TIDMLKOD
RNS Number : 3569I
PJSC LukOil
29 August 2016
PJSC LUKOIL
CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(prepared in accordance with IFRS)
As of and for the three and six-month periods ended 30 June
2016
(unaudited)
These condensed interim consolidated financial statements were
prepared by PJSC LUKOIL in accordance with IFRS and have not been
audited by our independent auditor. If these condensed interim
consolidated financial statements are audited in the future, the
audit could reveal differences in our consolidated financial
results and we can not assure that any such differences would not
be material.
Auditors' Report on Review of Condensed Interim Consolidated Financial Statements
To the Shareholders and Board of Directors
PJSC LUKOIL
Introduction
We have reviewed the accompanying consolidated statement of
financial position of PJSC LUKOIL (the "Company") and its
subsidiaries (the "Group") as at 30 June 2016, and the related
consolidated statements of profit or loss and other comprehensive
income for the three- and six-month periods ended 30 June 2016 and
the related consolidated statements of changes in equity and cash
flows for the six - month period ended 30 June 2016, and notes to
the condensed interim consolidated financial statements (the
"condensed interim consolidated financial statements"). Management
is responsible for the preparation and presentation of these
condensed interim consolidated financial statements in accordance
with International Financial Reporting Standard IAS 34 Interim
Financial Reporting. Our responsibility is to express a conclusion
on these condensed interim consolidated financial statements based
on our review.
Scope of review
We conducted our review in accordance with International
Standard on Review Engagements 2410 Review of Interim Financial
Information Performed by the Independent Auditor of the Entity. A
review of condensed interim consolidated financial statements
consists of making inquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other
review procedures. A review is substantially less in scope than an
audit conducted in accordance with International Standards on
Auditing and consequently does not enable us to obtain assurance
that we would become aware of all significant matters that might be
identified in an audit. Accordingly, we do not express an audit
opinion.
Conclusion
Based on our review, nothing has come to our attention that
causes us to believe that the condensed interim consolidated
financial statements as at 30 June 2016, and for the three -and
six-month periods ended 30 June 2016 are not prepared, in all
material respects, in accordance with International Financial
Reporting Standard IAS 34 Interim Financial Reporting.
Oussov A.I.
Director, power of attorney dated 16
March 2015 No. 18/15
JSC "KPMG"
29 August 2016
Moscow, Russian Federation
PJSC LUKOIL
Consolidated Statement of Financial Position
(Millions of Russian rubles)
31 December
------------
30 June
2016
Note (unaudited) 2015
-------------------------------- ---- ------------ -------------
Assets
Current assets
Cash and cash equivalents 6 346,703 257,263
Accounts receivable, net 7 388,706 440,489
Other current financial
assets 16,970 23,768
Inventories 8 388,783 340,196
Income tax prepaid 15,668 7,413
Other taxes receivable 9 67,009 81,692
Other current assets 10 61,063 62,826
Total current assets 1,284,902 1,213,647
Property, plant and equipment 12 3,380,811 3,411,153
Investments in associates
and joint ventures 11 169,047 181,744
Other non-current financial
assets 13 106,424 102,067
Deferred income tax assets 27,018 28,735
Goodwill and other intangible
assets 47,416 51,749
Other non-current assets 30,853 31,512
-------------------------------- ---- ------------ -------------
Total non-current assets 3,761,569 3,806,960
-------------------------------- ---- ------------ -------------
Total assets 5,046,471 5,020,607
-------------------------------- ---- ------------ -------------
Liabilities and equity
Current liabilities
Accounts payable 14 424,715 394,339
Short-term borrowings and
current portion of long-term
debt 15 132,097 60,506
Income tax payable 6,990 11,640
Other taxes payable 17 93,545 73,277
Provisions 19 27,168 25,553
Other current liabilities 18 114,141 129,853
Total current liabilities 798,656 695,168
Long-term debt 16 732,582 799,207
Deferred income tax liabilities 234,943 234,107
Provisions 19 55,019 51,115
Other non-current liabilities 8,027 9,636
Total non-current liabilities 1,030,571 1,094,065
-------------------------------- ---- ------------ -------------
Total liabilities 1,829,227 1,789,233
-------------------------------- ---- ------------ -------------
Equity 20
Share capital 1,151 1,151
Treasury shares (241,615) (241,615)
Additional paid-in capital 129,508 129,403
Other reserves 66,791 104,150
Retained earnings 3,254,923 3,229,379
-------------------------------- ---- ------------ -------------
Total equity attributable
to PJSC LUKOIL shareholders 3,210,758 3,222,468
-------------------------------- ---- ------------ -------------
Non-controlling interests 6,486 8,906
-------------------------------- ---- ------------ -------------
Total equity 3,217,244 3,231,374
-------------------------------- ---- ------------ -------------
Total liabilities and equity 5,046,471 5,020,607
-------------------------------- ---- ------------ -------------
Acting Vice-president
Vice-president of - Chief accountant of
PJSC LUKOIL PJSC LUKOIL
Fedotov G.S. Kozyrev I.A.
The accompanying notes are an integral part of these condensed
interim consolidated financial statements.
PJSC LUKOIL
Consolidated Statement of Profit or Loss and Other Comprehensive
Income
(Millions of Russian rubles, unless otherwise noted)
For the For the For the
three three six months For the
months months ended six months
ended ended 30 June ended
30 June 30 June 2016 30 June
2016 2015 (unaudited) 2015
Note (unaudited) (unaudited) (unaudited)
--------------------------------- ---- ------------ ------------ ------------ ------------
Revenues
Sales (including
excise and export
tariffs) 28 1,338,959 1,476,966 2,516,633 2,917,271
Costs and other deductions
Operating expenses (113,709) (105,828) (226,953) (211,509)
Cost of purchased
crude oil, gas and
products (677,297) (777,640) (1,215,030) (1,477,705)
Transportation expenses (77,665) (68,377) (164,364) (147,162)
Selling, general
and administrative
expenses (45,302) (40,028) (93,125) (81,213)
Depreciation, depletion
and amortization (71,608) (87,058) (155,956) (165,521)
Taxes other than
income taxes (118,724) (141,219) (202,277) (271,054)
Excise and export
tariffs (113,820) (123,609) (228,769) (296,458)
Exploration expenses (2,871) (13,586) (4,552) (14,783)
--------------------------------- ---- ------------ ------------ ------------ ------------
Profit from operating
activities 117,963 119,621 225,607 251,866
Finance income 22 3,511 4,036 7,342 8,567
Finance costs 22 (11,098) (11,026) (21,469) (22,486)
Equity share in income
of affiliates 3,425 2,382 5,778 6,475
Foreign exchange
loss (28,945) (29,154) (74,323) (23,479)
Other expenses 23 (4,205) (2,784) (7,548) (8,556)
Profit before income
taxes 80,651 83,075 135,387 212,387
Current income taxes (17,183) (19,394) (27,659) (42,334)
Deferred income taxes (774) 575 (2,064) (1,358)
--------------------------------- ---- ------------ ------------ ------------ ------------
Total income tax
expense (17,957) (18,819) (29,723) (43,692)
--------------------------------- ---- ------------ ------------ ------------ ------------
Profit for the period 62,694 64,256 105,664 168,695
Profit for the period
attributable to non-controlling
interests (127) (508) (272) (916)
--------------------------------- ---- ------------ ------------ ------------ ------------
Profit for the period
attributable to
PJSC LUKOIL shareholders 62,567 63,748 105,392 167,779
--------------------------------- ---- ------------ ------------ ------------ ------------
Other comprehensive
income (loss), net
of income taxes
Items that may be
reclassified to profit
or loss:
Foreign currency
translation differences
for foreign operations (21,923) (8,045) (37,314) (35,641)
Items that will never
be reclassified to
profit or loss:
Remeasurements of
defined benefit liability
/ asset of pension
plan 13 336 33 652
--------------------------------- ---- ------------ ------------ ------------ ------------
Other comprehensive
loss (21,910) (7,709) (37,281) (34,989)
--------------------------------- ---- ------------ ------------ ------------ ------------
Total comprehensive
income for the period 40,784 56,547 68,383 133,706
Total comprehensive
income for the period
attributable to non-controlling
interests (119) (511) (298) (967)
--------------------------------- ---- ------------ ------------ ------------ ------------
Total comprehensive
income for the period
attributable to PJSC
LUKOIL shareholders 40,665 56,036 68,085 132,739
--------------------------------- ---- ------------ ------------ ------------ ------------
Earnings per share
of common stock attributable
to PJSC LUKOIL shareholders
(in Russian rubles):
Basic 20 87.76 89.42 147.83 235.34
Diluted 20 87.76 88.13 147.83 231.28
The accompanying notes are an integral part of these condensed
interim consolidated financial statements.
