NOVATEK

Earnings Release • Feb 26, 2016

National Storage Mechanism | Additional information

You don't have Javascript enabled. For full functionality this page requires javascript to be enabled.

RNS Number : 2397Q

OAO Novatek

26 February 2016

FOR IMMEDIATE RELEASE

NOVATEK announces consolidated IFRS results

for the year ended 31 December 2015

Moscow, 26 February 2016. OAO NOVATEK today released its audited consolidated financial statements for the year ended 31 December 2015 prepared in accordance with the International Financial Reporting Standards ("IFRS"). 

IFRS Financial Highlights

(in millions of Russian roubles)

	FY 2015	FY 2014
Oil and gas sales	472,007	355,673
Other revenues	3,318	1,970
Total revenues	475,325	357,643
Operating expenses	(335,042)	(236,512)
Net gain on disposal of interests in joint ventures	989	2,623
Other operating income (loss)	(542)	4,009
Profit from operations*	139,741	125,140
Normalized EBITDA of subsidiaries*	160,800	140,371
Normalized EBITDA including share in EBITDA of joint ventures*	214,466	159,631
Finance expense	(16,182)	(46,745)
Share of loss of joint ventures, net of income tax	(31,607)	(28,175)
Profit before income tax	92,941	52,843
Profit attributable to shareholders of OAO NOVATEK	74,396	37,296
Adjusted profit** attributable to shareholders of OAO NOVATEK	135,049	104,789
Adjusted basic and diluted earnings per share** (in Russian roubles)	44.71	34.67

* Excluding net gain on disposal of interests in joint ventures.

** Excluding net gain on disposal of interests in joint ventures, as well as foreign exchange gain (loss) and change in fair value of non-commodity financial instruments (including at the joint ventures level)

For the twelve months ended 31 December 2015, total revenues increased  by 32.9% year-on-year to RR 475.3 billion largely due to a record increase in liquids sales volumes, growth in natural gas sales prices, as well as an increase in liquids net sales prices in rouble terms driven by higher US dollar to Russian rouble exchange rate and lower export duty rates.

In 2015, we recorded a year-on-year increase of 34.4% in the Company's Normalized EBITDA, including our respective share in the EBITDA of joint ventures, which totaled RR 214.5 billion. The growth in our Normalized EBITDA was positively impacted by a higher share of liquid hydrocarbons in our overall sales volumes mix, as well as an increase in sales volumes of high value-added petroleum products from the Ust-Luga Complex.

Profit attributable to NOVATEK shareholders increased twofold to RR 74.4 billion, as compared to RR 37.3 billion in 2014. The amount of profit and its dynamics were significantly impacted by the foreign exchange effect and the change in fair value of non-commodity financial instruments (including at the joint ventures level), as well as the effect of disposal of interests in joint ventures. Net of these effects, our adjusted profit attributable to NOVATEK shareholders in 2015 and 2014 totaled RR 135.0 billion and RR 104.8 billion respectively, representing a year-on-year increase of 28.9%.

Our free cash flow increased by 67.2% to RR 82.3 billion as a result of operating cash flow growth by 19.4% and a decrease in cash used for capital expenditures by 18.5% as compared to 2014.

Production and Purchased Volumes

	FY 2015	FY 2014
Natural gas production including proportionate share in the production of joint ventures, million cubic meters (mmcm)	67,905	62,129
including natural gas production by subsidiaries, mmcm	49,172	52,598
Natural gas purchases from joint ventures, mmcm	7,152	5,402
Other purchases of natural gas, mmcm	6,626	7,165
Total natural gas production by subsidiaries and purchases, mmcm	62,950	65,165
Liquids production including proportionate share in the production of joint ventures, thousand tons (mt)	9,094	6,036
including liquids production by subsidiaries, mt	4,198	4,340
Liquids purchases from joint ventures, mt	9,045	3,180
Other purchases of liquids, mt	94	49
Total liquids production by subsidiaries and purchases, mt	13,337	7,569

Hydrocarbon Sales Volumes

	FY 2015	FY 2014
Natural gas, mmcm	62,465	67,231
including sales to end-users, mmcm	58,054	63,281
Liquids, mt	12,888	7,089
including:
Gas condensate refined products	6,693	4,438
Stable gas condensate	2,786	303
Liquefied petroleum gas	2,306	1,434
Crude oil	1,090	903
Other oil products	13	11

In 2015, our natural gas sales volumes totaled 62.5 bcm as compared to 67.2 bcm in 2014. Lower natural gas sales volumes were mainly a result of warmer weather conditions in 2015 compared to 2014, as well as one of our major customers not taking temporarily its full contracted volumes due to technical reasons. As at 31 December 2015, the total amount of natural gas recorded as inventory aggregated 1.3 bcm.

Our liquid hydrocarbon sales volumes amounted to a record high of 12.9 million tons, representing an 81.8% increase as compared to 2014.  The significant increase was due to production growth at the Arcticgas fields, the launch of the Termokarstovoye field and an increase of crude oil production by subsidiaries. As at 31 December 2015, 910 thousand tons of liquid hydrocarbons were in transit or storage and recognized as inventory.

Selected Balance Sheet Items

(in millions of Russian roubles)

	31 December 2015	31 December 2014
ASSETS
Non-current assets	751,552	572,548
Property, plant and equipment	331,712	291,726
Investments in joint ventures	154,725	166,231
Long-term loans and receivables	230,799	94,142
Total current assets	120,485	126,591
Assets held for sale	7,987	-
Total assets	880,024	699,139
LIABILITIES AND EQUITY
Non-current liabilities	282,178	230,807
Long-term debt	252,050	204,699
Current liabilities	169,675	81,208
Total liabilities	451,853	312,015
Equity attributable to OAO NOVATEK shareholders	426,079	384,755
Non-controlling interest	2,092	2,369
Total equity	428,171	387,124
Total liabilities and equity	880,024	699,139

The full set of audited consolidated IFRS financial statements for the year ended

31 December 2015 and the related notes thereto as well as Management's Discussion and Analysis of Financial Condition and Results of Operations are available on the Company's website (www.novatek.ru).

***

For further information, please visit www.novatek.ru or contact:

Press Service +7 (495) 721 2207 press@novatek.ru	Investor Relations +7 (495) 730 6013 IR@novatek.ru

***

OAO NOVATEK is Russia's largest independent gas producer and the second-largest natural gas producer in Russia. Founded in 1994, the Company is engaged in the exploration, production, processing and marketing of natural gas and liquid hydrocarbons. The Company's upstream activities are concentrated in the prolific Yamal-Nenets Autonomous Region, which is the world's largest natural gas producing area and accounts for approximately 80% of Russia's gas production and approximately 16% of the world's gas production. NOVATEK is an open joint stock company established under the laws of the Russian Federation. The Company's shares are listed in Russia on Moscow Exchange (MOEX) and the London Stock Exchange (LSE) under the ticker symbol «NVTK».

This information is provided by RNS

The company news service from the London Stock Exchange

END

FR LIFFRFVIRFIR