TIDMLKOD
RNS Number : 7665R
PJSC LukOil
04 March 2019
PRESS RELEASE
MARCH 4, 2019
LUKOIL RELEASES FINANCIAL RESULTS UNDER IFRS FOR 2018
PJSC LUKOIL today released its audited consolidated financial
statements for 2018 prepared in accordance with the International
Financial Reporting Standards (IFRS).
Financial highlights
4Q 3Q 12 12
2018 2018 2018 2017
-------- -------- ----------------------------------- -------- ------------
(billion rubles)
2,043.2 2,305.9 Sales 8,035.9 5,936.7
278.3 321.8 EBITDA 1,114.8 831.6
274.1 312.7 EBITDA ex. West Qurna-2 1,089.4 814.4
Profit for the period attributable
159.0 183.8 to LUKOIL shareholders 619.2 418.8
113.3 111.4 Capital expenditures 451.5 511.5
212.2 159.8 Free cash flow 555.1 247.0
136.6 196.1 Adjusted free cash flow(*) 566.6 286.3
-------- -------- ----------------------------------- -------- ------------
(*) Free cash flow before changes in working capital, West
Qurna-2 project and income tax on sale of JSC
Arkhangelskgeoldobycha.
Sales
Our sales for 2018 increased by 35.4% year-on-year to RUB
8,035.9 bln. The growth was mainly due to higher hydrocarbon
prices, weaker ruble, increase in oil trading volumes, as well as
higher gas sales volumes. Lower international wholesale sales
volumes of refined products as a result of higher domestic retail
sales volumes and lower refined products trading volumes
constrained the sales growth.
In the fourth quarter of 2018 sales amounted to RUB 2,043.2 bln,
11.4% lower quarter-on-quarter primarily due to lower prices for
crude oil and refined products, as well as lower oil trading
volumes and lower sales volumes of refined products outside Russia.
The decline was partly offset by weaker ruble.
EBITDA
EBITDA for 2018 increased to RUB 1,114.8 bln, which is 34.1%
higher year-on-year. The growth was supported by the increased
share of high-margin barrels in the total crude oil production,
higher gas production in Uzbekistan, higher oil production in
Russia in the second half of 2018, lower lifting costs per barrel,
as well as higher sales volumes via premium marketing channels.
Besides abovementioned factors EBITDA growth was driven by higher
hydrocarbon prices and weaker ruble.
In the fourth quarter of 2018, EBITDA amounted to RUB 278.3 bln,
13.5% lower quarter-on-quarter mainly due to lower crude oil
prices, export duty lag effect, as well as negative inventory
effect at our refineries.
Profit for the period
In 2018, profit attributable to shareholders amounted to RUB
619.2 bln, 47.8% higher year-on-year. The growth was constrained by
higher DD&A due to the launch of new production facilities.
In the fourth quarter of 2018, profit attributable to
shareholders amounted to RUB 159.0 bln, 13.5% down
quarter-on-quarter. The decrease was due to lower EBITDA.
Capital expenditures
In 2018, capital expenditures amounted to RUB 451.5 bln, 11.7%
down year-on-year. The decrease was mainly driven by lower
investments in gas projects in Uzbekistan due to completion of main
construction works. The decrease was partly offset by higher
investments in refining segment due to the start of construction
works at the delayed coker complex at Nizhny Novgorod refinery.
In the fourth quarter of 2018, capital expenditures increased by
1.7% quarter-on-quarter to RUB 113.3 billion.
Free cash flow
In 2018, free cash flow more than doubled year-on-year and
amounted to RUB 555.1 bln. The increase was due to higher operating
cash flow before changes in working capital as well as lower
capital expenditures.
In the fourth quarter of 2018, free cash flow amounted to RUB
212.2 bln, 32.8% higher quarter-on-quarter due to decrease in
working capital as a result of lower prices for crude oil and lower
trading volumes.
Operational highlights
4Q 3Q 12M 12M
2018 2018 2018 2017
------ ------ ------------------------------- ------- ----------
2,391 2,362 Hydrocarbon production, Kboepd 2,347 2,269
2,371 2,327 ex. West Qurna-2 2,319 2,235
Liquid hydrocarbon production,
1,821 1,817 Kbpd 1,806 1,804
1,801 1,782 ex. West Qurna-2 1,778 1,770
8.9 8.5 Gas production, bcm 33.5 28.9
Production of refined products
16.3 16.6 at own refineries, mln tonnes 63.8 63.5
------ ------ ------------------------------- ------- ----------
In 2018 LUKOIL Group's average hydrocarbon production excluding
West Qurna-2 project was 2,319 thousand boe per day, which is 3.8%
higher year-on-year.
