Galp Energia

Investor Presentation • Apr 27, 2020

1Q20 RESULTS

April 27 2020

1 An integrated energy player developing profitable and sustainable businesses

CAUTIONARY STATEMENT

This presentation 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 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, 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 longterm debt markets on a timely and affordable basis; the actions of consumers; other legal and political factors including 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, 2019 and available on our website at galp.com. Statements regarding potential future financial or operating results made at Galp's Capital Markets Day of February 18, 2020 should not be considered to be updated or re-affirmed as of any later date except to the extent specifically updated or re-affirmed in this release or in subsequent public disclosures. Forward-looking statements are statements other than in respect of historical facts and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied by such forward-looking statements. Important factors that may cause actual results to differ from forward-looking statements are referred in Galp's Management Report & Accounts for the year ended 31 December 2019. 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 announcement to reflect any change in events, conditions or circumstances.

RECENT DEVELOPMENTS AND OUTLOOK Carlos Gomes da Silva, CEO

DETERIORATING MARKET CONDITIONS

CAUSED BY COVID-19 AND LOWER COMMODITY PRICES

1Q20 oil price down 21% QoQ, with significant impact on upstream results

Oil prices consensus for the remaining quarters of 2020 now standing at sub-\$40/bbl

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Galp refining margin down to \$1.9/boe in 1Q20, already reflecting lower demand and oil product cracks

Weak global demand and inventory levels creating a challenging refining and gas trading environment

Lockdowns causing severe regional demand drops, notably in oil products

Uncertainty on the outbreak evolution and what could be the regional and global economic impact

ENSURING A TIMELY RESPONSE

TO UNPRECEDENTED CONDITIONS

Protecting People's safety and health

Ensuring business continuity and asset integrity

Assessing operational flexibility

Adapting activities to current and expected macro conditions Preparing lockdown exit strategies

Define businesses' adaptation to a "new normal"

5 1Q20 Results

PROMPT MITIGATION MEASURES

TO INCREASE RESILIENCE AND PROTECT FINANCIAL STRENGTH

Context	Response
Sharp demand decrease	Adapted business and operations
Low commodity price environment	High impact short term cash saving initiatives
Economic downturn	Portfolio management
High uncertainty and volatility

>€500 m

Annual Capex + Opex reduction

Capex Opex

FCF¹ neutral

@ Brent c.\$20/bbl

CAPITAL ALLOCATION GUIDELINES

ADJUSTING THE SHORT TERM WHILE KEEPING LONG TERM STRATEGY AMBITION

1Q20 Results

SHORT TERM OUTLOOK

EXPECTED MACRO VOLATILITY AND CURRENT COVID-19 TO IMPACT 2Q20 PERFORMANCE

Upstream

Adapting operations and maintenance activities

Refining & Midstream

Low demand and high inventory levels leading to refining slowdown

Commercial

Commercial activities impacted by demand constraints

Renewables & New Businesses

Closing of solar PV acquisition in Spain and partnership expected during 2Q20

Uncertain recovery profile from 3Q20 onwards. Prepared to adapt quickly if that is to happen sooner and stronger than expected.

GROUP EBITDA OF €469 M

REFLECTING MACRO ENVIRONMENT DETERIORATION

€m	1Q19	4Q19	1Q20
RCA Ebitda	494	653	469
Upstream	374	500	286
Refining & Midstream	27	52	90
Commercial	90	102	90
Renewables & New Businesses	0	-5	-1
RCA Ebit	278	354	217
Associates	36	21	19
Financial results	1	43	-60
Taxes1	-173	-215	-146
Non-controlling interests	-39	-46	-1
RCA Net Income	103	157	29
IFRS Net Income	-8	106	-257

Upstream impacted by lower WI production QoQ, due to planned maintenance, lower realisations and underlifting adjustments

Refining & Midstream supported by a swing in pricing lag effects from the sharp drop in commodity prices, despite HCC maintenance

Commercial with a resilient contribution despite Iberia's lockdown in March

Financial results driven by negative non-cash FX losses and MTM, offsetting positive cash contribution from Brent derivatives

RCA Net income of €29 m. IFRS net income negative at -€257 m, reflecting a significant accounting inventory effect (-€278 m)

CASH GENERATION INVENTORY EFFECT DRIVING WORKING CAPITAL RELEASE

CFFO of €244 m

IFRS Ebitda impacted by inventory effect, partially compensated by working capital release. Tax payments related to previous periods

