Key Performance Results
|Financial results bn Rub.||1H 2018||H2 2017||Variation|
|Profit attributable to “RussNeft” shareholders||1.8||3.2||(44%)|
“RussNeft” showed significant growth of financial indicators in 1H 2018 at flat production. The revenue grew by 53% and amounted to 88.4 bn Rub. EBITDA was 24.8 bn Rub., by 103% higher against the same period last year. The growth of financial indicators was fueled by the increase in oil prices, as well as by involving the so called high-margin oil into production.
Profit attributable to “RussNeft” shareholders amounted to 1.8 bn Rub., which is by 44% lower against the same period last year. The decrease of the profit was mainly determined by non-cash loss from revaluation of the fair value of the derivatives (options), as well as by the impact form negative exchange rate differences.
The adjusted profit, excluding these factors, shows 3.8x growth and equals to 9.8 bn Rub. 1H 2018 financial indicators represent significant improvement of the Company’s operational profile.
|Operating results||1H 2018||1H 2017||Variation|
|Oil production, mln tons, incl.:||3.744||3.721||1%|
|Oil production in the Russian Federation, mln tons||3. 497||3. 472||1%|
|Oil production under PSAs thous. tons||247||249||(1)%|
|Gas production, mln cbm||1 336||1 141||17%|
The management of the Company endeavors to maintain the current production rate, as well as to reduce the hydrocarbon production expenses by producing high-margin oil and shut-down of non-profitable wells within current macroeconomic conditions. The oil production output in 1H 2018 stays commensurate with the last year.
|Capital Investment (development), bn Rub.||14.4||12.7||13%|
|Geological anfd exploration works||0.1||0.3||(67)%|
The Company’s strategy involves active investments, targeted at increasing production drilling volumes, building new infrastructure and upgrading the existing one for maintaining flat production, reaching organic growth in the mid-term. The scale of investments in 1H 2018 reached 14.4 bn Rub., increasing 1H 2017 figures by 13% or by 1,7 bn Rub.
Net debt of the Company in the reporting year totaled up to 83,8 bn Rub. VTB Bank (PJSC) acts as the major creditor. Insignificant variation (increase by 5%) is related mainly to dynamics of the USD exchange rate. Efficient cooperation between the managers and the shareholders allowed the Company to reach target indicators for compliance with the financial and production covenants, interest payments on principal of the loan were timely and fully paid.
Net debt/EBITDA ratio shows steady decline, for the first in the Company’s history this ratio equals 2, signaling of the financial sustainability stabilization.