Galp Energia

Earnings Release • Oct 24, 2022

3Q22 RESULTS

October 24, 2022

Disclaimer

This document may include forward-looking statements, including, without limitation, regarding future results, namely cash flows, dividends, and shareholder returns; liquidity; capital and operating expenditures; performance levels, operational or environmental goals, targets or commitments and project plans, timing, and outcomes; production rates; developments of Galp's markets; and impacts of the COVID-19 pandemic on Galp's businesses and results; any of which may significantly differ depending on a number of factors, including supply and demand for oil, gas, petroleum products, power and other market factors affecting them; the outcome of government policies and actions, including actions taken to address COVID-19 and to maintain the functioning of national and international economies and markets; the impacts of the COVID-19 pandemic on people and economies; the impact of Galp's actions to protect the health and safety of its employees, customers, suppliers and communities; actions of Galp's competitors and commercial counterparties; the ability to access short- and long-term debt markets on a timely and affordable basis; the actions of consumers; other legal and political factors, including changes in law and regulations and obtaining necessary permits; unexpected operating events or technical difficulties; the outcome of commercial negotiations, including negotiations with governments and private entities; and other factors discussed in Galp's Management Report & Accounts filed with the Portuguese Securities Market Commission (CMVM) for the year ended December 31, 2021 and available on our website at galp.com. This document may also contain statements regarding the perspectives, objectives, and goals of Galp, namely concerning ESG (Environmental, Social & Governance) objectives, including with respect to energy transition, carbon intensity reduction or carbon neutrality. An ambition expresses an outcome desired or intended by Galp, it being specified that the means to be deployed may not depend solely on Galp. Galp's business plans and budgets include investments that will accelerate the decarbonization of the Company over the next decade. These business plans and budgets will evolve over time to reflect its progress towards the 2050 Net Zero Emissions target. All statements other than statements of historical facts are, or may be deemed to be, forward-looking statements. Forward-looking statements express future expectations that are based on management's expectations and assumptions as of the date they are disclosed and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such those statements. Accordingly, neither Galp nor any other person can assure that its future results, performance or events will meet those expectations, nor assume any responsibility for the accuracy and completeness of the forward-looking statements. Forward-looking statements include, among other things, statements concerning the potential exposure of Galp to market risks and statements expressing management's expectations, beliefs, estimates, forecasts, projections, and assumptions. These forward-looking statements may generally be identified by the use of the future, gerund or conditional tense or the use of terms and phrases such as "aim", "ambition", "anticipate", "believe", "consider", "could", "develop", "envision", "estimate", "expect", "goals", "intend", "may'', "objectives", "outlook", "plan", "potential", "probably", "project", "pursue", "risks", "schedule", "seek", "should", "target", "think", "will" or the negative of these terms and similar terminology.

Financial information by business segment is reported in accordance with the Galp's management reporting policies and shows internal segment information that is used to manage and measure the Group's performance. In addition to IFRS measures, certain alternative performance measures are presented, such as performance measures adjusted for special items (adjusted operational cash flow, adjusted earnings before interest, taxes, depreciation and amortisation, adjusted earnings before interest and taxes, and adjusted net income), return on equity (ROE), return on average capital employed (ROACE), investment return rate (IRR), equity investment return rate (eIRR), gearing ratio, cash flow from operations and free cash flow. These indicators are meant to facilitate the analysis of the financial performance of Galp and comparison of results and cash flow among periods. In addition, the results are also measured in accordance with the replacement cost method, adjusted for special items. This method is used to assess the performance of each business segment and facilitate the comparability of the segments' performance with those of its competitors. This document also contains non-financial performance indicators, according to applicable legislation, including a carbon intensity indicator for energy products sold by Galp, that measures the amount of greenhouse gas emissions of those products, from their production to their end use, per unit of energy delivered. This indicator covers the direct GHG emissions of production and processing facilities (scope 1) and their indirect emissions associated with energy purchased (scope 2), as well as the emissions associated with the use of products by Galp's costumers (scope 3). The same emissions are considered for products purchased from third parties and sold or transformed by Galp. For a complete definition of scopes 1, 2 and 3 and the methodology used by Galp for this indicator please refer to Galp's website at galp.com. This document may include data and information from sources that are publicly available. This document may also include data and information provided by third parties, including Wood Mackenzie, Rystad and market analysts, which are not publicly available. Such data and information should not be interpreted as advice and you should not rely on it for any purpose. You may not copy or use this data and information except as expressly permitted by those third parties in writing. To the fullest extent permitted by law, those third parties accept no responsibility for your use of such data and information except as specified in a written agreement you may have entered into with those third parties for the provision of such data and information.

