (losses); Other OpEx.
2Q2014 IFRS Consolidated Financial Results
Due to an increase in the tax rate for gas from RR 582 to RR 700 per mcm since
- Jan. 1, 2014, and an increase in the tax rate on oil extraction from RR 470 to
RR 493 per ton Cost of purchased gas increased by RR 9 bn or 7%; and cost of purchased oil increased by RR 11 bn or 22% relating to activity of Gazprom Neft Group Mainly driven by accrual of provision for doubtful trade accounts receivable of NAK Naftogaz Ukraine Relates to average salary indexation and increase in average number of personnel Mainly relates to consolidation of OAO MIPC from Sept. 2013, increase of purchases of materials from third parties and increase in prices Mainly due to increase in volumes of refined products purchased from third parties Driven from depreciation of Euro and U.S. dollar against Rouble in 2Q2014 and appreciation of Euro and U.S. dollar against Rouble in 2Q2013 Due to an increase in the balances of inventories and finished goods
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Negative Effect of Changes in Working Capital in 2Q2014
2Q2014
Total Changes in Working Capital RR (4) bn
Decrease in accounts receivable Increase in cash in deposits Increase in gas inventories
RR 26 bn RR (21) bn RR (58) bn
RR (117) bn
Negative impact
- n the
company’s
- perating cash
flow during the period
Other effects
RR (51) bn
Decrease in accounts payable
2Q2014 IFRS Consolidated Financial Results
Changes in taxes payable
RR (9) bn
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- 10
10 30 50 70 90 110 130 150 170 500 1000 1500 2000 2500 3000 2011 2012 2013 2Q2013 2Q2014 Transport Production of natural gas Production of crude oil and gas condensate Refining Electric and heat energy Distribution Gas storage Other Self funding (OpCF/Cash CapEx) 1,628.1 1,545.2 1,475.2 148% 134% 265.0 347.3
Capital Expenditures
Gazprom Group’s CapEx(1) & self funding(2) position
RR bn
2Q2014 IFRS Consolidated Financial Results
- 1. CapEx breakdown as provided in Management Discussion and Analysis of Financial Consolidation and Results of Operations
- 2. Self funding = Net cash provided by operating activities / CapEx as provided in IFRS Consolidated Financial Statements
% 105% 109% 125%
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Impeccable Free Cash Flow Generation
Free Cash Flow
2Q2014 IFRS Consolidated Financial Results
- 1. Free Cash Flow = Net Cash from operating activities – Capital expenditures
81,9 114,4 141,9 20,6 73,7 289,9 75,6 50 100 150 200 250 300 350 4Q2012 1Q2013 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 RR bn
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Calculations may diverge due to rounding
- 1. Total debt: short-term borrowings and current portion of long-term borrowings, short-term promissory notes payable, long-term borrowings, long-term promissory notes payable and restructured tax liabilities
- 2. Excluding promissory notes
1,028 1,071 1,113 895 509 429 689 944 2011 2012 2013 1H2014 Net Debt Cash&Cash equivalents and certain restricted cash
1,537
24% 22% 18% 16% 17% 19% 13% 14% 38% 33% 36% 39% 21% 26% 33% 30% 2011 2012 2013 1H2014 Less than 1 year 1-2 years 2-5 years More than 5 years
0,8 0,9 0,9 1,0 0,5 0,7 0,6 0,5
2011 2012 2013 1H2014 Total Debt / Adj. EBITDA Net Debt / Adj. EBITDA
Debt Overview
Total Debt(1), RR bn Credit metrics
Max 1.6x
Debt maturity profile(2) Cost of debt financing(2)
%
1,501
2Q2014 IFRS Consolidated Financial Results
1,838 1,802
6.2% 2.8% 5.5% 1 3 5 7 9 2005 2006 2007 2008 2009 2010 2011 2012 2013 1H2014 Weighted average fixed interest rate Weighted average floating interest rate Weighted average interest rate
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