Helleniq Gds S Regulatory News (HLPD)

31 Aug 2006 09:45

Hellenic Petroleum S.A.31 August 2006 August 30, 2006 HALF-YEAR 2006 FINANCIAL RESULTS (In accordance with International Financial Reporting Standards) Operations-driven profitability improvement leads to 24% increase in Net Income despite weaker environment Hellenic Petroleum Group reported first half Consolidated Net Income of €175million, up 24%, corresponding to €0.57 per share (EPS). Second quarterConsolidated Net Income amounted to €102 million, 42% higher versus firstquarter of this year. The Board of Directors approved an interim dividend of€0.15 per share, 26% of reported EPS. Group Earnings before Interest, Tax, Depreciation and Amortization (EBITDA) forthe first half of 2006 were €330 million. Key financials for the first half of 2006, relative to the same period lastyear, were: • Sales €4,104 million, up 43 % • "Clean" EBIT €175 million, up 39 % • Earnings per share (EPS) €0.57, up 24 % • Operating cash flow measure €281 million, up 33 % • ROACE 12.6 % (12M: July 2005 - June 2006) • ROE 16.5 % (12M: July 2005 - June 2006) • Interim Dividend €0.15 per share Factors affecting first half 2006 results were: (a) Operational profitability: Significant improvement in domestic Refining, Supply & Trading operations aswell as International R&M businesses provided additional profitability exceeding€40 million compared to last year. As a result, comparable "Clean" EBIT(excluding effect of higher crude oil and products prices) is up by 39%. (b) Market environment: On the other hand, the refining environment was less favourable than last year.Despite the persistence of high crude oil prices, average refining marginsremained lower than last year with the exception of complex refining margins(Med cracking margin) in the second quarter. Greek market demand for gasolineproducts and ULSD was up, while the weakening of the US Dollar against the Eurohad a positive impact on the financial results. REFINING, SUPPLY & TRADING Comparable Clean EBIT for Refining, Supply & Trading (adjusted for Inventorygains) was €157 million, 39% up vs. half year 2005. Including inventory gains,EBIT was €235 million (up 8%). Key drivers were: • Second quarter sales volume from the Group's three refineries inGreece was 3.8 million tons (up 12% versus the same period last year), with halfyear sales volume at 8 million tons, up 5%. OKTA sales volume in the secondquarter was 237 thousand tons (up 10% from last year) and half year was 461thousand tons (up 5% from last year). • Improved operations with greater international trading, crude oilfeedstock optimisation and tight control of operating costs resulted in anoverall improved performance, despite softer market conditions. In contrast, the impact of the business environment on first half results waslower by €36 million when compared to last year's. This was due to loweraverage Med refining margins as well as lower inventory gains. RETAIL MARKETING EKO Greece sales volume was up 1% to 1,891 thousand metric tons, with higherdomestic market sales volume and slight decrease aviation and marine fuelmarkets. AEI improved its market share in automotive diesel and maintained itsshare in gasoline in the first half of 2006. The decrease in profitability inthe first half was a result of pressure on profit margins during the early partof the year. Commercial policy changes and increased sales volumes in highervalue products during the last month of the second quarter had little impact onreported results for the six months. International marketing sales volume increase of 8% was the primary reason forthe doubling of Earnings Before Tax. All business reported organicprofitability improvements with the exception of Bulgaria where, despite volumegains, local market driven retail margin pressure affected gross margins. Totalnumber of Hellenic Petroleum retail stations rose to 195 with 21 new stationssince the end of year. PETROCHEMICALS