PJSC LUKOIL
Consolidated Statement of Changes in Equity (unaudited)
(Millions of Russian rubles)
Total
equity
attributable
Additional to PJSC
Share Treasury Equity-linked paid-in Other Retained LUKOIL Non-controlling Total
capital shares notes capital reserves earnings shareholders interests equity
---------------- ------- --------- ------------- ---------- -------- --------- ------------ --------------- ---------
31 December
2015 1,151 (241,615) - 129,403 104,150 3,229,379 3,222,468 8,906 3,231,374
Profit
for the
period - - - - - 105,392 105,392 272 105,664
Other
comprehensive
income:
Foreign
currency
translation
differences - - - (37,340) - (37,340) 26 (37,314)
Remeasurements
of defined
benefit
liability
/ asset
of pension
plan - - - - 33 - 33 - 33
-------- --------- ------------ --------------- ---------
Total
comprehensive
income
(loss) (37,307) 105,392 68,085 298 68,383
Dividends
on common
stock - - - - - (79,848) (79,848) - (79,848)
Changes
in
non-controlling
interests - - - 105 (52) - 53 (2,718) (2,665)
---------------- ------- --------- ------------- ---------- -------- --------- ------------ --------------- ---------
30 June
2016 1,151 (241,615) - 129,508 66,791 3,254,923 3,210,758 6,486 3,217,244
---------------- ------- --------- ------------- ---------- -------- --------- ------------ --------------- ---------
31 December
2014 1,151 (158,615) (83,000) 128,846 93,454 3,055,542 3,037,378 12,164 3,049,542
Profit
for the
period - - - - - 167,779 167,779 916 168,695
Other comprehensive
income:
Foreign
currency
translation
differences - - - - (35,692) - (35,692) 51 (35,641)
Remeasurements
of defined
benefit
liability
/ asset
of pension
plan - - - - 652 - 652 - 652
-------- --------- --------- ------- ---------
Total comprehensive
income
(loss) (35,040) 167,779 132,739 967 133,706
Dividends
on common
stock - - - - - (70,957) (70,957) - (70,957)
Changes
in non-controlling
interests - - - 2,339 - - 2,339 (3,717) (1,378)
-------------------- ----- --------- -------- ------- -------- --------- --------- ------- ---------
30 June
2015 1,151 (158,615) (83,000) 131,185 58,414 3,152,364 3,101,499 9,414 3,110,913
-------------------- ----- --------- -------- ------- -------- --------- --------- ------- ---------
The accompanying notes are an integral part of these condensed
interim consolidated financial statements.
PJSC LUKOIL
Consolidated Statement of Cash Flows
(Millions of Russian rubles)
For the For the
six six
months months
ended ended
30 June 30 June
2016 2015
Note (unaudited) (unaudited)
----------------------------------- ---- ------------ ------------
Cash flows from operating
activities
Profit for the period attributable
to PJSC LUKOIL shareholders 105,392 167,779
Adjustments for non-cash
items:
Depreciation, depletion
and amortization 155,956 165,521
Equity share in income
of affiliates, net of dividends
received (3,839) 65
Dry hole write-offs 522 13,668
Loss on disposals and impairments
of assets 4,718 8,251
Income tax expense 29,723 43,692
Non-cash foreign exchange
loss 70,506 21,211
Non-cash investing activities (69) (161)
Finance income (7,342) (8,567)
Finance costs 21,469 22,486
Bad debt provision 2,913 821
All other items - net 6,374 8,510
Changes in operating assets
and liabilities:
Trade accounts receivable 2,458 69,459
Inventories (87,849) (54,162)
Accounts payable 85,588 (24,766)
Other taxes 37,183 57,356
Other current assets and
liabilities (49,754) (75,076)
Income tax paid (35,788) (38,373)
Dividends received 2,102 -
Interests received 4,215 5,389
--------------------------------------- ---- ------------ ------------
Net cash provided by operating
activities 344,478 383,103
--------------------------------------- ---- ------------ ------------
Cash flows from investing
activities
Acquisition of licenses (2,408) (371)
Capital expenditures (248,664) (302,853)
Proceeds from sale of property,
plant and equipment 624 1,219
Purchases of financial
assets (13,299) (2,924)
Proceeds from sale of financial
assets 5,651 5,504
Sale of subsidiaries, net
of cash disposed 1,414 2,718
Sale of equity method affiliates - 9,410
Acquisitions of subsidiaries,
net of cash acquired - (272)
Acquisitions of equity
method affiliates (1,833) (3,299)
Net cash used in investing
activities (258,515) (290,868)
--------------------------------------- ---- ------------ ------------
Cash flows from financing
activities
Proceeds from issuance
of short-term borrowings 46,941 71,559
Principal repayments of
short-term borrowings (12,178) (26,447)
Proceeds from issuance
of long-term debt 89,276 19,402
Principal repayments of
long-term debt (14,050) (94,255)
Interest paid (23,574) (18,190)
Dividends paid on Company
common shares (46,324) (40,934)
Dividends paid to non-controlling
interest shareholders (1,587) (767)
Financing received from
non-controlling interest
shareholders 48 61
Sale of non-controlling
interests - 9
Purchases of non-controlling
interests (1,285) -
Net cash provided by (used
in) financing activities 37,267 (89,562)
--------------------------------------- ---- ------------ ------------
Effect of exchange rate
changes on cash and cash
equivalents (33,790) (19,429)
Net increase (decrease)
in cash and cash equivalents 89,440 (16,756)
Cash and cash equivalents
at beginning of period 257,263 169,023
--------------------------------------- ---- ------------ ------------
Cash and cash equivalents
at end of period 6 346,703 152,267
--------------------------------------- ---- ------------ ------------
The accompanying notes are an integral part of these condensed
interim consolidated financial statements.
PJSC LUKOIL
Notes to Condensed Interim Consolidated Financial Statements
(unaudited)
(Millions of Russian rubles, unless otherwise noted)
Note 1. Organization and environment
The primary activities of PJSC LUKOIL (the "Company") and its
subsidiaries (together, the "Group") are oil exploration,
production, refining, marketing and distribution. The Company is
the ultimate parent entity of this vertically integrated group of
companies.
The Group was established in accordance with Presidential Decree
No. 1403, issued on 17 November 1992. Under this decree, on 5 April
1993, the Government of the Russian Federation transferred to the
Company 51% of the voting shares of fifteen enterprises. Under
Government Resolution No. 861 issued on 1 September 1995, a further
nine enterprises were transferred to the Group during 1995. Since
1995, the Group has carried out a share exchange program to
increase its shareholding in each of the twenty-four founding
subsidiaries to 100%.
From formation, the Group has expanded substantially through
consolidation of its interests, acquisition of new companies and
establishment of new businesses.
In July 2015, the Company changed its legal form to Public Joint
Stock Company ("PJSC") following the requirements of the amended
Russian Civil Code.
Business and economic environment
The accompanying condensed interim consolidated financial
statements reflect management's assessment of the impact of the
business environment in the countries in which the Group operates
on the operations and the financial position of the Group. The
future business environments may differ from management's
assessment.