Galp and its respective representatives, agents, employees or advisers do not intend to, and expressly disclaim any duty, undertaking or obligation to, make or disseminate any supplement, amendment, update or revision to any of the information, opinions or forward-looking statements contained in this document to reflect any change in events, conditions or circumstances. This document does not constitute investment advice nor forms part of and should not be construed as an offer to sell or issue or the solicitation of an offer to buy or otherwise acquire securities of Galp or any of its subsidiaries or affiliates in any jurisdiction or an inducement to engage in any investment activity in any jurisdiction.

Recent developments

3Q22 overview

01

3Q22 highlights

Executing key strategic projects according to plan

Strong operational performance, mostly supported on international activities

Robust cash flow generation capturing macro environment

Working capital release including reversal from derivatives as expected

Net debt decrease even with Titan acquisition & consolidation and shareholders' distributions

3Q22: Upstream

Robust contribution and higher availability on production units

128kboepd WI Production +7% QoQ

99	56
\$/bbl	\$/boe
Oil	Gas
realisations1	realisations1

Ebitda (€m)

Quarter highlights

Improved production through higher uptime

Improved oil discounts and gas realisations, while maintaining low production costs

Booking of one-off unitisation adjustment of Berbigão/ Sururu2 (always planned for 2022) and lower Ebitda from 3 cargoes in transit3

Outlook

On track to meet FY22 production guidance

Beginning of Bacalhau I drilling programme

Namibia PEL83 targeting exploration well in late 2023

¹ Overall Oil + Gas realisations with \$5.8/boe implicit discount to Brent in 3Q22. 2 Non-cash impact of €138 m on Ebitda and net equalization payable position of c.€40 m (process ongoing and awaiting for ANP approval).

5 3Q22 Results

Coral South FLNG

Placing Mozambique on the LNG map

c.\$7 bn Total investment 100% Galp's stake 10%

3.4 mtpa Over 25 years Capacity of LNG per year

>700 mboe Recoverable volumes

>8 kboepd

WI production Galp share at peak First Floating LNG facility in ultra-deep waters

Delivering large-scale project on time and on budget

Coral LNG 100% offtake to bp

3Q22: Commercial

Ongoing recovery trend although signs of weaker gas and electricity demand

Oil products sales +12% YoY

-5% YoY 5.2 TWh Gas and Power sales

Ebitda (€m)

2.0 mton Quarter highlights

Oil volumes supported by B2B recovery

Gas and electricity sales impacted by B2B activity reduction

Fast growth of decentralised solar, reaching 8 k Solar PV installations

Increasing scale of e-mobility network, now >1.7 k chargers installed

Outlook

Price environment to impact gas and electricity Iberian demand

Continuing to expand decentralised energy, e-mobility and convenience concepts

On track to >€300 m for full year RCA Ebitda in 2022

3Q22: Industrial & Energy Management

Robust refining performance whilst gas trading impacted by sourcing restrictions

7.7 \$/boe Refining margin

calculated with gas costs at Iberian spot prices

23 mboe Raw materials processed c.100 % High conversion utilisation

Ebitda1 (€m)

Quarter highlights

System 1st quartile availability maximising refinery contribution

Continually improving industrial operational and safety performance

LNG sourcing restrictions impacting gas trading given pre-sold volumes

Outlook

Planned maintenance in Q4 but FY22 throughput maintained at c.90 mboe

Monitoring Nigeria LNG force majeure implications

Gas supply & trading in 2023 to benefit from additional flexibility

HVO project feedstock partnership signed and preparing Matosinhos' Future Hub

¹ Includes €-70 m of realised refining hedges impact, reflecting increased spread between realised and benchmark margin (see appendix for additional information). Galp has refining hedges covering c.6 mboe for 4Q22 and c.7 mboe for FY23.

3Q22: Renewables & New Businesses

Continued renewables capacity deployment and preparing future growth

Gross operating capacity

627 GWh 2x YoY

Equity renewable generation

Quarter highlights

100% of Titan consolidated from August onwards

First solar plant in Portugal (Alcoutim) in operation adding 106 MWp

Advancing on the lithium conversion project with key positions hired

Outlook

1.4 GW in operation and preparing to accelerate construction in 2023

Licencing and development permits remain the key bottleneck

Addressing generation mix and hybridization opportunities

Executing our distinctive investment proposition

to thrive through the energy transition

Growth from established businesses

Delivering on Coral start-up and start drilling Bacalhau I project

Transforming the Industrial and Commercial businesses

Growth from low carbon businesses

Doubling equity renewable energy generation YoY

Advancing with renewable fuels and battery value chain projects

Competitive shareholder distribution

€0.26/sh interim dividend paid in September, completing €150 m buyback program with shares cancelation until YE

