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In the first half of 2016, LOTOS posted PLN 1,211m in operating profit before depreciation and amortisation (EBITDA). Operating profit (EBIT) was PLN 688m, with net profit of PLN 332m. The average capacity utilisation rate at the refinery in Gdańsk was 96% (against 99% in the second quarter of 2016).

Finance

In the first half of 2016, LOTOS posted PLN 1,211m in operating profit before depreciation and amortisation (EBITDA). Operating profit (EBIT) was PLN 688m, with net profit of PLN 332m. The average capacity utilisation rate at the refinery in Gdańsk was 96% (against 99% in the second quarter of 2016).

In the first half of 2016, LOTOS’s operating cash flows were PLN 950m (up 82% yoy), which is proof of the Company’s strong ability to generate cash from its core activities. Net debt fell by PLN 335m, to PLN 5,366m.

Record-high production − 5m barrels in six months

The average daily production volume achieved by LOTOS companies in Norway, Poland and Lithuania in the period under review was 29 thousand barrels of oil equivalent (boe) (up 106% yoy). In the first half of 2016, LOTOS produced nearly 5m boe (+135% yoy), the highest half-yearly output ever recorded by the Company.

Revenue in the upstream segment was PLN 611m (up 61% yoy), which resulted from higher production of gas, condensate and crude oil from the Sleipner field (the Norwegian Continental Shelf) and from the B8 field (the Baltic Sea). In the first half of 2016, operating profit (EBIT) was PLN -16.8m, due mainly to one-off items (impairment losses on individual licences). Adjusted EBIT of the upstream segment amounted to PLN 71.4m (up 56% yoy), and adjusted operating profit before depreciation and amortisation (EBITDA) was PLN 352m (up 98% yoy).

Higher EBIT despite lower margin

As at the end of June 2016, the LOTOS retail chain comprised 478 stations, 29 more than the year before. This number included 198 LOTOS Optima stations (23 more than in the first half of 2015).

Despite low fuel margins, the retail segment, supported by optimisation efforts, reported operating profit of PLN 18.2m in the first half of 2016 (up 10.3% yoy).

EFRA Project − already through its first year

In the second quarter of 2016, further engineering, procurement, and construction management contracts for inter-unit connections and auxiliary facilities were signed under the EFRA Project.

In May 2016, a building permit was received for the Hydrowax Vacuum Distillation Unit (HVDU). Work on engineering design and procurement of equipment for the key units: Delayed Coking/Coker Naphtha Hydrotreating Units (DCU/CNHT), Hydrogen Generation Unit (HGU) and Hydrowax Vacuum Distillation Unit (HVDU) was at an advanced stage.

Road works, as well as the construction of an electrical substation and a new pipeline flyover, continued. Piling work began at the site where the tank farm for DCU’s intermediate products is to be built. As at the end of June 2016, the stage of completion of the EFRA Project was 23%, above the planned 20.5%.

Communications Office, Grupa LOTOS S.A., ul. Elbląska 135, 80-718 Gdańsk, Poland, tel. (+48) 58 308 87 31, (+48) 58 308 83 88, e-mail: media@grupalotos.pl 

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