Note 2. Basis of preparation
Statement of compliance
The condensed interim consolidated financial statements have
been prepared in accordance with IAS 34 Interim Financial
Reporting. These condensed interim consolidated financial
statements should be read in conjunction with the Group's
consolidated financial statements for 2015 prepared in accordance
with International Financial Reporting Standards ("IFRS").
Selected explanatory notes are included to explain events and
transactions that are significant to an understanding of the
changes in financial position and performance of the Group since
the last consolidated financial statements for 2015.
The accompanying condensed interim consolidated financial
statements and notes thereto have not been audited by independent
auditors, except for the consolidated statement of financial
position at 31 December 2015.
The condensed interim consolidated financial statements were
authorised by the Vice-president of the Company on 29 August
2016.
Functional and presentation currency
The functional currency of each of the Group's consolidated
companies is the currency of the primary economic environment in
which the company operates. Management has analysed factors that
influence the choice of functional currency and has determined the
functional currency for each Group company. For the majority of
them the functional currency is the local currency. The functional
currency of the Company is the Russian ruble ("RUB").
The presentation currency of the consolidated financial
statements of the Group is the RUB. All financial information
presented in the RUB has been rounded to the nearest million,
except when otherwise indicated.
The results and financial position of Group companies whose
functional currency is different from the presentation currency of
the Group are translated into presentation currency using the
following procedures. Assets and liabilities are translated at
period-end exchange rates, income and expenses are translated at
rates which approximate actual rates at the date of the
transaction. Resulting exchange differences are recognised in other
comprehensive income.
Note 3. Summary of significant accounting policies
The accounting policies adopted in the preparation of these
condensed interim consolidated financial statements are consistent
with those applied and disclosed in the consolidated financial
statements for 2015.
Note 4. Use of estimates and judgments
Preparation of the consolidated financial statements in
accordance with IFRS requires management to make judgments,
estimates and assumptions that affect the application of accounting
policies and the reported amounts of assets, liabilities, income
and expenses. Actual results may differ from those estimates.
Estimates and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates are recognised in the
period in which the estimates are revised and in any future periods
affected.
Critical judgments in applying accounting policies that have the
most significant effect on the amounts recognised in the
consolidated financial statements are the following:
-- Estimation of oil and gas reserves;
-- Estimation of useful lives of property, plant and equipment;
-- Impairment of non-current assets;
-- Assessment of asset retirement obligations;
-- Assessment and recognition of provisions and contingent liabilities;
-- Assessment of deferred income tax assets and liabilities;
-- Determination of whether a joint arrangement is a joint venture or a joint operation.
Note 5. Income taxes
Operations in the Russian Federation are subject to a Federal
income tax rate of 2.0% and a regional income tax rate that varies
from 13.5% to 18.0% at the discretion of the individual regional
administration. The Group's foreign operations are subject to taxes
at the tax rates applicable to the jurisdictions in which they
operate.
The Group's effective income tax rate for the periods presented
differs from the statutory income tax rate primarily due to
domestic and foreign tax rate differences and the incurrence of
costs that are either not tax deductible or only deductible to a
certain limit. Tax expense is recognised based on the management's
best estimate of the weighted-average annual income tax rate
expected for the full financial year multiplied by the pre-tax
income of the interim reporting period.
The Company and its Russian subsidiaries file income tax returns
in Russia. A number of Group companies in Russia are paying income
tax as a consolidated taxpayers' group ("CTG"). This allows
taxpayers to offset taxable losses generated by certain
participants of a CTG against taxable profits of other participants
of the CTG.
Note 6. Cash and cash equivalents
30 June 31 December
2016 2015
-------------------------------- ------- -----------
Cash held in RUB 34,135 98,253
Cash held in US dollars 283,745 141,863
Cash held in other currencies 28,823 17,147
Total cash and cash equivalents 346,703 257,263
--------------------------------- ------- -----------
Note 7. Accounts receivable, net
30 June 31 December
2016 2015
---------------------------------- ------- -----------
Trade accounts receivable
(net of allowances of 17,967
million RUB and
17,322 million RUB at 30
June 2016 and 31 December
2015, respectively) 356,223 375,531
Other current accounts receivable
(net of allowances of 1,929
million RUB and 1,599 million
RUB at 30 June 2016 and 31
December 2015, respectively) 32,483 64,958
Total accounts receivable,
net 388,706 440,489
----------------------------------- ------- -----------
Note 8. Inventories
30 June 31 December
2016 2015
--------------------------------- ------- -----------
Crude oil and petroleum products 323,763 275,941
Materials for extraction and
drilling 21,327 21,345
Materials and supplies for
refining 3,237 3,732
Other goods, materials and
supplies 40,456 39,178
Total inventories 388,783 340,196
---------------------------------- ------- -----------
Note 9. Other taxes receivable
30 June 31 December
2016 2015
------------------------------- ------- -----------
VAT and excise tax recoverable 36,936 39,171
Export duties prepaid 10,108 21,824
Other taxes prepaid 19,965 20,697
Total other taxes receivable 67,009 81,692
-------------------------------- ------- -----------
Note 10. Other current assets
30 June 31 December
2016 2015
--------------------------- ------- -----------
Advance payments 25,681 16,341
Prepaid expenses 25,910 31,960
Other assets 9,472 14,525
Total other current assets 61,063 62,826
---------------------------- ------- -----------
Note 11. Investments in associates and joint ventures
Carrying value of investments in associates and joint
ventures:
Ownership, %
--------------------
30 June 31 December 30 June 31 December
Name of the company Country 2016 2015 2016 2015
---------------------- ----------- ------- ----------- ------- -----------
Joint Ventures:
Tengizchevroil Kazakhstan 5% 5% 90,752 99,843
Caspian Pipeline
Consortium Kazakhstan 12.5% 12.5% 25,590 27,574
Turgai Petroleum Kazakhstan 50% 50% 1,763 1,675
Shakh-Deniz Midstream Azerbaijan 10% 10% 22,246 22,284
Associates:
Other associates 28,696 30,368
Total 169,047 181,744
----------------------------------- ------- ----------- ------- -----------
Note 12. Property, plant and equipment
Refining,
Exploration marketing
and production and distribution Other Total
-------------------------- ---------------- ------------------ --------- ------------
Cost
1 January 2016 3,232,673 1,206,252 103,587 4,542,512
Additions 203,974 28,882 1,041 233,897
Capitalised borrowing
costs 4,694 211 - 4,905
Disposals (5,845) (17,437) (516) (23,798)
Foreign currency
translation differences (138,021) (48,226) (1,825) (188,072)
Other (4,215) 6,171 338 2,294
-------------------------- ---------------- ------------------ --------- ------------
30 June 2016 3,293,260 1,175,853 102,625 4,571,738
-------------------------- ---------------- ------------------ --------- ------------
Depreciation and
impairment
1 January 2016 (953,254) (259,515) (14,627) (1,227,396)
Depreciation for
the period (106,474) (43,491) (3,058) (153,023)
Impairment loss - (78) - (78)
Disposals 1,209 9,486 268 10,963
Foreign currency
translation differences 77,554 16,444 404 94,402
Other (83) (1,893) (11) (1,987)
-------------------------- ---------------- ------------------ --------- ------------
30 June 2016 (981,048) (279,047) (17,024) (1,277,119)
-------------------------- ---------------- ------------------ --------- ------------
Advance payments
for property,
plant and equipment
1 January 2016 94,619 1,280 138 96,037
-------------------------- ---------------- ------------------ --------- ------------
30 June 2016 85,300 776 116 86,192
-------------------------- ---------------- ------------------ --------- ------------
Carrying amounts
1 January 2016 2,374,038 948,017 89,098 3,411,153
-------------------------- ---------------- ------------------ --------- ------------
30 June 2016 2,397,512 897,582 85,717 3,380,811
-------------------------- ---------------- ------------------ --------- ------------
Refining,
Exploration marketing
and production and distribution Other Total
-------------------------- ---------------- ------------------ --------- ----------
Cost
1 January 2015 2,556,173 1,030,097 95,392 3,681,662
Additions 225,859 63,104 1,646 290,609
Acquisitions through
business combinations 305 149 - 454
Capitalised borrowing
costs 171 503 - 674
Disposals (18,740) (1,459) (535) (20,734)
Foreign currency
translation differences (12,907) (39,808) (228) (52,943)
Other 3,465 (3,765) (63) (363)
-------------------------- ---------------- ------------------ --------- ----------
30 June 2015 2,754,326 1,048,821 96,212 3,899,359
-------------------------- ---------------- ------------------ --------- ----------
Depreciation and
impairment
1 January 2015 (444,128) (142,713) (8,525) (595,366)
Depreciation for
the period (131,721) (30,136) (2,960) (164,817)
Disposals 707 3,473 116 4,296
Foreign currency
translation differences 4,465 8,951 196 13,612
Other (1,597) (489) (42) (2,128)
-------------------------- ---------------- ------------------ --------- ----------
30 June 2015 (572,274) (160,914) (11,215) (744,403)
-------------------------- ---------------- ------------------ --------- ----------
Advance payments
for property,
plant and equipment
1 January 2015 58,558 8,258 467 67,283
-------------------------- ---------------- ------------------ --------- ----------
30 June 2015 74,812 2,397 510 77,719
-------------------------- ---------------- ------------------ --------- ----------
Carrying amounts
1 January 2015 2,170,603 895,642 87,334 3,153,579
-------------------------- ---------------- ------------------ --------- ----------
30 June 2015 2,256,864 890,304 85,507 3,232,675
-------------------------- ---------------- ------------------ --------- ----------
The cost of assets under construction included in Property,
plant and equipment was 615,890 million RUB and 676,908 million RUB
at 30 June 2016 and 31 December 2015, respectively.
