Page 56 - UKRRptSept18

9.2 Major corporate news 9.2.1 Oil & gas corporate news
Ukraine’s leading producer of crude oil Ukrnafta reported a 22% y/y increase in net revenue to UAH16.76bn in the first half of 2018 and profits were up while its debt to the state was down in the period according to its July 30 regulatory filing. The key growth factor was higher revenue from crude oil sales (up 45% y/y to UAH9.40bn) amid an 8% increase in oil sales in volume terms (to 713 kt), which implies a 34% y/y increase in the average oil price, Concorde Capital said in a note. Better pricing of oil enabled the company to generate 54% higher EBITDA in the first half of 2018 (UAH3.80bn) and resulted in the same 54% y/y increase in its bottom line (to UAH2.06bn) in the first half of 2018. “Remarkably, the company managed to reduce its tax payables to UAH12.15bn as of end-June 2018, which is 4% less YTD and 7% less q/q. The company’s end-June cash balance was UAH0.24bn (37% less YTD),” Alexander Paraschiy of Concorde Capital said in a note. “Despite preferable market conditions and excessively good P&L, the company’s balance sheet continues to disappoint. Namely, most of generated EBITDA in the first half of 2018 came to increase Ukrnafta’s inventories (by UAH3.08bn YTD to UAH8.28bn in the first half of 2018) and only a tiny amount of that (UAH0.53bn) was used to slightly reduce the company’s debt to the state budget,” the analyst added. “Higher accumulated inventories might be considered an opportunity to partially resolve the outstanding debt issue as soon as the company de-stocks. However, in the case of Ukrnafta it’s more of a risk. So far, the nature of inventories increase is not clear, as well as there is no information on how liquid the inventories are. We remain skeptical about Ukrnafta’s ability to remain a going concern,” Paraschiy said.
Ukraine’s independent oil producer JKX Oil&Gas Plc is back in the black
earning $1.9mn of net profit in January-June 2018, improving on last year’s net loss of $7.7mn, the company reported on the London Stock Exchange (LSE) website, where it is listed. Revenue over the period grew by 15.2%, to $42.2mn, the company reported as cited by Interfax. The gas segment brought $30mn to the company, oil business - $9.2mn and LPG - $2.6mn. Revenue of Ukrainian assets in the first half of 2018 grew by 14.9%, to $33.2mn. The company also has assets in Russia which brought in revenues of $9.1mn, up 15.2% y/y over the same period. The company’s Hungarian assets, which JKX decided to sell, brought $0.8mn over the period.
9.2.2 Automotive corporate news
Ukrainian carmaker Bogdan Motors Automobile Company is back in the black after it earned UAH191.19mn ($7.1mn) of consolidated net profit in January-June 2018, improving on a net loss of UAH1.704bn last year, the company reported on August 1. The carmaker unites the industrial assets of the Bogdan Corporation and reported consolidated net revenues up by 22.4%, to UAH204.53mn. The company saw UAH42.14mn in gross profit in the first half of this year up 83% on the same period a year earlier, and UAH270.28mn of operating profit (UAH257.03mn of loss). The company's liabilities as of July 1, 2018 totalled UAH7.069bn, including bank loans of UAH4.031bn. PJSC Bogdan Motors Automobile Company unites the production assets of Bogdan Corporation, one of the leading Ukrainian automakers (a bus and trolleybus
56 UKRAINE Country Report September 2018 www.intellinews.com