Page 11 - FSU OGM Week 22 2021
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FSUOGM PERFORMANCE FSUOGM
Lukoil posts strong numbers in Q1
RUSSIA RUSSIA’S Lukoil swung to a net profit of capital expenditure, bodies well for the interim
RUB157bn ($2.14bn) in the first quarter, ver- dividend.”
The company benefitted sus a RUB46bn loss a year earlier, on the back Lukoil also benefited from the absence of
from higher oil prices, of higher oil prices, increased gas supply and a major impairment charges during the three-
increased gas supply recovery in fuel demand. Significant devaluation month period. Like other Russian majors, Lukoil
and rising fuel demand. of the Russian ruble since the pandemic began booked hefty write-down charges this time last
was also a major factor. year to reflect the impact of lower oil prices on
Revenues at the country’s second-biggest oil the value of its assets.
producer rose by 13% year on year to RUB1.9 “Lukoil performed strongly in the upstream,
trillion and EBITDA more than doubled to turning in no major surprises on costs or taxes,
RUB314.4bn. Earnings were supported by a while realised prices rose more than oil bench-
5.5% growth in gas production, thanks to a marks,” analysts at Sberbank CIB said, noting
rebound in supply in Uzbekistan. Lukoil slashed that the result was achieved despite the compa-
output at its Uzbek fields significantly last year ny’s loss of tax benefits for depleted and high-vis-
after the coronavirus (COVID-19) took its toll cosity fields.
on gas demand in China, where their gas is sold. “Based on disclosed data, we estimate that
This increase, coupled with higher oil prices Lukoil has already shifted 75% of its depleted
and a post-COVID-19 rally in fuel demand in reserves to the excess profit tax regime,” Sber-
Russia, more than offset a 11.6% slide in liquids bank CIB said. “Meanwhile, last-quarter refin-
output to 1.58mn barrels per day (bpd) as a result ing profitability improved slightly more than
of OPEC+ cuts. Lukoil’s upstream EBITDA grew expected; however, a major additional contri-
to RUB224bn from RUB109bn a year ago, while bution came from selling about 0.7mn tonnes of
earnings from refining, marketing and distri- crude oil from inventories.”
bution almost tripled to RUB120.2bn from VTB Capital (VTBC) meanwhile pointed to
RUB40.3bn. improved cost control, noting that general and
“Lukoil’s Q1 2021 IFRS numbers handily administrative expenses came in 7% below its
outperformed at the EBITDA level on a resur- forecast, while transport costs were 11% below
gence in international downstream,” analysts its forecast. Lukoil also paid 8% less in non-in-
at BCS Global Markets commented. “A strong come taxes during the three months than VTBC
free cash flow number, boosted by a fall in had anticipated.
Week 22 02•June•2021 www. NEWSBASE .com P11