Exploration and evaluation assets:
For the For the
six months six months
ended ended
30 June 30 June
2016 2015
------------------------------------------ ------------ ------------
1 January 52,302 46,906
Capitalized expenditures 15,317 11,567
Reclassified to development assets (3,633) (8,036)
Charged to expenses (483) (69)
Foreign currency translation differences (1,160) -
Other movements (127) 18
------------------------------------------ ------------ ------------
30 June 62,216 50,386
------------------------------------------ ------------ ------------
Note 13. Other non-current financial assets
30 June 31 December
2016 2015
---------------------------------- ------- -----------
Long-term loans 94,188 89,770
Non-current accounts and notes
receivable 8,326 8,148
Other non-current financial
assets 3,910 4,149
Total other non-current financial
assets 106,424 102,067
----------------------------------- ------- -----------
Note 14. Accounts payable
30 June 31 December
2016 2015
----------------------- ------- -----------
Trade accounts payable 374,177 339,091
Other accounts payable 50,538 55,248
Total accounts payable 424,715 394,339
------------------------ ------- -----------
Note 15. Short-term borrowings and current portion of long-term
debt
30 June 31 December
2016 2015
---------------------------------- ------- -----------
Short-term borrowings from
third parties 60,096 33,611
Short-term borrowings from
related parties 5,063 5,609
Current portion of long-term
debt 66,938 21,286
Total short-term borrowings
and current portion of long-term
debt 132,097 60,506
----------------------------------- ------- -----------
Short-term borrowings from third parties include amounts
repayable in US dollars of 46,960 million RUB and 22,951 million
RUB and amounts repayable in other currencies of 13,136 million RUB
and 10,660 million RUB at 30 June 2016 and 31 December 2015,
respectively. The weighted-average interest rate on short-term
borrowings from third parties was 4.36% and 5.43% per annum at 30
June 2016 and 31 December 2015, respectively. Approximately 78% of
total short-term borrowings from third parties at 30 June 2016 are
secured by inventories.
Note 16. Long-term debt
30 June 31 December
2016 2015
------------------------------- -------- -----------
Long-term loans and borrowings
from third parties 436,448 408,781
Long-term borrowings from
related parties - 138
6.356% non-convertible US
dollar bonds, maturing 2017 32,129 36,441
3.416% non-convertible US
dollar bonds, maturing 2018 96,124 108,983
7.250% non-convertible US
dollar bonds, maturing 2019 38,442 43,583
6.125% non-convertible US
dollar bonds, maturing 2020 64,173 72,778
6.656% non-convertible US
dollar bonds, maturing 2022 32,129 36,441
4.563% non-convertible US
dollar bonds, maturing 2023 96,124 108,983
Capital lease obligations 3,951 4,365
-------------------------------- -------- -----------
Total long-term debt 799,520 820,493
Current portion of long-term
debt (66,938) (21,286)
Total non-current portion
of long-term debt 732,582 799,207
-------------------------------- -------- -----------
Long-term loans and borrowings
Long-term loans and borrowings from third parties include
amounts repayable in US dollars of 303,751 million RUB and 336,842
million RUB, amounts repayable in euros of 61,379 million RUB and
70,447 million RUB, amounts repayable in other currencies of 1,318
million RUB and 1,492 million RUB at 30 June 2016 and 31 December
2015, respectively, and amounts repayable in RUB of 70,000 million
RUB at 30 June 2016. This debt has maturity dates from 2016 through
2028. The weighted-average interest rate on long-term loans and
borrowings from third parties was 5.32% and 3.77% per annum at 30
June 2016 and 31 December 2015, respectively. A number of long-term
loan agreements contain certain financial covenants which are being
met by the Group. Approximately 15% of total long-term loans and
borrowings from third parties at 30 June 2016 are secured by shares
of an associated company, export sales and property, plant and
equipment.
Note 17. Other taxes payable
30 June 31 December
2016 2015
-------------------------- ------- -----------
Mineral extraction tax 37,069 24,566
VAT 26,173 21,532
Excise tax 18,996 15,553
Property tax 4,400 4,583
Other taxes 6,907 7,043
Total other taxes payable 93,545 73,277
--------------------------- ------- -----------
Note 18. Other current liabilities
30 June 31 December
2016 2015
-------------------------------- ------- -----------
Advances received 28,906 79,424
Dividends payable 81,907 47,615
Other 3,328 2,814
Total other current liabilities 114,141 129,853
--------------------------------- ------- -----------
Note 19. Provisions
Asset Provision Provision
retirement Provision for for
obligation for employee environmental Pension compensated Other
compensations liabilities provisions absences provisions Total
------------------- ------------ -------------- -------------- ------------ -------------- ------------ -------
30 June
2016 33,466 24,279 5,244 7,630 4,944 6,624 82,187
Incl.:
Non-current 31,707 12,679 3,057 6,132 66 1,378 55,019
Current 1,759 11,600 2,187 1,498 4,878 5,246 27,168
31 December
2015 32,919 19,837 5,455 7,913 3,591 6,953 76,668
------------------- ------------ -------------- -------------- ------------ -------------- ------------ -------
Incl.:
Non-current 32,632 6,733 3,575 6,392 134 1,649 51,115
Current 287 13,104 1,880 1,521 3,457 5,304 25,553
Assets retirement obligation:
For the For the
six months six months
ended ended
30 June 30 June
2016 2015
------------------------------------------ ------------ ------------
1 January 32,919 19,604
Provisions made during the period 1,816 255
Reversal of provisions (38) (172)
Provisions used during the period (44) (47)
Accretion expense 1,117 430
Changes in estimates 40 (370)
Foreign currency translation differences (2,157) (266)
Other (187) 78
------------------------------------------ ------------ ------------
30 June 33,466 19,512
------------------------------------------ ------------ ------------
Note 20. Equity
Common shares
30 June 31 December
2016 2015
(thousands (thousands
of shares) of shares)
Authorized common shares,
par value of 0.025 RUB each 850,563 850,563
Issued common shares, par
value of 0.025 RUB each 850,563 850,563
Treasury shares (137,630) (137,630)
Outstanding common shares 712,933 712,933
------------------------------ ----------- -----------
Dividends
At the annual shareholders' meeting on 23 June 2016, dividends
for 2015 were approved in the amount of 112.00 RUB per common
share. At the extraordinary shareholders' meeting on 16 December
2015, interim dividends for 2015 were approved in the amount of
65.00 RUB per common share. Total dividends for 2015 were approved
in the amount of 177.00 RUB per common share. At the annual
shareholders' meeting on 25 June 2015, dividends for 2014 were
approved in the amount of 94.00 RUB per common share. At the
extraordinary shareholders' meeting on 12 December 2014, interim
dividends for 2014 were approved in the amount of 60.00 RUB per
common share. Total dividends for 2014 were approved in the amount
of 154.00 RUB per common share.