Investment and financial cash flow

Net capex of €211 m, mostly allocated to Brazil and Mozambique. Derivative gains of €105 m from monetisation of Brent put options

FCF of €63 m

Post-dividend cash flow of -€45 m, including dividends paid to minorities in Brazil of €108 m

FCF 1Q20 (€m)

SOLID FINANCIAL POSITION

AS A BASIS TO HANDLE UNCERTAINTY

€m	31 Mar., 2019	31 Dec., 2019	31 Mar., 2020
fixed Net assets	7 380 ,	7 358 ,	7,439
of use (IFRS 16) Rights	1 209 ,	1 167 ,	1,171
Working capital	811	952	663
assets/liabilities Other	-704	-1 161 ,	-1,184
Capital employed	8,696	8,316	8,089
debt Net	1 603 ,	1 435 ,	1,496
(IFRS 16) leases Operating	1 230 ,	1 223 ,	1,232
Equity	862 5 ,	5 657 ,	5,360
Equity debt and op. leases , net	8,696	8,316	8,089

Debt

Stable debt position and extending average debt maturity, following a €200 m reduction of 2020 redemptions

Net debt to Ebitda

Ratio stable versus YE2019 at 0.7x¹

		1Q19	4Q19	1Q20
Working interest production	kboepd	112.6	136.9	131.4
Oil production	kbpd	99.5	121.8	118.1
entitlement production Net	kboepd	110.8	135.1	129.6
Angola	kbpd	8.7	13.3	14.1
Brazil	kboepd	102.1	121.8	115.6
- Dif Oil and gas realisations . to Brent	USD/boe	-8.9	-6.3	-5.8
Production costs	USD/boe	3.8	2.7	2.4
DD&A	USD/boe	13.5	15.2	13.1
RCA Ebitda	€ m	374	500	286
Ebit RCA	€ m	256	332	145
from Net Income Upstream Associates	€ m	16	0	-1
Capex	€ m	132	184	104

WI production slightly down QoQ, with the continued ramp-up of FPSOs Lula North and Berbigão/Sururu offset by planned stoppages

Ebitda impacted by lower realisations and underlifting adjustments in a period of steep oil price decline

DD&A benefiting from the reserves' 2020 upward revision in Angola

1Q20 REFINING & MIDSTREAM

EBITDA REFLECTING MACRO ENVIRONMENT VOLATILITY

		1Q19	4Q19	1Q20
Raw materials processed	mmboe	22.8	26.5	26.8
refining Galp margin	USD/boe	2.3	3.3	1.9
supply1 Oil products	mton	3.6	4.2	4.1
volumes1 NG/LNG supply & trading	GWh	22,925	23,232	17,705
Trading	GWh	9,501	8,960	5,303
of Sales electricity the grid to	GWh	339	354	339
RCA Ebitda	€ m	27	52	90
Ebit RCA	€ m	-48	-44	9
from Ref Net Income . & Midstream Associates	€ m	19	21	24
Capex	€ m	5	60	14

Refining performance impacted by the harsh macro environment and planned maintenance activities performed in Sines' HCC unit

NG/LNG supply & trading volumes down, reflecting the Iberian market contraction and lower gas trading volumes

Ebitda up both YoY and QoQ, despite weak refining, due to the swing in lag effects in the supply pricing formulas

1Q20 COMMERCIAL RESILIENT CONTRIBUTION DESPITE DEMAND WEAKNESS

		1Q19	4Q19	1Q20
Commercial sales clients to
Oil products	mton	2.1	2.0	1.8
Natural gas	GWh	8,863	7,762	6,728
Electricity	GWh	841	808	900
Ebitda RCA	€ m	90	102	90
RCA Ebit	€ m	70	69	68
from Commercial Net Income Associates	€ m	2	0	-3
Capex	€ m	2	34	24

Lower oil and gas sales to direct clients, already reflecting the impact from Iberian lockdowns during March

Sales of electricity supported by increased customer base

Stable results YoY supported by a stronger contribution from the Spanish activities

DEBT INDICATORS

€m	31 Dec., 2019	31 Mar., 2020
Cash and cash equivalents	1 460 ,	1,485
Undrawn credit facilities	1 163 ,	1,164
Gross debt	2 895 ,	2,981
Net debt	1 435 ,	1,496
(IFRS 16) leases Operating	1 223 ,	1,232
Net debt RCA Ebitda to	0 7x	0.7x
Undrawn credit facilities	1 163 ,	1,164
fixed % Debt at rate	41%	40%

Debt indicators Debt reimbursement (€m)

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