OMV Petrom posts EUR 106 mln profit in the third quarter as sales continue to decline

OMV Petrom, the biggest oil & gas company in Romania recorded sales of close or EUR 1 billion in the third quarter, 7% lower compared to the same period of 2015. The net profit stood at EUR 106 million, compared to a EUR 10 million loss in Q3 2015. However, last year’s loss was mainly due to impairment on assets and not with the company’s operations. Thus, the clean net income, excluding one-offs was actually almost 50% lower in the third quarter of 2016 than in Q3 2015, the company’s data shows. The company also reduced its capital expenditure (CAPEX) by almost 50% in the third quarter, to EUR 107 million, as the market conditions remained unfavorable. “In the context of weak oil and gas prices and significantly reduced refining margins versus previous year, OMV Petrom’s efforts focused on operational resilience and delivered good results. In Q3 2016, we continued with CAPEX prioritization and strict cost discipline, which translated into a RON 1.1 bln free cash flow. Our constant focus on the most profitable barrels led us to revisit the CAPEX guidance for 2016, from EUR 0.7 bln to EUR 0.6 bln (-30% yoy),” OMV Petrom CEO Mariana Gheorghe said in a statement to investors. In the first nine months of this year, OMV Petrom posted a net profit of almost EUR 200 million, down by 11% compared to the result in the same period of 2015. Excluding one-offs, the net profit was almost 50% lower. The group’s sales declined by 14%, to EUR 2.6 billion. OMV Petrom is controlled by Austrian group OMV, which owns a 51% stake in the company. The Romanian state holds 20.6% and Romanian investment fund Fondul Proprietatea holds another 12.6% stake. Fondul Proprietatea recently sold 6.4% of OMV Petrom’s shares via a public offering on the Bucharest Stock Exchange and London Stock Exchange, which also marked the company’s listing on LSE. OMV Petrom has a market capitalization of EUR 2.86 billion after its shares have dropped 30% in the last 12 months. OMV Petrom sells 19 oil fields in Romania to Dutch company editor@romania-insider.com