Dividends on the Company's shares payable of 80,114 million RUB
and 46,609 million RUB are included in "Other current liabilities"
in the consolidated statement of financial position at 30 June 2016
and 31 December 2015, respectively.
Earnings per share
The calculation of basic and diluted earnings per share was as
follows.
For the For the
three three For the For the
months months six months six months
ended ended ended ended
30 June 30 June 30 June 30 June
2016 2015 2016 2015
--------------------------------- -------- -------- ----------- -----------
Profit for the period
attributable to PJSC
LUKOIL shareholders 62,567 63,748 105,392 167,779
--------------------------------- -------- -------- ----------- -----------
Add back interest and
accretion on 2.625% convertible
US dollar bonds, maturing
2015 (net of tax at effective
rate) - 697 - 1,718
--------------------------------- -------- -------- ----------- -----------
Total diluted profit
for the period attributable
to
PJSC LUKOIL shareholders 62,567 64,445 105,392 169,497
--------------------------------- -------- -------- ----------- -----------
Weighted average number
of outstanding common
shares (thousands of
shares) 712,933 754,866 712,933 754,866
Equity-linked notes - (41,933) - (41,933)
--------------------------------- -------- -------- ----------- -----------
Weighted average number
of common shares
(thousands of shares) 712,933 712,933 712,933 712,933
Add back treasury shares
held in respect of convertible
debt (thousands of shares) - 18,291 - 19,945
--------------------------------- -------- -------- ----------- -----------
Weighted average number
of common shares,
assuming dilution (thousands
of shares) 712,933 731,224 712,933 732,878
--------------------------------- -------- -------- ----------- -----------
Earnings per share of
common stock attributable
to
PJSC LUKOIL shareholders
(RUB):
Basic 87.76 89.42 147.83 235.34
Diluted 87.76 88.13 147.83 231.28
--------------------------------- -------- -------- ----------- -----------
Note 21. Personnel expenses
Personnel expenses were as follows.
For the three For the three For the six For the six
months ended months ended months ended months ended
30 June 2016 30 June 2015 30 June 2016 30 June 2015
-------------------------- -------------- -------------- -------------- --------------
Salary 35,137 31,718 69,852 60,582
Statutory insurance
contributions 7,394 6,825 14,994 13,644
Share-based payments 2,400 (557) 6,344 3,585
Total personnel expenses 44,931 37,986 91,190 77,811
-------------------------- -------------- -------------- -------------- --------------
Note 22. Finance income and costs
Finance income was as follows.
For the three For the three For the six For the six
months ended months ended months ended months ended
30 June 2016 30 June 2015 30 June 2016 30 June 2015
---------------------- -------------- -------------- -------------- --------------
Interest income from
deposits 1,354 2,494 2,849 4,914
Interest income from
loans 1,819 1,363 3,697 2,915
Other finance income 338 179 796 738
---------------------- -------------- -------------- -------------- --------------
Total finance income 3,511 4,036 7,342 8,567
---------------------- -------------- -------------- -------------- --------------
Finance costs were as follows.
For the three For the three For the six For the six
months ended months ended months ended months ended
30 June 2016 30 June 2015 30 June 2016 30 June 2015
------------------------ -------------- -------------- -------------- --------------
Interest expenses 10,259 9,576 20,184 20,567
Accretion expenses 751 123 1,124 442
Other finance expenses 88 1,327 161 1,477
------------------------ -------------- -------------- -------------- --------------
Total finance costs 11,098 11,026 21,469 22,486
------------------------ -------------- -------------- -------------- --------------
Note 23. Other income and expenses
Other income was as follows.
For the three For the three For the six For the six
months ended months ended months ended months ended
30 June 2016 30 June 2015 30 June 2016 30 June 2015
------------------------ -------------- -------------- -------------- --------------
Gain on disposal of
assets 176 1,761 916 2,750
Changes in estimates
of asset retirement
obligation 9 156 29 258
Reversal on impairment
of assets - 3 - 296
Other income 3,939 3,790 7,779 6,573
------------------------ -------------- -------------- -------------- --------------
Total other income 4,124 5,710 8,724 9,877
------------------------ -------------- -------------- -------------- --------------
Other expenses were as follows.
For the three For the three For the six For the six
months ended months ended months ended months ended
30 June 2016 30 June 2015 30 June 2016 30 June 2015
---------------------- -------------- -------------- -------------- --------------
Loss on disposal of
assets 2,825 4,688 5,170 6,127
Impairment loss 356 189 464 5,170
Charity expenses 3,926 2,299 6,343 3,705
Other expenses 1,222 1,318 4,295 3,431
---------------------- -------------- -------------- -------------- --------------
Total other expenses 8,329 8,494 16,272 18,433
---------------------- -------------- -------------- -------------- --------------
Note 24. Operating lease
At 30 June 2016 and 31 December 2015, Group companies had
commitments primarily related to the lease of vessels and petroleum
distribution outlets. Commitments for minimum rentals under these
leases are payable as follows.
30 June 31 December
2016 2015
------------------ ------- -----------
Less than a year 31,215 35,858
1-5 years 49,069 46,589
More than 5 years 87,845 80,924
Total 168,129 163,371
------------------- ------- -----------
Note 25. Commitments and contingencies
Capital commitments
At 30 June 2016, capital commitments of the Group relating to
construction and acquisition of property, plant and equipment are
evaluated as 471,866 million RUB.
Taxation environment
The taxation systems in the Russian Federation and other
emerging markets where Group companies operate are relatively new
and are characterised by numerous taxes and frequently changing
legislation, which is often unclear, contradictory, and subject to
interpretation. Often, differing interpretations exist among
different tax authorities within the same jurisdictions and among
taxing authorities in different jurisdictions. Taxes are subject to
review and investigation by a number of authorities, who are
enabled by law to impose severe fines, penalties and interest
charges. In the Russian Federation a tax year remains open for
review by the tax authorities during the three subsequent calendar
years. However, under certain circumstances a tax year may remain
open longer. Recent events within the Russian Federation suggest
that the tax authorities are taking a more assertive position in
their interpretation and enforcement of tax legislation. Such
factors may create substantially more significant taxation risks in
the Russian Federation and other emerging markets where Group
companies operate, than those in other countries where taxation
regimes have been subject to development and clarification over
long periods.
The tax authorities in each region may have a different
interpretation of similar taxation issues which may result in
taxation issues successfully defended by the Group in one region
being unsuccessful in another region. There is some direction
provided from the central authority based in Moscow on particular
taxation issues. The Group has implemented tax planning and
management strategies based on existing legislation at the time of
implementation. The Group is subject to tax authority audits on an
ongoing basis, as is normal in the Russian environment and other
republics of the former Soviet Union, and, at times, the
authorities have attempted to impose additional significant taxes
on the Group. Management believes that it has adequately met and
provided for tax liabilities based on its interpretation of
existing tax legislation. However, the relevant tax authorities may
have differing interpretations and the effects on the consolidated
financial statements, if the authorities were successful in
enforcing their interpretations, could be significant.
