NOVATEK announces third quarter and nine months 2013 IFRS results

Mark Gyetvay, Deputy Chairman of the Management Board
Alexander Nazarov, Head of IR
+7 (495) 730-6013
ir@novatek.ru

 

Maria Dokuchaeva, Press-secretary
+7 (495) 721-2207
press@novatek.ru

 

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06 November 2013

Moscow, 6 November 2013. OAO NOVATEK (“NOVATEK” and/or the “Company”) today released its consolidated interim condensed financial information for the three and nine months ended 30 September 2013 prepared in accordance with International Financial Reporting Standards (“IFRS”).   

IFRS Financial and Operational Highlights
(in millions of Russian roubles unless otherwise stated)
 
3Q 2013
3Q 2012
 
9M2013
9M2012
 
 
Revenues
 
 
75,541
52,345
Oil and gas sales
213,907
150,984
107
169
Other revenues
336
551
75,648
52,514
Total revenues
214,243
151,535
(47,080)
(29,628)
Total operating expenses
(137,749)
(87,762)
36
339
Other operating income (loss)
693
344
28,604
23,225
Profit from operations
77,187
64,117
32,893
25,252
EBITDA
87,054
69,883
(27)
2,345
Total finance income (expense)
(5,406)
2,372
29,224
25,269
Profit before income tax
72,119
64,676
23,432
19,996
Profit (loss)
57,828
50,892
23,458
20,003
Profit (loss) attributable to shareholders
of OAO NOVATEK
57,886
50,911
7.75
6.59
Basic and diluted earnings per share
(in Russian roubles)
19.10
16.78

Total revenues in the third quarter and nine months 2013 increased by 44.1% and 41.4%, respectively, as compared to the corresponding periods of 2012, largely due to an increase in sales volumes and average sales prices of natural gas and liquid hydrocarbons.  The increase in natural gas prices was due to a significant expansion of the share of end-users in our total gas volumes sales mix, changes in the geography of sales in favor of the remote regions, as well as due to an increase in regulated gas prices, whereas the increase in the average price of liquids was mainly due to the start of product sales from the Ust-Luga Gas Condensate Fractionation and Transshipment Complex launched in the second quarter 2013.

In the third quarter 2013, we recorded a year-on-year increase of 30.3% in EBITDA, which totaled RR 32.9 billion. EBITDA for the first nine months 2013 increased by 24.6% over the corresponding nine months in 2012, and totaled RR 87.1 billion. The growth in our EBITDA was positively impacted by the expansion of the share of liquids in our total hydrocarbon volumes sales mix, as well as by the margin from stable gas condensate processing at the Ust-Luga complex.

Profit attributable to shareholders of OAO NOVATEK in the third quarter 2013 increased to RR 23.5 billion (RR 7.75 per share), or by 17.3% as compared to the third quarter 2012. Profit attributable to shareholders of OAO NOVATEK in the first nine months 2013 increased to RR 57.9 billion (RR 19.10 per share), or by 13.7% as compared to the same period of 2012. The dynamics of profit was impacted by non-cash foreign exchange effect.

Production and Purchase Volumes
3Q 2013
3Q 2012
 
9M 2013
9M 2012
12,199
11,609
Natural gas production,
million cubic meters (mmcm)
38,648
37,112
1,744
1,339
Natural gas purchases from joint ventures,
mmcm
5,567
4,016
1,441
840
Other purchases of natural gas,
mmcm
4,920
2,540
15,384
13,788
Total natural gas production and purchases,
mmcm
49,135
43,668
1,045
972
Liquids production, thousand tons
(mt)
3,244
3,079
272
73
Liquids purchases from joint ventures,
mt
776
131
3
4
Other purchases of liquids,
mt
7
9
1,320
1,049
Total liquids production and purchases,
mt
4,027
3,219

  

Sales Volumes
3Q 2013
3Q 2012
 
9M 2013
9M 2012
14,403
13,507
Natural gas, mmcm
47,770
43,004
12,928
8,719
including sales to end-users, mmcm
42,568
29,252
690
-
Ust-Luga products, mt
690
-
241
737
Stable gas condensate, mt
2,083
2,155
257
202
Liquefied petroleum gas, mt
783
664
162
123
Crude oil, mt
463
308

In the third quarter and first nine months 2013, our natural gas sales volumes increased by 6.6% and 11.1%, respectively, as compared to the corresponding periods in 2012, due to growth in production at the Yurkharovskoye field and an increase in purchases of natural gas. At 30 September 2013, we recorded 2,362 million cubic meters of natural gas as inventory in underground storages as compared to 1,309 million cubic meters in the corresponding period of 2012.

In the third quarter and first nine months 2013, our total liquid hydrocarbon sales volumes increased by 27.0% and 28.5%, respectively, as compared to the corresponding periods in 2012. The growth was due to higher volumes of gas condensate purchases from joint ventures and an increase in crude oil and gas condensate production by our subsidiaries. At 30 September 2013, 378 thousand tons of stable gas condensate and oil products were in transit or storage and recognized as inventory, as compared with 268 thousand tons of stable gas condensate as at 30 September 2012.

Selected Items from the Statement of Financial Position
(in millions of Russian roubles) 
  
 
30 September 2013 ASeptember2013
31 December 2012
ASSETS
 
 
Non-current assets
447,713
404,890
Property, plant and equipment
235,441
197,376
 Investments in joint ventures
171,813
189,136
Current assets
53,536
58,243
Assets held for sale
24,306
-
Total assets
525,555
463,133
LIABILITIES AND EQUITY
 
 
Non-current liabilities
162,126
116,702
Long-term debt
139,778
97,805
Current liabilities
27,163
55,130
Total liabilites
 189,289
 171,832
Equity attributable to OAO NOVATEK shareholders
335,073
290,050
Non-controlling interest
1,193
1,251
Total equity
336,266
291,301
Total liabilities and equity
525,555
463,133

The full set of consolidated interim condensed IFRS financial information, the notes thereto and Management’s Discussion and Analysis of Financial Condition and Results of Operations are available on the Company’s web site.


PAO NOVATEK is the largest independent natural gas producer in Russia, and in 2017, entered the global LNG 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. Upstream activities of the Company’s subsidiaries and joint ventures 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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