15 Nov 2022 07:00
QUARTERLY REPORT
ON THE ECONOMIC-FINANCIAL ACTIVITY OF ROMGAZ GROUP
ON SEPTEMBER 30, 2022 (January 01, 2022 - September 30, 2022)
IDENTIFICATION DETAILS ON REPORT AND ISSUER
Report based on | Law No. 24/2017 on issuers of financial instruments and market operations, republished (Art.69) and ASF Regulation (Financial Supervisory Authority) No. 5/2018 on issuers of financial instruments and market operations (Annex No.13), for the nine-month period ended September 30, 2022 |
Report Date | November 15, 2022 |
Company Name | Societatea Naţională de Gaze Naturale "ROMGAZ" SA |
Headquarters | Mediaş, 4 Constantin I. Motaş Sq., 551130, Sibiu County |
Telephone/fax number | 0040 374 401020 / 0040 269 846901 |
Web/E-mail | www.romgaz.ro / secretariat@romgaz.ro |
Registration Number with the Office of the Trade Registry | J32/392/2001 |
Fiscal Code | RO14056826 |
Legal Entity Identifier (LEI) | 2549009R7KJ38D9RW354 |
Regulated market where company shares are traded | Bucharest Stock Exchange (shares) and London Stock Exchange (GDRs) |
Subscribed and paid in share capital | RON 385,422,400 |
Shares main characteristics | 385,422,400 shares, each with a nominal value of RON 1 Nominative, ordinary, indivisible shares, issued dematerialized and free tradable since November 12, 2013 as SNG - for shares and SNGR - for GDRs |
ROMGAZ GROUP[1] PERFORMANCES
In the first nine months of 2022, Romgaz Group recorded a revenue of RON 10,812.55 million, an increase by 209.24%, namely RON 7,316.02 million, as compared with the revenue achieved in the first 9 months of 2021.
Net profit of RON 2,237.81 million was higher by 93.52%, namely RON 1,081.43 million, as compared with the similar period of the previous year.
Consolidated net profit per share (EPS) was RON 5.81, by 93.5% higher than the one recorded in the first nine months of 2021.
For the reporting period, Romania's estimated natural gas consumption[2] was 78.34 TWh, approximately 14% lower than the consumption recorded in the similar period of 2021.
Thus, Romgaz market share estimated for the first 9 months of 2022, is 50.6%, by 5% higher than the market share recorded in the same period of the previous year.
Natural gas production for the first 9 months of 2022 was 3,687.4 million m3, by 0.5% lower than production recorded in the similar period of last year, namely 19 million m3.
Electricity produced in the reporting period was 839.465 GWh, 97.02% higher (+413.365 GWh) than in the same period of the previous year.
In Q3/2022 Romgaz produced 294.806 GWh, increasing by 71.806 GWh, namely 32.21% higher than in Q3/2021. With this production, Romgaz has a 2.32% market share.
Relevant Financial Results (consolidated)
*RON million*
Q3 2021 | Q2 2022 | Q3 2022 | Δ Q3 (%) | Main indicators | 9M 2021 | 9M 2022 | Δ 9M (%) |
1,246.5 | 3,570.3 | 3,316.5 | 166.06 | Revenue | 3,496.5 | 10,812.5 | 209.24 |
1,469.7 | 3,680.1 | 3,449.3 | 134.69 | Income | 3,727.9 | 11,053.8 | 196.52 |
1,023.0 | 2,792.5 | 2,838.2 | 177.44 | Expenses | 2,378.5 | 8,385.7 | 252.56 |
0.8 | 0.3 | 1.40 | 75.00 | Share of the associates' result | 0.01 | 1.6 | 15,900.00 |
447.5 | 887.9 | 612.5 | 36.87 | Gross profit | 1,349.4 | 2,669.8 | 97.85 |
52.7 | 141.6 | 100.6 | 90.89 | Profit tax | 193.1 | 432.0 | 123.72 |
394.8 | 746.3 | 511.9 | 29.66 | Net profit | 1,156.4 | 2,237.8 | 93.51 |
435.7 | 825.7 | 561.9 | 28.96 | EBIT | 1,311.1 | 2,525.1 | 92.59 |
621.7 | 956.2 | 712.4 | 14.59 | EBITDA | 1,807.3 | 2,895.1 | 60.19 |
1.02 | 1.9 | 1.33 | 29.66 | Earnings per share (EPS) (RON) | 3.0 | 5.81 | 93.52 |
31.67 | 20.90 | 15.43 | -51.28 | Net profit rate (% from Revenue) | 33.07 | 20.70 | -37.41 |
34.95 | 23.13 | 16.94 | -51.53 | EBIT ratio (% from Revenue) | 37.50 | 23.35 | -37.73 |
49.87 | 26.78 | 21.48 | -56.93 | EBITDA ratio (% from Revenue) | 51.69 | 26.78 | -48.19 |
5,918 | 5,884 | 5,909 | -0.15 | Number of employees at the end of the period | 5,918 | 5,909 | -0.15 |
Figures in the table above are rounded, therefore small differences may result upon reconciliation.
Note: income and expenses do not include in-house works capitalized as non-current assets.