In the fourth quarter of 2018 production excluding West Qurna-2
project increased by 1.9% quarter-on-quarter and averaged 2,371
thousand boe per day.
The increase was mainly driven by the development of gas
projects in Uzbekistan.
Liquid hydrocarbons
In 2018, our liquids production excluding West Qurna-2 project
increased by 0.5% year-on-year and averaged 1,778 thousand barrels
per day. In the fourth quarter of 2018, liquids production averaged
1,801 thousand barrels per day, up 1.1% quarter-on-quarter. The
growth was primarily due to higher production volumes at our
high-margin fields in the Caspian Sea and Timan Pechora.
In 2018 active development of the priority projects continued.
The second production platform was launched at the V. Filanovsky
field in the Caspian Sea with four production wells drilled from
the platform by the end of the year. In 2018, oil production at the
field increased by 32% year-on-year, to 6.1 million tonnes.
The second production platform was commissioned and the drilling
program was launched at the Yu. Korchagin field resulting in a 23%
increase in average daily crude oil production in the fourth
quarter of 2018 compared to the first quarter of 2018.
The development of the Yaregskoe field and Permian reservoir of
the Usinskoe field, including the launch of new steam-generating
capacities, allowed to increase high viscosity oil production in
2018 by 25% year-on-year, to 4.3 million tonnes.
Oil and gas condensate production at the Pyakyakhinskoe field in
West Siberia increased in 2018 by 4% year-on-year, to 1.6 million
tonnes.
The share of the abovementioned five projects in the LUKOIL
Group's oil production excluding the West Qurna-2 project amounted
to 15% in 2018, 3 percentage points up year-on-year.
Gas
In 2018, LUKOIL Group's gas production was 33.5 billion cubic
meters, which is 16.2% higher year-on-year. In the fourth quarter
of 2018 gas production was 8.9 billion cubic meters, 4.6% up
quarter-on-quarter.
The main driver of gas production growth was the development of
projects in Uzbekistan. As a result of the launch of new gas
treatment facilities, the Group's share in production at Kandym and
Gissar projects in 2018 increased to 13.4 billion cubic meters,
which is 66.7% higher year-on-year.
Refined products
Refinery output at the LUKOIL Group's refineries in 2018
increased by 0.4% year-on-year and amounted to 63.8 million tonnes
of refined products. The increase was due to higher utilization
rates at refineries in Perm, Volgograd, Italy and Romania.
In the fourth quarter of 2018, we produced 16.3 million tonnes
of refined products, 1.8% down quarter-on-quarter due to scheduled
maintenance works at refineries in Nizhny Novgorod and Italy.
In 2018 output volumes at our refineries in Russia increased by
0.6% year-on-year and amounted to 41.0 million tonnes. Production
of fuel oil continued to decline which resulted in the decrease of
its share in the product basket to 11.7%, or by 1.3 percentage
point as compared to 2017. The improvement in the efficiency of
refineries in Russia was also driven by the optimization of
capacity utilization, including the cross-supplies of semi-finished
products between the refineries and change in the feedstock mix, as
well as cost optimization measures.
Refinery output at the Group's refineries in Europe was almost
flat year-on-year and amounted to 22.8 million tonnes. Higher
production at refineries in Romania and Italy was offset by lower
volumes produced at Burgas refinery due to the scheduled
maintenance works. Refining depth at the Group's refineries in
Europe increased by 1.1 percentage point year-on-year and reached
88.0% due to lower production of fuel oil which decreased by 9%
year-on-year.
http://www.rns-pdf.londonstockexchange.com/rns/7665R_1-2019-3-4.pdf
http://www.rns-pdf.londonstockexchange.com/rns/7665R_2-2019-3-4.pdf
http://www.rns-pdf.londonstockexchange.com/rns/7665R_3-2019-3-4.pdf
Information:
The full set of audited consolidated IFRS financial statements
of PJSC "LUKOIL" for the year ended 31 December 2018 and the
related notes as well as Management's Discussion and Analysis of
Financial Condition and Results of Operations are available on the
Company's websites: www.lukoil.com and www.lukoil.ru.
PJSC LUKOIL is one of the largest publicly traded, vertically
integrated oil and gas companies in the world in terms of proved
hydrocarbon reserves and production; and the second largest
producer of crude oil in Russia. Established in 1991, the Company
currently operates in more than 30 countries with core upstream
assets located in Russia. The full production cycle includes oil
and gas exploration, production and refining; production of
petrochemicals and lubricants; power generation; marketing and
distribution providing LUKOIL with maximum synergies from its
activities. The Company's shares are listed in Russia on Moscow
Exchange under the ticker "LKOH" and depositary receipts are listed
on the London Stock Exchange under the ticker "LKOD".
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
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contact rns@lseg.com or visit www.rns.com.
END
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