Expecting c.€0.5 bn in buybacks related to 2022

Financial overview

3Q22 results

02

11 3Q22 Results

€784 ^m 3Q22 Group RCA Ebitda

€484 ^m 3Q22 Group OCF

€558 m 3Q22 Group net capex

3Q22: Solid operational results

across all business units

Upstream

Improved production and oil differentials and gas realisations. QoQ unitisation impact & negative swing from increased cargoes in transit	612 € m RCA Ebitda1	320 € m OCF	205 € m Net capex2
Commercial	103	88	23
Contribution reflecting seasonal demand and gradual recovery	€ m RCA Ebitda	€ m OCF	€ m Net capex2
Industrial & EM
Solid Industrial performance partially offset by gas supply and trading impacts from sourcing restrictions and gas price differentials	48 € m RCA Ebitda3	57 € m OCF	20 € m Net capex2
Renewables Strong results benefiting from Titan stake acquisition and new capacity online	38 € m RCA Ebitda	35 € m OCF	265 € m Net capex2

3Q22: RCA Ebitda of €784 m

Supported by strong operational delivery

RCA Ebitda reflecting solid operational performance but impacted by unitisation agreement and gas sourcing

RCA Ebit including São Tomé and Principe impairment and recognition of Matosinhos transformation projects as recurring

Financial results benefiting from positive mark-to-market swings of €114 m

Taxes including SPT in Brazil booked as per the production in the period and not cargoes sold

3Q22 P&L (€ m)

Strong operational cash generation

Supporting deleverage

3Q22 Cash flow (€ m)

Robust OCF contribution across all business units

Working capital release from lower commodity prices and supported by €306 m roll off in natural gas derivatives margin calls

Strong FCF generation covering shareholder distributions of €290 m1

Net debt reduction of €89 m even considering c.€300 m from Titan acquisition and net debt consolidation

2022 full year outlook

Expected distributions maintained at c.€0.9 bn

4Q22 assumptions

Brent c.\$90/bbl | Refining margin c.\$15/boe | Solar captured price c.€130/MWh | EUR:USD 1.00 Upstream Ebitda unchanged at c.€3 bn, with FY22 WI production guidance maintained

Commercial Ebitda on track towards >€300 m

Industrial & EM Ebitda revised to c.€500 m, limited by gas supply & trading activities

Excludes potential Nigeria LNG force majeure impacts. Estimated €40-50 m impact for missed cargo (assuming Mibgas at c.€70/MWh)

Renewables & New Businesses Ebitda of c.€60 m (considering Titan consolidation from August onwards)

Net capex revised upwards considering the USD:EUR appreciation and renewables at 100%

Expected distributions related to 2022 fiscal year

1/3 OCF Total distributions (Base dividend + Buybacks)

Net Debt to Ebitda YE22 well below 1x

€0.52/sh Base dividend (+4% YoY)

+

c.€0.5 bn Buybacks (based on c.€2.8 bn OCF)

03

galp.com

Key guidance for 2022

Operational indicators (no changes)

Upstream
WI production	kboepd	Flat YoY
Upstream production costs	\$/boe	<3
Commercial
Oil products sales to direct clients	mton	c.7.0
EV charging points	-	2k
Industrial & Energy Management
Sines refining throughput	mboe	c.90
Sines refining cash costs	\$/boe	c.2.0
Renewables
Renewable generation capacity by YE (@100%)	GW	1.4
Renewable generation (@100%)	TWh	2

Financial indicators

RCA Ebitda	€ bn	c.3.8
Upstream	€ bn	c.3.0
Commercial	€ m	>300
Industrial & Energy Management	€ m	c.500
Renewables	€ m	c.60
OCF	€ bn	c.2.8
Upstream	€ bn	c.1.9
Commercial	€ m	c.230
Industrial & Energy Management	€ m	c.500
Renewables	€ m	c.50
Net capex	€ bn	1.1-1.2
Net debt to RCA Ebitda by YE	-	<1

Galp's refining margin vs hedging indicator

Refining Margins (\$/boe)

High historical adherence between Galp refining margin and hedging indicator

From March 2022 onwards the gap widened as a result of high market volatility (raw materials differentials, product cracks, energy costs)

Galp has refining hedges covering 5.6 mboe for 4Q22 and c.7 mboe for FY23

galp.com