Page 53 - UKRRptAug18

9.2 Major corporate news 9.2.1 Oil & gas corporate news
Discussion on EU gas directive postponed. The Committee of Permanent Representatives of the European Union decided to postpone the discussion on amending the gas directive following the negotiations between Russia, Ukraine and the EU on the gas transit contract via Ukraine, according to Vedomosti, citing 2 sources with knowledge of the situation. The gas directive implies that the supplier and transporter of gas must be different entities and demands that third parties have access to pipelines. In November 2017, the European Commission proposed changes that would apply these rules to pipelines coming from outside the European Union, such as Nord Stream 2.
Ukrnafta saw net profit rise by 54.3% in January-June 2018 compared to the same period in 2017, to UAH2.061bn. According to a company report in the information disclosure system of the National Commission on Securities and the Stock Market, its net income grew by 21.6%, to UAH16.762bn, gross profit by 40.8%, to UAH9.675bn. In January-June 2018 Ukrnafta sold 712,800 tonnes of oil with gas condensate for UAH9.398bn, 117.8mn cubic meters of natural gas for UAH889.635mn, 174,200 tonnes of fertilizers and nitrogen compounds for UAH831.937mn, 53,000 tonnes of liquefied gas for UAH639.321mn. Ukrnafta has not indicated data on the sales of petroleum products for the first half of the year. Naftogaz Ukrainy owns a 50% plus one share stake of Ukrnafta, the former shareholders of PrivatBank (Kyiv) hold about 42% of the shares. Tags: #ukrnafta
Cayman Islands-registered Cascade Investment Fund, controlled by controversial Ukrainian lawmaker Vitaly Khomutynnik, will control a 19.92% stake in UK-based JKX Oil & Gas company , which has assets in Ukraine and Russia. Russia's Proxima Capital Group has reduced its stake in JKX from 19.97% to 9.97% of ordinary shares, the company said in a statement published via the London Stock Exchange. Cascade Investment Fund obtained 19.92% of JKX's charter capital on July 12. Cascade Investment is now the direct owner of 10.04% of JKX ordinary shares and a further 9.88% through financial instruments which can be converted into shares from July 30, according to Interfax news agency. Khomutynnik is a leader of parliamentary group Vidrodzhennia (Revival), which includes local elites and former politicians from ousted ex-president Viktor Yanukovych’s notorious Party of Regions, according to Volodymyr Fesenko, head of the Kyiv-based think tank Penta Political Centre.
JKX Oil & Gas net revenue rose 15% y/y to $42.39mn in the first half of 2018 , according to its July 30 interim report. Equal revenue growth of 15% y/y occurred in both its key markets, Ukraine and Russia, to $33.21mn and $9.13mn, respectively. Its operating profit improved to $4.38mn in the first half of 2018 (from negative $5.43mn a year before), with its Ukrainian assets (generating $4.83mn in profit) being traditionally the biggest contributor to the result. JKX’s operating profit adjusted for exceptional items reached $7.36mn (up from negative $1.76mn in 1H17). The company’s EBITDA (adjusted for exceptional items) jumped 65% y/y to $14.48mn and operating cash flow before working capital changes swelled 62% y/y to $16.68mn. Its net cash generated from operations surged 8x y/y to $12.56mn, while cash use to CapEx decreased by 37% y/y to $6.49mn. That enabled JKX to improve its
53 UKRAINE Country Report August 2018 www.intellinews.com