Litigation and claims
On 27 November 2001, Archangel Diamond Corporation ("ADC"), a
Canadian diamond development company, filed a lawsuit in the Denver
District Court, Colorado against AO Arkhangelskgeoldobycha ("AGD"),
a Group company, and the Company (together the "Defendants"). ADC
alleged that the Defendants interfered with the transfer of a
diamond exploration license to Almazny Bereg, a joint venture
between ADC and AGD. ADC claimed compensatory damages of $1.2
billion (77.1 billion RUB) and punitive damages of $3.6 billion
(231.3 billion RUB). On 15 October 2002, the District Court
dismissed the lawsuit for lack of personal jurisdiction. This
ruling was upheld by the Colorado Court of Appeals on 25 March
2004. However, on 21 November 2005, due to a procedural error, the
Colorado Supreme Court remanded the case to the Colorado Court of
Appeals and the Colorado Court of Appeals remanded the case to the
District Court. On 20 October 2011, the Denver District Court
dismissed all claims against the Company for lack of jurisdiction.
On 23 August 2012, the Colorado Court of Appeals affirmed this
decision. On 1 July 2013, the Colorado Supreme Court denied ADC's
Petition for Writ of Certiorari. The case in the state court is
therefore over.
On 6 January 2012, ADC filed a lawsuit in the US District Court
for the District of Colorado (federal court) reasserting almost
identical claims asserted in the aforementioned lawsuit and
dismissed by the Denver District Court (state court). In the
federal Court case, the Company has filed a Motion to Dismiss. On
18 December 2014, the federal court granted the motion based on
lack of personal jurisdiction over the Company and the doctrine of
"forum non conveniens". ADC filed a notice of appeal in the US
Court of Appeals for the Tenth Circuit. On 9 February 2016, the US
Court of Appeals for the Tenth Circuit affirmed the dismissal of
the case on "forum non conveniens" grounds. On 23 February 2016,
ADC filed a Petition for rehearing and for "rehearing en banc". On
1 April 2016, the US Court of Appeals for the Tenth Circuit denied
both ADC'c Petition for rehearing and for "rehearing en banc". On
28 July 2016, ADC filed a Petition for Writ of Certiorari. The
Company plans to seek dismissal of the case and vigorously defend
the matter. Management does not believe that the ultimate
resolution of this matter will have a material adverse effect on
the Group's financial position.
In June 2014, the prosecutors with the Ploesti Court of Appeals
(hereinafter the "Prosecutor's Office") issued an order on
initiation of criminal proceedings and brought charges against
PETROTEL-LUKOIL S.A. refinery, a Group company, and its general
director based on alleged tax evasion and money laundering. Later
the Prosecutor's Office added bad faith use of the company's credit
and money laundering charges for 2008-2010 against LUKOIL Europe
Holdings B.V., a Group company. The amount of the claim is not
finalised. LUKOIL LUBRICANTS EAST EUROPE S.R.L., LUKOIL ENERGY
& GAS ROMANIA S.R.L., Group companies, and a number of Romanian
legal entities not affiliated with the Group are also considered to
be suspects in this criminal case. At the moment a preliminary
investigation of the criminal case is being conducted. Tax audits
of PETROTEL-LUKOIL S.A. have not revealed any material violations
so far. In July 2015, a new charge in respect of bad faith use of
the company's credit and money laundering was brought against the
general director and several officers of PETROTEL-LUKOIL S.A. A
similar charge was brought against LUKOIL Europe Holdings B.V. and
PETROTEL-LUKOIL S.A. for 2011-2014. On 3 August 2015, the
Prosecutor's Office issued the final indictment on the new charges
and submitted the case to the Prahova Tribunal for further
consideration by the preliminary chamber judge. The allegations of
bad faith use of the company's credit in respect of PETROTEL-LUKOIL
S.A. were excluded from the final indictment. Following the
preliminary hearing the Prosecutor's Office revised the amount of
damage claimed from $2.2 billion (141.4 billion RUB) to $1.5
billion (96.4 billion RUB). This amount is not final. During the
entire trial it may be revised by the Tribunal on the basis of
evidence produced. On 15 December 2015, the Prahova Tribunal
ascertained that there are numerous irregularities in the
indictment act and returned the criminal file to the Prosecutor's
Office. The solution was confirmed by the Ploesti Court of Appeal
on 19 January 2016. However, the Prosecutor has prepared a new
indictment act based on the same accusations which were submitted
to the Prahova Tribunal on 22 January 2016. On 18 April 2016, the
preliminary hearing chamber of the Prahova Tribunal decided on the
hearing of the case on the merits. Moreover, on 10 May 2016, the
Prahova Tribunal lifted all preventive measures that were in effect
against the accused individuals. At the current stage of the
hearings the defendants are making oral statements. Next hearing on
the merits will take place on 22 September 2016. Management of
PETROTEL-LUKOIL S.A. and its tax and legal counsel are actively
defending the lawful rights and interests of the refinery, provide
all required opinions, clarifications and comments, and prepare an
exhaustive set of evidence to fully rebut the charges brought by
the Prosecutor's Office. Management does not believe that the
outcome of this matter will have a material adverse effect on the
Group's financial position.
LUKOIL Overseas Karachaganak B.V., a Group company, among other
contractors, is involved in the dispute related to cost recovery
and calculation of the "fairness index" in accordance with the
Final Production Sharing Agreement in respect of the Karachaganak
field in Kazakhstan. An estimated total of claims filed by the
Republic of Kazakhstan is about $1.8 billion (115.7 billion RUB), a
share of LUKOIL Overseas Karachaganak B.V. is about $243 million
(15.6 billion RUB). At the moment the parties are negotiating an
amicable settlement of this dispute. Management does not believe
that the ultimate resolution of this matter will have a material
adverse effect on the Group's financial position.
The Group is involved in various other claims and legal
proceedings arising in the normal course of business. While these
claims may seek substantial damages against the Group and are
subject to uncertainty inherent in any litigation, management does
not believe that the ultimate resolution of such matters will have
a material adverse impact on the Group's operating results or
financial condition.
Political situation
Political and economic situation in Ukraine remained unstable
during 2015-2016. Though the Group's assets and operations in
Ukraine are not material, the Group monitors the situation and
assesses the risks associated with its operations in Ukraine.
In July-September 2014, the United States ("US"), the European
Union ("EU") and other countries imposed a set of economic
sanctions on Russia, including certain sectoral sanctions which
affect Russian oil and gas companies. Such sectoral sanctions
prohibit US and the EU companies and individuals from providing,
exporting, or reexporting directly or indirectly, goods, services
(except for financial services), or technology in support of
exploration or production for deepwater, Arctic offshore or shale
projects on the territory of the Russian Federation. The Company
considers these sanctions in its activities, continuously monitors
them and analyses the effect of the sanctions on the Company's
financial position and results of operations.
The Group is exposed to political, economic and legal risks due
to its operations in Iraq. Management monitors the risks associated
with the projects in Iraq and believes that there is no adverse
effect on the Group's financial position that can be reasonably
estimated at present.
Note 26. Related party transactions
In the rapidly developing business environment in the Russian
Federation, companies and individuals have frequently used nominees
and other forms of intermediary companies in transactions. The
senior management of the Company believes that the Group has
appropriate procedures in place to identify and properly disclose
transactions with related parties in this environment and has
disclosed all of the relationships identified which it deemed to be
significant. Related party sales and purchases of oil and oil
products were primarily to and from associated companies.
Outstanding balances with related parties were as follows.
30 June 31 December
2016 2015
----------------------- ------- -----------
Accounts receivable 9,097 10,925
Other financial assets 100,069 98,538
------------------------ ------- -----------
Total assets 109,166 109,463
------------------------ ------- -----------
Accounts payable 8,538 8,458
Loans and borrowings 5,063 5,747
------------------------ ------- -----------
Total liabilities 13,601 14,205
------------------------ ------- -----------
Related party transactions were as follows.
