Rompetrol Rafinare, a member company of KMG International, also continued to increase its operational results in the first half of this year based on the strategic investments made in recent years. Thus, the total volume of raw materials processed at the Petromidia refinery level exceeded in January-June the threshold of 3.1 million tonnes.
Regardless of the operational activity, the financial results of Rompetrol Rafinare were significantly influenced by the evolution of external factors. The volatility of the global context, the high fluctuations of the market quotations on raw materials and finished products, the significant pressure on the refining margins and the depreciation of local currencies against the dollar (the reference currency for oil and petroleum products) have led to declining results.
|
Consolidated indicators* |
Q2 2019 |
Q2 2018 |
% |
S1 2019 |
S1 2018 |
% |
|
|
Gross turnover |
USD |
1,363,132,989 |
1,397,926,705 |
-2% |
2,501,387,792 |
2,604,142,235 |
-4% |
|
EBITDA |
USD |
37,766,243 |
51,279,759 |
-26% |
54,929,775 |
85,880,579 |
-36% |
|
Net result |
USD |
(5,392,606) |
6,557,797 |
N/A |
(19,438,112) |
2,778,742 |
N/A |
* Note: The consolidated financial statements of Rompetrol Rafinare include the results of Rompetrol Rafinare S.A. and those of the subsidiaries Rompetrol Quality Control S.R.L., Rom Oil S.A., Rompetrol Downstream S.R.L., Rompetrol Logistics S.R.L. Rompetrol Gas S.R.L and Rompetrol Petrochemicals S.R.L.
According to the evolution of quotations on oil and petroleum products, the gross turnover recorded by Rompetrol Rafinare registered a reduction of about 4% to a total level of over USD 2.5 billion in S1 2019, compared to USD 2.6 billion in S1 2018. The company recorded an EBITDA of nearly USD 55 million in S1, down 36% compared to S1 of 2018, and the net result was negative, of approximately USD 19 million.
“We remain faithful to our strategy of integrated development of the company on all segments: refining, petrochemicals and distribution. This year we aim for investments of about USD 60 million for the alignment and further modernization of the facilities, as well as for the digitization of the Petromidia refinery. Thus, we will continue to optimize and improve our operations, and the Petromidia and Vega refineries will become efficiency models for the entire industry in Romania,” says Yedil Utekov, General Director of Rompetrol Rafinare.
The Petromidia refinery has maintained the trend of implementing programs to optimize production processes and streamline operating costs, programs started in 2014 and which continue to date. Moreover, in the last period the digital component has been successfully integrated by the implementation of projects that support a continuous automation of technological processes, in line with the global industrial revolution - Industry 4.0.
Due to the expansion of the segment of distribution of fuels internally, but also of the demand for petroleum products, the company increased its deliveries in Romania in the first half of the year by 10% - its main market. At the same time, the refining and petrochemical divisions managed to export nearly 1.4 million tonnes of petroleum products, slightly lower than the volume exported in the same period last year.
Rompetrol Rafinare continued to be an important contributor to the Romanian state budget in the first semester of 2019, the activities and products obtained generating a contribution of over USD 728 million. In 2018, the company transferred about USD 1.5 billion to the state budget.
The main shareholders of Rompetrol Rafinare SA are KMG International (54.63% - directly and indirectly) and the Romanian State through the Ministry of Energy (44.69%).
The refining segment *
|
Q2 2019 |
Q2 2018 |
% |
S1 2019 |
S1 2018 |
% |
||
|
Gross turnover |
USD |
1,158,250,988 |
1,199,617,246 |
-3% |
2,154,650,412 |
2,247,929,317 |
-4% |
|
EBITDA |
USD |
28,741,501 |
47,203,350 |
-39% |
37,808,454 |
76,739,772 |
-51% |
|
Net result |
USD |
(6,299,129) |
19,932,084 |
N/A |
(9,156,253) |
17,471,003 |
N/A |
|
Operational |
|||||||
|
Raw materials processed - Petromidia |
Kt |
1,611 |
1,560 |
3% |
3,126 |
3,087 |
1% |
|
Raw materials processed - Vega |
Kt |
123 |
117 |
5% |
202 |
194 |
4% |
|
Petrol production |
Kt |
407 |
410 |
-1% |
804 |
856 |
-6% |
|
Diesel & jet production |
Kt |
852 |
808 |
5% |
1,632 |
1,562 |
4% |
|
Internal fuel sales |
Kt |
655 |
630 |
4% |
1,195 |
1,084 |
10% |
|
Fuel sales - export |
Kt |
549 |
503 |
9% |
1,123 |
1,210 |
-7% |
*The refining activity includes the results of the company Rompetrol Rafinare regarding the Petromidia and Vega refineries. Rompetrol Rafinare calculates the gross refining margin as follows - (Sales of petroleum products - Cost of raw materials)/Sales volume. The net refining margin is the operating profit (EBITDA) divided by sales volume.
In the refining segment, the company achieved a gross turnover of USD 2.15 billion in the first half of the year, decreasing by about 4% compared to the same period of 2018. The change from last year was determined by the decrease of international quotations on the oil and gas market, on oil products.
At the same time, the operating profit was halved in S1 2019 to almost USD 38 million as a result of the falling of the gross refining margin by more than 38% - from 49.6 USD/t in the first half of 2018 to 35.8 USD/t during the similar period this year.