A brief overview of the Group's main indicators during the 9M period ended September 30, 2022:
ü Consolidated gross result for the reporting period is higher by 97.85% as compared with the similar period of the previous year (RON +1,320.4 million) due to the following influential factors:
· Consolidated revenue recorded an increase of 209.24% (+ RON 7,316.0 million) compared to 9M 2021;
· Revenues from natural gas sales increased by 210.92% (+ RON 6,296.8 million), quantities sold decreased by 6.22%;
· For the 9M ended September 30, 2022, electricity revenues increased by 592.59% with a 97.02% higher production as compared with the previous period. In 2022 a new tax was introduced for electricity producers (a tax on additional revenue of electricity producers, which later became contribution to the Energy Transition Fund). The tax value was RON 293.9 million;
· consolidated revenue from underground storage activities increased by 65.58%; the unconsolidated revenue from underground storage activities increased by approximately 42.11% as compared with the previous period. The booked capacity increased in 2022-2023 storage cycle by 25.4% as compared to storage cycle 2021-2022;
· consolidated royalty expenses increased by RON 1,145.3 million (+330.1%) as compared to 2021, and tax on additional revenue from gas sales increased by RON 4,558.8 million (+1,252.4%) as compared with the nine-month period of 2021;
· the increased electricity production triggered the increase of net expenses with greenhouse gas emission certificates by RON 80.71 million (+76%);
ü Net profit is RON 2,237.8 million, higher by RON 1,081.5 million than the one recorded in the previous period due to the above mentioned reasons (+93.52%);
ü Romgaz completed in July 2022 the acquisition of all shares issued by ExxonMobil Exploration and Production Romania Limited, which holds 50% of the rights acquired and obligations under the Petroleum Agreement for the eastern area, deep water zone of Neptun XIX offshore Block in the Black Sea. The acquisition price was RON 5,125.6 million, financed both from own sources and from a bank loan of RON 1,606.5 million;
ü Labour productivity increased by 209.71%, as compared to the previous period, from RON 590.83 thousand revenue/employee in the first 9M/2021 to RON 1,829.84 thousand revenue/employee in the similar period of 2022;
ü EPS is RON 5.81, 93.52% higher than in the first 9M/2021;
Operational Results
Q3 2021 | Q2 2022 | Q3 2022 | Δ Q3 (%) | Main Indicators | 9 months 2021 | 9 months 2022 | Δ 9 months (%) |
1,187.3 | 1,207.9 | 1,172.4 | -1.25 | Gas production (million m3) | 3,706 | 3,687 | -0.5 |
84.0 | 83.8 | 82.4 | -1.9 | Petroleum royalty (million m3) | 261 | 259 | -0.8 |
6,528 | 5,239 | 5,030 | -22.9 | Condensate production (tons) | 19,393 | 15,638 | -19.4 |
222.99 | 199.3 | 294.8 | 32.2 | Electricity production (GWh) | 426.07 | 839.47 | 97.0 |
25.3 | 63.7 | 12.3 | -51.4 | Invoiced UGS withdrawal services (million m3) | 1,446.0 | 1,102.4 | -23.8 |
1,070.9 | 702.2 | 1,185.8 | 4.9 | Invoiced UGS injection services (million m3) | 1,629.9 | 1,966.9 | 20.7 |
Note: the information is not consolidated, transactions between Romgaz and Depogaz are included.
During the first 9 months of 2022, Romgaz produced 3,687 million m3 natural gas, 19 million m3 (-0.5%) lower than in the similar period of 2021.
Gas production for the first 9 months of 2022 was influenced by:
ü Implementation of actions to optimize exploitation of natural gas reservoirs;
ü Continuation and extension of rehabilitation projects of the main mature gas reservoirs;
ü Execution of well workover operations in low productivity or inactive wells;
ü Completion of investments in the development of production infrastructure and connection of new wells to this infrastructure.
The volume of gas sold by Romgaz in the reporting period, representing deliveries to customers, without CTE Iernut consumption, decreased by 6.2% as compared with 9M 2021.
The volume of electricity produced as shown in the table below is in close connection with the energy demand, the evolution of prices on competitive markets and the quantity of natural gas allocated to the production of electricity and the efficiency of said activity.
*MWh*
| 2021 | 2022 | Ratio |
1 | 2 | 3 | 4=3/2x100 |
Q1 | 202,073 | 345,337 | 70.90% |
Q2 | 1,010 | 199,323 | 19,634.95% |
Q3 | 222,989 | 294,806 | 132.21% |
9 months | 426,072 | 839,465 | 197.02% |
The full version of the Quarterly Report on the Economic-Financial Activity of Romgaz Group on September 30, 2022 (January - September 2022) and the Consolidated Condensed Interim Financial Statements for the Nine-Month and Three-Month Periods Ended September 30, 2022 (Unaudited), Prepared in Accordance with International Accounting Standard 34, are available on company's website www.romgaz.ro - Section Investors - Interim Reports and on RNS website, at the link bellow:
http://www.rns-pdf.londonstockexchange.com/rns/4257G_1-2022-11-15.pdf
[1] Romgaz Group consists of SNGN Romgaz SA (the "Company"/"Romgaz") as parent company and the subsidiaries Filiala de Înmagazinare Gaze Naturale Depogaz Ploiești SRL ("Depogaz") and Romgaz Black Sea Limited (former ExxonMobil Exploration and Production Romania Limited), both subsidiaries are 100% owned by Romgaz.
[2] Consumption is estimated as, at the date hereof, ANRE did not publish the report on the natural gas market for July-September 2022.