For the three For the three For the six For the six
months ended months ended months ended months ended
30 June 2016 30 June 2015 30 June 2016 30 June 2015
---------------------- -------------- -------------- -------------- --------------
Sales of oil and oil
products 5,453 8,452 9,834 16,035
Other sales 452 382 846 741
Purchases of oil and
oil products 22,297 16,335 35,442 33,513
Other purchases 461 1,392 2,685 3,435
Loans given 4,105 1,350 12,529 1,869
Loans received 1,548 8,537 2,238 11,333
---------------------- -------------- -------------- -------------- --------------
Note 27. Compensation plan
In December 2012, the Company introduced a compensation plan
available to certain members of management for the period from 2013
to 2017, which is based on assigned shares and provides
compensation consisting of two parts. The first part represents
annual bonuses that are based on the number of assigned shares and
amount of dividend per share. The payment of these bonuses is
contingent on the Group meeting certain financial KPIs in each
financial year. The second part is based upon the Company's common
shares appreciation from 2013 to 2017, with rights vesting after
the date of the compensation plan's termination. The number of
assigned shares is approximately 19 million shares.
For the first part of the share plan the Group recognised a
liability based on expected dividends and number of assigned
shares. The second part of the share plan was also classified as
liability settled. The reporting date fair value of this part of
the plan was estimated at 15,711 million RUB, using the
Black-Scholes-Merton option-pricing model. The fair value was
estimated assuming a risk-free interest rate of 9.53% per annum, an
expected dividend yield of 7.08% per annum, an expected time to
maturity of two years and a volatility factor of 14.99%. The
expected volatility factor for the annual weighted average share
price was estimated based on the historical volatility of the
Company's shares for the previous ten years from 2006 till
2015.
Related to this share plan the Group recognised 2,400 million
RUB of compensation expenses during the three months ended 30 June
2016, 557 million RUB of income during the three months ended 30
June 2015, 6,344 million RUB and 3,585 million RUB of compensation
expenses during the six months ended 30 June 2016 and 2015,
respectively. At 30 June 2016 and 31 December 2015, amounts of
16,042 million RUB and 9,698 million RUB related to this plan are
included in "Provisions" of the consolidated statement of financial
position, respectively.
At 30 June 2016, there was 4,713 million RUB of total
unrecognized compensation cost related to unvested benefits. This
cost is expected to be recognized periodically by the Group up to
December 2017.
Note 28. Segment information
The Group has the following operating segments - exploration and
production; refining, marketing and distribution; corporate and
other business segments. These segments have been determined based
on the nature of their operations. Management on a regular basis
assesses the performance of these operating segments. The
exploration and production segment explores for, develops and
produces primarily crude oil. The refining, marketing and
distribution segment processes crude oil into refined products,
purchases, sells and transports crude oil and refined petroleum
products, refines and sells chemical products, produces steam and
electricity, distributes them and provides related services. The
corporate and other business operating segment includes activities
of the Company and businesses beyond the Group's traditional
operations.
Geographical segments are based on the area of operations and
include two segments: Russia and International.
EBITDA is a supplemental non-IFRS financial measure used by
management to evaluate segments performance. EBITDA is defined as
profit before interest, income taxes, depreciation and
amortisation.
Operating segments
For the three months ended 30 June 2016
Refining,
Exploration marketing Corporate
and production and distribution and other Elimination Consolidated
-------------------- --------------- ----------------- ---------- ----------- ------------
Sales and other
operating revenues
Third parties 42,485 1,288,758 7,716 - 1,338,959
Inter-segment 382,814 15,782 12,457 (411,053) -
-------------------- --------------- ----------------- ---------- ----------- ------------
Total revenues 425,299 1,304,540 20,173 (411,053) 1,338,959
-------------------- --------------- ----------------- ---------- ----------- ------------
Operating expenses 67,355 59,393 5,063 (18,102) 113,709
Selling, general
and administrative
expenses 9,957 30,866 12,858 (8,379) 45,302
Profit (loss)
for the period
attributable
to PJSC LUKOIL
shareholders 67,519 24,299 (28,071) (1,180) 62,567
EBITDA 134,701 50,192 (26,532) 1,358 159,719
Income tax
expense (17,957)
Finance income 3,511
Finance costs (11,098)
Depreciation,
depletion and
amortisation (71,608)
Profit for
the period
attributable
to PJSC LUKOIL
shareholders 62,567
-------------------- --------------- ----------------- ---------- ----------- ------------
For the three months ended 30 June 2015
Refining,
Exploration marketing Corporate
and production and distribution and other Elimination Consolidated
-------------------- --------------- ----------------- ---------- ----------- ------------
Sales and other
operating revenues
Third parties 64,659 1,405,223 7,084 - 1,476,966
Inter-segment 444,413 13,120 16,758 (474,291) -
-------------------- --------------- ----------------- ---------- ----------- ------------
Total revenues 509,072 1,418,343 23,842 (474,291) 1,476,966
-------------------- --------------- ----------------- ---------- ----------- ------------
Operating expenses 63,017 44,414 5,424 (7,027) 105,828
Selling, general
and administrative
expenses 9,841 30,251 9,034 (9,098) 40,028
Profit (loss)
for the period
attributable
to PJSC LUKOIL
shareholders 63,312 22,766 (21,885) (445) 63,748
EBITDA 159,295 44,460 (23,595) (3,545) 176,615
Income tax
expense (18,819)
Finance income 4,036
Finance costs (11,026)
Depreciation,
depletion and
amortisation (87,058)
Profit for
the period
attributable
to PJSC LUKOIL
shareholders 63,748
-------------------- --------------- ----------------- ---------- ----------- ------------
For the six months ended 30 June 2016
Refining,
Exploration marketing Corporate
and production and distribution and other Elimination Consolidated
-------------------- --------------- ----------------- ---------- ----------- ------------
Sales and other
operating revenues
Third parties 95,462 2,400,709 20,462 - 2,516,633
Inter-segment 693,546 31,983 25,906 (751,435) -
-------------------- --------------- ----------------- ---------- ----------- ------------
Total revenues 789,008 2,432,692 46,368 (751,435) 2,516,633
-------------------- --------------- ----------------- ---------- ----------- ------------
Operating expenses 133,623 104,645 9,524 (20,839) 226,953
Selling, general
and administrative
expenses 19,976 66,697 24,903 (18,451) 93,125
Profit (loss)
for the period
attributable
to PJSC LUKOIL
shareholders 117,994 56,211 (68,727) (86) 105,392
EBITDA 261,611 109,991 (66,422) 18 305,198
Income tax
expense (29,723)
Finance income 7,342
Finance costs (21,469)
Depreciation,
depletion and
amortisation (155,956)
Profit for
the period
attributable
to PJSC LUKOIL
shareholders 105,392
-------------------- --------------- ----------------- ---------- ----------- ------------
For the six months ended 30 June 2015
Refining,
Exploration marketing Corporate
and production and distribution and other Elimination Consolidated
-------------------- --------------- ----------------- ---------- ----------- ------------
Sales and other
operating revenues
Third parties 126,470 2,777,380 13,421 - 2,917,271
Inter-segment 867,940 27,680 28,600 (924,220) -
-------------------- --------------- ----------------- ---------- ----------- ------------
Total revenues 994,410 2,805,060 42,021 (924,220) 2,917,271
-------------------- --------------- ----------------- ---------- ----------- ------------
Operating expenses 126,479 87,242 10,808 (13,020) 211,509
Selling, general
and administrative
expenses 20,088 60,740 19,022 (18,637) 81,213
Profit (loss)
for the period
attributable
to PJSC LUKOIL
shareholders 137,754 62,923 (20,875) (12,023) 167,779
EBITDA 312,734 115,273 (20,907) (16,189) 390,911
Income tax
expense (43,692)
Finance income 8,567
Finance costs (22,486)