Petrochemicals sales volumes increased by 13% in the first half of 2006 comparedto last year, to 207 thousand tons; with operational profits were up by 75%. POWER GENERATION AND TRADING Higher SMPs and realised crack spreads lead to improved profitability for thepower generation unit in the second quarter. Total power sales for the firsthalf of 2006, including cross-boarder trading and capacity certificates,amounted to €51 million with EBITDA of €10 million. EXPLORATION AND PRODUCTION An important development during the second quarter of 2006 was the announcementof encountering separate hydrocarbon bearing zones during the initialexploratory drill in Murzuk carried out by the consortium of Hellenic Petroleum,Repsol YPF and Woodside. It is estimated that a period of 12 to 18 months isrequired to evaluate and assess commercial developments and expected financialresults. Furthermore, negotiations with EGPC (State owned petroleum company of Egypt) forthe signing of the EPSA (Exploration, Production and Sharing Agreement) in theWest Obayed block in the Western Desert were successfully completed and theagreement initialled. Ratification by the Egyptian Parliament is expected inthe 4th quarter and Hellenic Petroleum is in the process of establishing abranch and a subsidiary company in Egypt to facilitate to carry out itsactivities as operator. It is worth noting that the block was awarded toHellenic Petroleum during the International Bid round conducted by EGPC in early2006. INVESTMENT PLAN Group investments during the second quarter of 2006 amounted to €32 million(first quarter €17 million) and related mostly to small projects for theupgrading and maintenance of industrial sites and network of petrol stations inGreece and abroad. As part of the Group strategy, the Elefsina refinery upgrading project FEED isalready in progress. The technology and licensor for the main Hydrocracker andFlexicoker units has already been decided and awarded as has for most of theancillary utilities and process equipment. FINANCIAL POSITION The sustained high level of international crude oil and product prices as wellas the increase of stocks led to debt levels close to €1 billion similar to lastquarter. As a result, despite the positive operating cash flows (€281 million),debt gearing ratio (D/D&E) remained at 30%. During the period additional creditlines of €300 million were secured through a syndicated multi-currency loanorganized through the newly formed Group Treasury subsidiary, Hellenic PetroleumFinance plc. Key Financial Indicators for the Group are attached: HELLENIC PETROLEUM GROUP HALF YEAR 2006 CONSOLIDATED KEY FINANCIAL RESULTS (Prepared in accordance with IFRS) HALF YEAR • MILLION 2005 2006 % Net Sales 2,863 4,104 43 % EBITDA 311 330 6 % Clean EBIT(1) 126 175 39 % Earnings before Tax 211 255 21 % Net Income 141 175 24 % Earnings per Share (EPS) • 0.46 0.57 24 % Operating Cash Flow (2) 211 281 18 % 31.12.2005 31.3.2006 Net Debt(3) 700 999 -- Debt Gearing (D/D+E) (3) 25% 30 % -- (1) Calculated as Earnings before Interest & Taxes (EBIT), excluding resultsfrom associates and inventory effect. (2) Calculated as EBITDA less capital expenditure. (3) Compared to 31.12.2005 figures. Complete IFRS financial statements are available at the website: www.hellenic-petroleum.gr Consolidated Balance Sheet As at 30 June 2006 31 December 2005 ASSETSNon-current assetsProperty, plant and equipment 1.380.102 1.405.940Intangible assets 92.001 94.859Investments in affiliated companies 358.453 357.858Deferred income tax assets 40.774 42.255Available-for-sale financial assets 2.856 2.092Loans, advances and other receivables 43.651 36.078 1.917.837 1.939.082Current assetsInventories 1.376.558 1.169.098Trade and other receivables 991.980 888.079Cash and cash equivalents 209.853 193.630 2.578.391 2.250.807Total assets 4.496.228 4.189.889 EQUITYShare capital 1.019.963 1.019.963Reserves 536.669 543.642Retained Earnings 678.891 