TIDMLKOD
RNS Number : 4370Q
PJSC LukOil
29 November 2016
LUKOIL ANNOUNCES CONSOLIDATED IFRS RESULTS FOR THE THIRD QUARTER
AND NINE MONTHS OF 2016
PJSC LUKOIL ("LUKOIL" or "Company") today released its condensed
interim consolidated financial statements as of and for the three
and nine months ended 30 September 2016 prepared in accordance with
International Financial Reporting Standards (IFRS).
Financial highlights
3Q 2Q 9M 9M
2016 2016 (million rubles) 2016 2015
-------------- -------------- ---------------------------- -------------- --------------
1,309,488 1,338,959 Sales 3,826,121 4,381,324
165,890 189,571 EBITDA* 547,453 630,418
EBITDA* excluding
160,436 182,681 West Qurna-2 513,615 523,058
Profit attributable
54,803 62,567 to LUKOIL shareholders 160,195 356,172
Capital expenditures
including non-cash
120,615 118,886 items 362,062 447,506
104,525 56,991 Free cash flow 197,931 171,196
-------------- -------------- ---------------------------- -------------- --------------
*- profit from operating activities before depreciation,
depletion and amortization.
In the third quarter of 2016, our sales decreased by 2.2%
compared to the second quarter of 2016 resulting primarily from
lower international trading volumes.
EBITDA decreased by 12.5% quarter-on-quarter mainly because of
negative crude oil export duty time lag effect, which was partially
offset by higher refining margins in Russia. Profit attributable to
shareholders was 54.8 bln RUB, down 12.4% from the second quarter
of 2016.
Free cash flow increased by 83.4% compared to the second quarter
of 2016 to
104.5 bln RUB. As a result, free cash flow for the nine months
of 2016 amounted to 197.9 bln RUB.
In the third quarter of 2016, our capital expenditures were
almost flat compared to the previous quarter. As a result, capital
expenditures for the nine months of 2016 amounted to 362.1 bln RUB,
which is 19.1% lower compared to the corresponding period of 2015.
This decrease was mainly a result of completed major upgrade
program at our Russian refineries, moving to the maintenance oil
production stage at West Qurna-2 project in Iraq, decrease in
exploration drilling at our international offshore projects and
overall cost optimization program. Investments into our growth
projects in Timan-Pechora and the Caspian Sea were increased.
Our nine months 2016 financial results were impacted by lower
average international hydrocarbon prices, an increase in mineral
oil extraction tax base rate, a decrease in compensation amount
from West Qurna-2 project, a decline in refining margins as well as
an increase in transportation tariffs. These factors were partially
offset by positive effect of ruble depreciation to US dollar and
Euro on our sales and EBITDA. Among other positive factors were
higher refinery throughput volumes, substantial improvement in the
refined product slate, an increase in sales via high margin
channels and effective cost control.
Our EBITDA for the nine months of 2016 excluding West Qurna-2
project remained practically unchanged compared to the nine months
of 2015.
Significant decrease in profit attributable to shareholders for
the nine months of 2016 was mainly due to the negative non-cash
impact from ruble appreciation during the nine months of 2016
compared to the positive impact from ruble depreciation during the
nine months of 2015.
Operational highlights
3Q 2Q 9M 9M
2016 2016 2016 2015
------ -------- -------------------------------------------- ------ ------
Hydrocarbons production, mln
194.9 196.9 boe 606.0 647.7
188.3 190.7 excluding West Qurna-2 575.3 595.8
167.0 167.0 Liquid hydrocarbons, mln barrels 516.7 560.1
160.4 160.8 excluding West Qurna-2 485.9 508.2
4.7 5.1 Gas available for sale, bcm 15.2 14.9
16.2 15.5 Production of refined products 46.6 45.3
at own refineries, mln t
-------- ------ -------------------------------------------- ------ ------
In the nine months of 2016, our hydrocarbon production was 606.0
mln boe (2.2 mln boe per day), which is 6.4% lower compared to the
same period of 2015. The decline was mainly due to lower volumes of
compensation crude oil from the West Qurna-2 project, disposal of
our share in Caspian Investment Resources Ltd in 2015, as well as
natural production decline at our brownfields in West Siberia.
We achieved oil production growth in Timan-Pechora and the Urals
region of 3.7% and 1.5%, respectively, and our marketable gas
production increased by 2.0% mainly driven by our projects in
Uzbekistan, Kazakhstan and Azerbaijan and commencement of
marketable gas production at the Yu. Korchagin field in the Caspian
Sea. Oil production dynamics in Russia was positively influenced by
start of pilot production on offshore V. Filanovsky and onshore
Pyakyakhinskoe fields during the third quarter of 2016.
In the first nine months of 2016, production of refined products
at our refineries increased by 2.8% compared to the corresponding
period of 2015. We achieved substantial improvement of our product
slate due to the launch of new facilities in 2015 and 2016.
Refining depth at our Russian refineries in the third quarter of
2016 increased by 3.3 percentage points to 85.1% compared to the
third quarter of 2015. We also undertook measures on optimizing
capacity utilization at our refineries in Russia, which resulted in
additional efficiency gains.
Full set of condensed interim consolidated financial statements
prepared in accordance with IFRS as of and for the three and
nine-month period ended 30 September 2016 is available on the
Company's web sites: www.lukoil.com and www.lukoil.ru.
These condensed interim consolidated financial statements have
been prepared by the Company in accordance with IFRS and have not
been audited by our independent auditor. If these financial
statements are audited in the future, the audit could reveal
discrepancies, and we cannot give any assurance that any such
discrepancies would not be material.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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