Serbia: GazpromNeft NIS, 3rdQ Net profit of 278 MEUR, the report

14. November 2013. / News Serbia Energy

The implementation scope of the investment program of the GazpromNeft Oil Industry of Serbia in the first nine months totaled 332 MEUR, which is better than the same indicator last year by 25%. Most of the capital investment, 138 MEUR, was focused on projects in the field of exploration and hydrocarbons production.

The priorities of the investment program in this direction are the renewal of geological exploration works in order to increase reserves over production volume, foreign concessions, the introduction of new technological solutions, automation of production processes and infrastructure development.

In the processing development, according the results for nine months in 2013th, the company has invested 78 MEUR. Key projects in this area were the implementation of programs to increase operating efficiency in Refinery Pancevo, project development of building center for the base oil production in Refinery Novi Sad, increasing environmental safety of the processing complex and service facilities.

For the project of modernization and expansion of the transport network in Serbia and in Bosnia and Herzegovina, Bulgaria and Romania, the company has earmarked 97 MEUR.

Net profit of NIS companies group (NIS, and daughter-companies and subsidiaries) according the results for the nine months in 2013th amounted to 278 MEUR, which corresponds to this indicator from last year.

Preservation of the financial results of the company business is,  despite the worsening of macroeconomic conditions and increase of the tax burden, the result of efficiency increase in production processes, especially in the processing sector due to releasing the hydrocracking / hydro treating complex in Refinery Pancevo, sales increase of high margin products, including the client programs development in the retail and wholesale field, as well as increasing the goods quality and services in the company’s gas stations.

Operating income before interest payments, income taxes and amortization (EBITDA) amounted to 418 MEUR, which is also at the same indicator level as in the last year.

Thanks to the discipline improvement in claims payments, according the results for the nine months in 2013, the company’s operating cash flow was increased by 78% compared with the same indicator last year, reaching 435 MEUR.

NIS continued strengthening of key production indicators. The sales volume of oil products on the Serbian and regional market amounted to 2,183 million tons, which is better than last year’s indicator by 28%. Key drivers of growth in sales volume were increase of retail and wholesale white products, increase in shipments export, as well as the development of marketing tools for sales management.

Thanks to the sales system development, the company succeeded in the volume increase of crude oil and intermediate on 2,204 million tons, which is for 45% more compared to the nine months of 2012th.

NIS Oil and gas production based on the results of nine months of this year amounts to 1,227 million tons of oil equivalent, which is better than last year’s indicator by 3%. The growth in production was made ​​possible thanks to the commissioning of new wells at the company sites, as well as the implementation of additional geological and technical measures.

The total volume of bank credit obligations of NIS per state on 30.09.2013. amounted to 471 million dollars.

Commenting on the NIS business results after nine months in 2013, general director Kiril Kravchenko said:

“Despite negative macroeconomic conditions, according the results for nine months in 2013, NIS preserved its contribution to the support of lines that are important for the Serbia stable development. It is the realization of projects in the field of environment, support to the social sphere and the personnel potential development. Our contribution to the local economy grows – the extent of our tax benefits for three quarters in 2013th is almost two times higher than the same indicator in 2009. In the part of the business development a key priority remains renewal of technological base and innovations introduction. This policy has already achieved results – we increase production indicators, creating a stable resource base for the future. We distantly evaluate macroeconomic perspective until the end of the year. However, we hope that we will be able to accomplish the tasks that shareholders were set in front of NIS. As a company that works primarily for our customers, we are grateful for the trust you have placed in us by our customers, and hope to continue their support.”

Source; Serbia Energy

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