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NOVATEK Announces Consolidated IFRS Results for the Year Ended 31 December 2017
Mark Gyetvay, Deputy Chairman of the Management Board
Alexander Nazarov, Head of IR
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Maria Dokuchaeva, Press-secretary
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21 February 2018
Moscow, 21 February 2018. PAO NOVATEK today released its audited consolidated financial statements for the year ended 31 December 2017 prepared in accordance with International Financial Reporting Standards (“IFRS”).
IFRS Financial Highlights
(in millions of Russian roubles except as stated)
* Excluding the effect from disposal of interests in joint ventures.
** Excluding the effects from the disposal of interests in joint ventures, as well as foreign exchange gains (losses).
For the twelve months ended 31 December 2017, our total revenues amounted to RR 583.2 billion and Normalized EBITDA, including our share in EBITDA of joint ventures, totalled RR 256.5 billion, representing year-on-year increases of 8.5% and 5.8%, respectively. The increases in total revenues and Normalized EBITDA were largely due to an increase in average realized liquids and natural gas prices. In addition, in December 2017, after the commencement of LNG production at the first train of our Yamal LNG project, NOVATEK sold its first cargo of LNG to international markets.
Profit attributable to shareholders of PAO NOVATEK decreased to RR 156.4 billion (RR 51.85 per share), or by 39.3%, as compared to 2016. In 2016, our profit was significantly impacted by the sale of a 9.9% equity stake in Yamal LNG and by the foreign exchange differences (including at the joint ventures level). Excluding these effects, Normalized profit attributable to shareholders of PAO NOVATEK increased to RR 156.2 billion (RR 51.78 per share), or by 16.8%, as compared to 2016.
Hydrocarbon Production and Purchased Volumes
Hydrocarbon Sales Volumes
In 2017, natural gas sales volumes amounted to 65.0 billion cubic meters (bcm), representing a 0.5% increase as compared to 2016, due to a slight increase in volumes sold in the Russian Federation, as well as the commencement of sales of LNG purchased from our joint venture Yamal LNG to international markets from December 2017. As at 31 December 2017, our cumulative natural gas inventory balances in the Underground Gas Storage Facilities, the Gas Transmission System and own pipeline infrastructure totaled 1.0 bcm as compared to 0.8 bcm at the end of 2016.
In 2017, our liquid hydrocarbons sales volumes amounted to 15.9 million tons, representing a 5.4% decrease in volumes sold as compared to 2016. The decrease was due to a natural decline in gas condensate production volumes at mature fields of our subsidiaries and joint ventures. As at 31 December 2017, we recorded 962 mt of liquid hydrocarbons in transit or storage and recognized as inventory as compared to 903 mt at 31 December 2016.
In 2017, we significantly increased our resource base in the main region of our activities, the YNAO and adjacent areas, including the purchase in the fourth quarter of 2017 of two producing fields (the West-Yaroyakhinskoye and the Syskonsyninskoye) contributing to our production maintenance program.
Selected Items of Consolidated Statement of Financial Position
(in millions of Russian roubles)
The full set of audited consolidated IFRS financial statements for the year ended 31 December 2017, the notes thereto and Management’s Discussion and Analysis of Financial Condition and Results of Operations are available on the Company’s web site (www.novatek.ru).
PAO NOVATEK is the largest independent natural gas producer in Russia, and in 2017, entered the global gas market by successfully launching the Yamal LNG project. Founded in 1994, the Company is engaged in the exploration, production, processing and marketing of natural gas and liquid hydrocarbons. The Company’s upstream activities are concentrated mainly in the prolific Yamal-Nenets Autonomous Region, which is the world’s largest natural gas producing area and accounts for approximately 80% of Russia’s natural gas production and approximately 15% of the world’s gas production. NOVATEK is a public joint stock company established under the laws of the Russian Federation. The Company’s shares are listed in Russia on Moscow Exchange (MOEX) and the London Stock Exchange (LSE) under the ticker symbol “NVTK”.
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