ZAGREB, May 1, 2019 – In Q1 2019, INA Group net sales revenues increased by 15% from the same period of last year to 4.25 billion kuna, while net profit excluding special items increased to 58 million kuna, the group said in a press release on Tuesday.
“The positive result was driven by the continuation of favourable hydrocarbon prices and increased sales,” the group said.
EBITDA recorded a 12% increase to 539 million kuna, while net profits excluding special items grew to 58 million kuna, a much better result than in Q1 2018, when they totalled one million.
Capital investments in Q1 totalled 618 million kuna, much higher than in Q1 2018, when they totalled 96 million kuna.
Net gearing dropped to 6.6% with net debt at 838 million kuna.
Commenting on the results, INA Management Board President Sandor Fasimon said that after strong results in 2018 the group again achieved a very strong result in Q1.
“INA utilized the market conditions and increased both its sales and EBITDA, revenues growing by 15%, to the level of over 4 billion kuna in just one quarter. Upstream benefited from the stable hydrocarbon prices and production levels. Maturity of INA fields and the natural decline in gas production was offset by the continuous efforts in oil production increase. This was followed by the increase in investments, majority as before focused in Croatia, but also with a visible increase of spending in Egypt.
“Refining operations are marked with a major turnaround in Rijeka refinery, one of the biggest in recent years. This, together with the other investments projects in the company, brought the investment level to 618 million kuna, biggest level in Q1 since 2010.”
This demonstrates INA’s commitment to developing all business activities in a sustainable way, Fasimon said.
“Still, the deteriorated environment and the less favourable refining margins continue to burden the overall results of the segment expected to be mitigated in the future by INA DS New Course 2023 program. Despite the expected lower processing levels, caused by turnaround, INA managed to increase its sales and utilize the market opportunities both domestically and on the core markets, visible by 8% sales increase in Croatia and 23% in Bosnia & Hercegovina. Retail operations also recorded a visible growth of 7%, partly due to expansion of Montenegro network.”
Overall, despite the Q1 2019 being very investment intensive, the company’s financial position stays strong and the low debt levels allow for stable operations and future investments, Fasimon says.
According to data in the report, Exploration and Production EBITDA excluding special items decreased by 18% to 569 million kuna while net sales revenues of the business grew by 3% to 969 million kuna.
Refining and Marketing revenues, including Consumer services and Retail, totalled 4.04 billion kuna, an increase of 15%. CCS EBITDA of Refining and Marketing including Consumer services and Retail excluding special items amounted to 14 million kuna as against a loss of 114 million kuna in the same period last year.
The result was achieved on the back of higher sales volumes in both wholesale and retail and strong sales margins, at a period of significantly lower processing due to a major turnaround in Rijeka Refinery, the company said.
Nonetheless, the loss from the core activity was 102 million kuna, according to the report.
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