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NOVATEK announces consolidated IFRS results for the year ended 31 December 2013

Moscow, 25 February 2014. OAO NOVATEK today released its audited consolidated financial statements for the years ended 31 December 2013 and 2012 prepared in accordance with the International Financial Reporting Standards (“IFRS”). 

IFRS Financial and Operational Highlights
(in millions of Russian roubles)

 

FY 2013

FY 2012

Oil and gas sales

297,499

210,246

Other revenues

659

727

Total revenues

298,158

210,973

Operating expenses

(192,761)

(125,775)

Gain (loss) on disposal of interests in subsidiaries and
joint ventures

37,649

(60)

Other operating income

880

196

Profit from operations

143,926

85,334

Normalized EBITDA*

121,791

95,166

Finance income (expense)

(6,684)

2,986

Share of profit (loss) of joint ventures, net of income tax

(112)

(2,105)

Profit before income tax

137,130

86,215

Profit

109,945

69,441

Profit attributable
to OAO NOVATEK shareholders

110,006

69,458

Normalized Profit attributable
to OAO NOVATEK shareholders*

79,825

69,518

Basic and diluted earnings per share

(in Russian roubles)

36.31

22.89

Normalized basic and diluted earnings per share*
(in Russian roubles)

26.35

22.91

* excluding gain (loss) on disposal of interests in subsidiaries and joint ventures.

Total revenues grew by 41.3% year-on-year to RR 298.2 billion for the twelve months ended 31 December 2013 from RR 211.0 billion in 2012. The growth was due to an increase in hydrocarbon sales volumes and higher natural gas and liquids prices. 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 petroleum product sales from the Ust-Luga Gas Condensate Fractionation and Transshipment Complex launched in June 2013.

In 2013, we recorded a year-on-year increase of 28.0% in our Normalized EBITDA, which totaled RR 121.8 billion (adjusted for the gains from the sale of a 20% stake in Yamal LNG joint venture and an asset swap, whereby NOVATEK’s 51% stake in Sibneftegas was swapped for 40% stake in Artic Russia B.V.). The growth in our Normalized EBITDA was positively impacted by the expansion of the share of liquids in our total hydrocarbon volumes sales mix, as well as the enhanced margins from processing stable gas condensate at the Ust-Luga complex.

In 2013, Normalized Profit attributable to NOVATEK shareholders, adjusted for the net gains from the asset sale and swap deals, increased by 14.8% to RR 79.8 billion, or RR 26.35 per share, as compared to RR 69.5 billion, or RR 22.91 per share, in 2012. The dynamics of profit was negatively impacted by non-cash foreign exchange effect. Net of this effect our Normalized Profit increased by 28.4%.


Selected Operating Highlights 

Production and Purchased Volumes

FY 2013

FY 2012

Natural gas production, million cubic meters (mmcm)

52,214

50,507

Natural gas purchases from joint ventures, mmcm

7,799

5,335

Other purchases of natural gas, mmcm

6,443

3,533

Total natural gas production and purchases, mmcm

66,456

59,375

Liquids production, thousand tons (mt)

4,327

4,193

Liquids purchases from joint ventures, mt

1,170

259

Other purchases of liquids, mt

15

38

Total liquids production and purchases, mt

5,512

4,490

Sales Volumes

FY 2013

FY 2012

Natural gas, mmcm

64,152

58,880

including sales to end-users, mmcm

57,021

40,806

Stable gas condensate, mt

2,117

2,847

Ust-Luga products, mt

1,606

-

Liquefied petroleum gas, mt

1,078

905

Crude oil, mt

627

442

In 2013, natural gas sales volumes increased to 64.2 billion cubic meters (bcm), or by 9.0%, as compared with 2012, mainly due to production growth at the Yurkharovskoye field and the fields of our joint ventures. The share of end-users in our total gas volumes sales mix increased from 69% in 2012 to 89% in 2013. As at 31 December 2013, the total amount of natural gas recorded as inventory aggregated approximately 3.3 bcm.

Liquid hydrocarbon sales volumes aggregated 5,438 thousand tons in 2013 representing an increase of 29.4% as compared with 2012. The increase is due to higher gas condensate production at our joint ventures and an increase in crude oil output at the East-Tarkosalinskoye field. As at the year-end, 409 thousand tons of stable gas condensate and oil products were in transit or storage and recognized as inventory, as compared with 461 thousand tons of stable gas condensate as at 31 December 2012.

Selected Balance Sheet Items
(in millions of Russian roubles

 

 

31December 2013

31December 2012

ASSETS

 

 

Non-current assets

515,569

404,890

Property, plant and equipment

243,688

197,376

Investments in joint ventures

210,066

189,136

Total current assets

82,426

58,243

Total assets

597,995

463,133

LIABILITIES AND EQUITY

 

 

Non-current liabilities

165,065

116,702

Long-term debt

141,595

97,805

Current liabilities

59,873

55,130

Total liabilities

224,938

171,832

Equity attributable to

OAO NOVATEK shareholders

 

370,198

290,050

Non-controlling interest

2,859

1,251

Total equity

373,057

291,301

Total liabilities and equity

597,995

463,133

The full set of audited consolidated IFRS financial statements for the years ended
31 December 2013 and 2012 and the related notes thereto as well as Management’s Discussion and Analysis of Financial Condition and Results of Operations are available on the Company’s website (www.novatek.ru).


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. 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”.