590.933Capital and reserves attributable to Company Shareholders 2.235.523 2.154.538 Minority interest 107.421 101.924 Total equity 2.342.944 2.256.462 LIABILITIESNon- current liabilitiesBorrowings 514.624 539.573Deferred income tax liabilities 20.701 18.645Retirement benefit obligations 139.534 133.747Provisions and other long term liabilities 75.179 67.348 750.038 759.313Current liabilitiesTrade and other payables 574.222 637.043Current income tax liabilities 122.935 153.045Borrowings 697.149 356.360Dividends payable 8.940 27.666 1.403.246 1.174.114Total liabilities 2.153.284 1.933.427Total equity and liabilities 4.496.228 4.189.889 Consolidated Income Statement For the six month period 1 April 2006 to 1 April 2005 to ended 30 June 2006 30 June 2005 30 June 2006 30 June 2005 Sales 4.104.006 2.863.026 2.045.813 1.402.755 Cost of sales (3.678.485) (2.464.840) (1.799.864) (1.185.269) Gross profit 425.521 398.186 245.949 217.486 Selling, distribution and administrative (176.300) (166.616) (87.220) (76.814)expenses Exploration and development expenses (4.638) (6.572) (3.446) (3.156) Other operating (expenses) / income - net 8.723 6.206 2.505 3.279 Operating profit 253.306 231.204 157.788 140.795 Finance costs -net (14.315) (8.393) (8.403) (4.458) Currency exchange gains /(losses) 12.848 (15.918) 879 (9.916) Share of operating profit of associates 3.174 4.280 (2.510) 2.506 Profit before income tax 255.013 211.173 147.754 128.927 Income tax expense (74.371) (68.978) (41.901) (41.991) Profit for the period 180.642 142.195 105.853 86.936 (Less) / Add Minority Interest (6.034) (888) (3.450) (265) Net Income attributable to Equity holders of 174.608 141.307 102.403 86.671the Company Basic and diluted earnings per share 0,57 0,46 0,34 0,28(expressed in Euro per share) Parent Company Balance Sheet As at 30 June 2006 31 December 2005ASSETSNon-current assetsProperty, plant and equipment 633.670 657.028Intangible assets 24.399 26.602Investments in affiliated companies 687.989 685.070Deferred income tax assets 27.706 27.606Available-for-sale financial assets 80 80Loans, advances and other receivables 73 79 1.373.917 1.396.465 Current assetsInventories 1.268.256 1.071.322Trade and other receivables 745.930 726.743Cash and cash equivalents 104.598 75.956 2.118.784 1.874.021Total assets 3.492.701 3.270.486 EQUITYShare capital 1.019.963 1.019.963Reserves 536.669 543.642Retained Earnings 469.435 384.710Total equity 2.026.067 1.948.315 LIABILITIESNon- current liabilitiesBorrowings 309.349 335.187Retirement benefit obligations 113.947 108.711Provisions and other long term liabilities 53.951 46.435 477.247 490.333Current liabilitiesTrade and other payables 498.563 552.055Current income tax liabilities 108.322 135.247Borrowings 373.562 116.870Dividends payable 8.940 27.666 989.387 831.838Total liabilities 1.466.634 1.322.171Total equity and liabilities 3.492.701 3.270.486 Parent Company Income Statement For the six month period 1 April 2006 to 1 April 2005 to ended 30 June 2006 30 June 2005 30 June 2006 30 June 2005 Sales 3.868.744 2.694.771 1.905.308 1.329.208 Cost of sales (3.557.536) (2.402.800) (1.722.272) (1.164.462) Gross profit 311.208 291.971 183.036 164.746 Selling, distribution and administrative (88.564) (87.037) (42.902) (36.813)expenses Exploration and development expenses (4.639) (6.572) (3.446) (3.156) Other operating (expenses) / income - net 169 1.391 3.256 460 Operating profit 218.174 199.753 139.944 125.237 Finance costs -net (6.293) (2.356) (3.826) (1.007) Currency exchange gains /(losses) 8.902 (15.176) (2.202) (10.422) Dividend income 13.443 15.404 13.443 10.694 Profit before income tax 234.226 197.625 147.359 124.502 Income tax expense (63.927) (60.274) (37.653) (38.374) Profit for the period 170.299 137.351 109.706 86.128 Basic and diluted earnings per share 0,56 0,45 0,36 0,28(expressed in Euro per share) This information is provided by RNS The company news service from the London Stock Exchange