Depreciation,
depletion and
amortisation (165,521)
Profit for
the period
attributable
to PJSC LUKOIL
shareholders 167,779
-------------------- --------------- ----------------- ---------- ----------- ------------
Geographical segments
For the For the
three three For the For the
months months six months six months
ended ended ended ended
30 June 30 June 30 June 30 June
2016 2015 2016 2015
Sales of crude oil within
Russia 23,404 37,859 44,744 75,232
Export of crude oil and
sales of crude oil by
foreign subsidiaries 340,858 390,764 633,406 771,001
Sales of petroleum products
within Russia 146,110 149,217 276,286 280,196
Export of petroleum products
and sales of petroleum
products by foreign subsidiaries 740,748 817,644 1,365,635 1,620,430
Sales of chemicals within
Russia 8,915 6,296 18,094 9,394
Export of chemicals and
sales of chemicals by
foreign subsidiaries 8,804 8,875 18,962 17,089
Sales of gas and gas products
within Russia 8,582 9,533 17,820 18,831
Export of gas products
and sales of gas and gas
products by foreign subsidiaries 19,877 21,187 44,285 48,859
Sales of energy and related
services within Russia 11,642 11,523 30,678 29,420
Sales of energy and related
services by foreign subsidiaries 2,797 1,719 6,525 4,209
Other sales within Russia 12,677 9,797 22,896 18,628
Other export sales and
other sales of foreign
subsidiaries 14,545 12,552 37,302 23,982
---------------------------------- --------- --------- ----------- -----------
Total sales 1,338,959 1,476,966 2,516,633 2,917,271
---------------------------------- --------- --------- ----------- -----------
For the three months ended 30 June 2016
Russian
Federation International Elimination Consolidated
------------------------------------ ----------- ------------- ----------- ------------
Sales and other operating
revenues
Third parties 224,961 1,113,998 - 1,338,959
Inter-segment 272,210 732 (272,942) -
------------------------------------ ----------- ------------- ----------- ------------
Total revenues 497,171 1,114,730 (272,942) 1,338,959
------------------------------------ ----------- ------------- ----------- ------------
Operating expenses 81,746 29,386 2,577 113,709
Selling, general and administrative
expenses 24,937 21,286 (921) 45,302
Profit for the period attributable
to PJSC LUKOIL shareholders 58,503 6,049 (1,985) 62,567
EBITDA 125,434 35,635 (1,350) 159,719
------------------------------------ ----------- ------------- ----------- ------------
For the three months ended 30 June 2015
Russian
Federation International Elimination Consolidated
------------------------------------ ----------- ------------- ----------- ------------
Sales and other operating
revenues
Third parties 229,945 1,247,021 - 1,476,966
Inter-segment 320,174 1,474 (321,648) -
------------------------------------ ----------- ------------- ----------- ------------
Total revenues 550,119 1,248,495 (321,648) 1,476,966
------------------------------------ ----------- ------------- ----------- ------------
Operating expenses 78,785 29,575 (2,532) 105,828
Selling, general and administrative
expenses 20,121 21,032 (1,125) 40,028
Profit (loss) for the period
attributable to PJSC LUKOIL
shareholders 68,049 (3,397) (904) 63,748
EBITDA 125,477 51,775 (637) 176,615
------------------------------------ ----------- ------------- ----------- ------------
For the six months ended 30 June 2016
Russian
Federation International Elimination Consolidated
------------------------------------ ----------- ------------- ----------- ------------
Sales and other operating
revenues
Third parties 429,952 2,086,681 - 2,516,633
Inter-segment 509,437 1,327 (510,764) -
------------------------------------ ----------- ------------- ----------- ------------
Total revenues 939,389 2,088,008 (510,764) 2,516,633
------------------------------------ ----------- ------------- ----------- ------------
Operating expenses 155,859 61,275 9,819 226,953
Selling, general and administrative
expenses 48,874 46,058 (1,807) 93,125
Profit for the period attributable
to PJSC LUKOIL shareholders 99,012 7,277 (897) 105,392
EBITDA 219,209 86,517 (528) 305,198
------------------------------------ ----------- ------------- ----------- ------------
For the six months ended 30 June 2015
Russian
Federation International Elimination Consolidated
------------------------------------ ----------- ------------- ----------- ------------
Sales and other operating
revenues
Third parties 444,517 2,472,754 - 2,917,271
Inter-segment 648,487 2,757 (651,244) -
------------------------------------ ----------- ------------- ----------- ------------
Total revenues 1,093,004 2,475,511 (651,244) 2,917,271
------------------------------------ ----------- ------------- ----------- ------------
Operating expenses 147,953 62,236 1,320 211,509
Selling, general and administrative
expenses 42,109 41,357 (2,253) 81,213
Profit for the period attributable
to PJSC LUKOIL shareholders 179,874 795 (12,890) 167,779
EBITDA 303,605 102,648 (15,342) 390,911
------------------------------------ ----------- ------------- ----------- ------------
In the International segment the Group receives the most
substantial revenues in Switzerland and the USA.
For the For the
three three For the For the
months months six months six months
ended ended ended ended
30 June 30 June 30 June 30 June
2016 2015 2016 2015
------------------- -------- -------- ----------- -----------
Sales revenues
in Switzerland 641,323 683,645 1,148,389 1,368,906
in the USA 127,777 130,394 210,305 212,498
------------------- -------- -------- ----------- -----------
These amounts are attributed to individual countries based on
the jurisdiction of subsidiaries making the sale.
Note 29. Fair value
There are the following methods of fair value measurement based
on the valuation technique:
Level 1: quoted prices (unadjusted) in active markets for
identical assets or liabilities;
Level 2: inputs other than quoted prices included within Level 1
that are observable for the asset or liability,
either directly or indirectly;
Level 3: unobservable inputs.
The following table shows the carrying amounts and fair values
of financial assets and financial liabilities included in the
consolidated statement of financial position at 30 June 2016 and 31
December 2015.
Fair value
--------------- --------- ---------------------------
30 June Carrying Level Level Level
2016 amount 1 2 3 Total
--------------- --------- -------- ------- -------- --------
Financial
assets:
Commodity
derivative
contracts 14,640 - 14,640 - 14,640
Available
for sale
securities 3,813 - - 3,813 3,813
--------------- --------- -------- ------- -------- --------
Financial
liabilities:
Commodity
derivative
contracts 16,969 - 16,969 - 16,969
Long-term
debt 799,520 376,856 - 452,253 829,109
--------------- --------- -------- ------- -------- --------
Fair value
--------------- --------- ---------------------------
31 December Carrying Level Level Level
2015 amount 1 2 3 Total
--------------- --------- -------- ------- -------- --------
Financial
assets:
Commodity
derivative
contracts 41,648 - 41,648 - 41,648
Available
for sale
securities 4,045 - - 4,045 4,045
--------------- --------- -------- ------- -------- --------
Financial
liabilities:
Commodity
derivative
contracts 10,827 - 10,827 - 10,827
Long-term
debt 820,493 400,140 - 392,952 793,092
--------------- --------- -------- ------- -------- --------
The fair values of cash and cash equivalents (Level 1), current
and long-term accounts receivable (Level 3) are approximately equal
to their value as disclosed in the consolidated statement of
financial position. The fair value of long-term receivables was
determined by discounting with estimated market interest rates for
similar financing arrangements. The fair value of long-term loans
(Level 3) was determined as a result of discounting using estimated
market interest rates for similar financing arrangements. These
amounts include all future cash outflows associated with the
long-term debt repayments, including the current portion and
interest. Market interest rates mean the rates of raising long-term
debt by companies with a similar credit rating for similar periods,
repayment schedules and similar other main terms. The fair value of
bonds (Level 1) was determined based on market quotations at 30
June 2016 and 31 December 2015.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR LLFLETFIAFIR
(END) Dow Jones Newswires
August 30, 2016 02:00 ET (06:00 GMT)
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