During the period January - June, the Petromidia refinery recorded an improvement of the operational results, among which are the raw materials processed - 3.1 million tonnes, the yield of the white products obtained - 86.2%, the mechanical availability - 97.5%, technological loss - 0.84% and energy intensity index - 97.4%, close to last year's value. Also, a historical record was reached regarding the production of aviation fuel (Jet A1), as a result of optimizations, improved recipe and minimization of jet level in diesel mixtures.
All these performances were also supported by the implementation of projects that allowed an increase of the automation and control of the operational flows. In this regard, an example is the continuation of the implementation of the Advanced Process Control program - a complex software for predicting the control of the installations and of the operational flows, which aims to identify the optimal points for the increase of capacities, the improvement of the quality of the products, the reduction of the energy consumption and a tighter control of the key parameters.
In the first half of this year, fuel sales registered significant increases domestically, from 1.08 million tonnes in S1 of 2018 to 1.19 million tonnes in the same period this year. During the same period, the Petromidia refinery obtained about 2.43 million tonnes of fuel, of which over 67% were diesel fuels and the special one for aviation - A1 jet.
The Vega Ploieşti refinery - the only producer of bitumen and hexane in Romania, increased by 4% the volume of processed raw materials (202 kt), and the 47 kt of hexane produced exceeded the record of the first half of last year by 3 kt.
The high demand from the domestic market resulted in an increase of 8 kt in S1 2019 for bitumen, reaching a total production of 44 kt. The massive investments made in this segment and the fact that Vega is the only producer at national level add value on an important niche, which is under development.
The Ploieşti refinery is in perfect synergy with the Petromidia Năvodari refinery - the largest in Romania and one of the most modern in the Black Sea region. Thus, Petromidia fully supplies to the Ploieşti refinery the raw/semi-manufactured materials necessary to obtain special products with a high added value.
The petrochemical segment *
|
Q2 2019 |
Q2 2018 |
% |
S1 2019 |
S1 2018 |
% |
||
|
Gross turnover |
USD |
37,551,936 |
53,159,496 |
-29% |
90,650,355 |
114,352,408 |
-21% |
|
EBITDA |
USD |
(3,527,609) |
(5,102,399) |
-31% |
(10,093,285) |
(8,831,546) |
14% |
|
Net profit/(loss) |
USD |
(6,080,704) |
(13,698,496) |
-56% |
(19,545,226) |
(19,090,277) |
2% |
|
Operational |
|||||||
|
Processed propylene |
kt |
38 |
38 |
-1% |
76 |
78 |
-2% |
|
Processed ethylene |
kt |
9 |
15 |
-39% |
17 |
35 |
-51% |
|
Total sales |
kt |
39 |
50 |
-22% |
95 |
108 |
-12% |
*The petrochemical segment comprises the petrochemical activity of Rompetrol Rafinare and the activity of Rompetrol Petrochemicals SRL.
The results of the petrochemical division continued to be influenced by market pressure on margins, which reached in S1 2019 the lowest level in the last decade of 2019 – 456 USD/t on polypropylene (PP), 202 USD/t on high pressure polyethylene (HDPE) and 197 USD/t on low pressure polyethylene (LDPE).
In order to protect and adjust the results/production according to the regional and international context, the company has decided to reduce the flow of polyethylene facilities and imports of raw materials for them (ethylene). Thus, in S1 2019, the volume of processed propylene decreased to 76 kt, while the total quantity of processed ethylene was 17 kt.
The petrochemical segment is the only producer of polypropylene and polyethylene in Romania. The dynamic development strategy has ensured the company a competitive position on the internal market, as well as on the regional markets (the Black Sea and Mediterranean area, Central and Eastern Europe), and the objective is to maintain this advantage, with prospects indicating a market stabilization.
The distribution segment *
|
Q2 2019 |
Q2 2018 |
% |
S1 2019 |
S1 2018 |
% |
||
|
Gross turnover |
USD |
767,160,717 |
853,389,364 |
-10% |
1,421,921,925 |
1,455,553,276 |
-2% |
|
EBITDA |
USD |
11,479,595 |
8,794,779 |
31% |
26,892,486 |
19,130,209 |
41% |
|
Net profit/(loss) |
USD |
6,019,997 |
1,473,808 |
308% |
11,297,898 |
5,429,044 |
108% |
|
Operational |
|||||||
|
Retail sale fuels |
Kt |
192 |
179 |
7% |
355 |
329 |
8% |
|
Wholesale fuels |
Kt |
319 |
368 |
-13% |
594 |
598 |
-1% |
|
LPG quantities sold |
Kt |
99 |
119 |
-17% |
209 |
226 |
-8% |
* The distribution segment includes the results of the subsidiaries Rompetrol Downstream, Rom Oil, Rompetrol Quality Control, Rompetrol Logistics and Rompetrol Gas
The gross turnover of the distribution segment decreased slightly, from USD 1.45 billion in S1 2018, to USD 1.42 billion in the first half of 2019. On the other hand, the operating profit (EBITDA) increased by 41 percent to nearly USD 27 million, and the net result reached approximately USD 11 million, as a result of excise duties increased by over 3% in 2019.
The total volume of fuels sold in the retail segment increased from 329 kt in the first part of 2018, to 355 kt in the same period of the current year, the evolution being supported by the impact of the rebranding program of the Rompetrol stations, the continuation of the optimization and the programs of reduction of operational costs, but also of opening new stations throughout the country.
The distribution segment of Rompetrol Downstream comprised at the end of June 933 sale points, including the network of own stations, partner stations and mobile stations (express, internal bases of 9 and 20 cubic meters).
Department of Communication and Public Relations
KMG International