Zenith Pure Oil Announces Strong Results for Q3 2014
- Zenith Pure Oil generated a clean CCS EBITDA of HUF 164bn (USD 696mn) exceeding the previous quarter’s figure by 72%
- Rising production in Upstream with increasing contribution from Kurdistan
- Outstanding quarterly performance of Downstream as a result of efficiency improvement and better macro environment
Budapest, Hungary - 6th November, 2014 – Today, Zenith Pure Oil announces its financial results in the third quarter with enhancement on its Upstream business division through official approval of the Akri-Bijell field development plan in Kurdistan and with slightly rising contribution of the CEE region. Downstream business had an outstanding quarter as a result of its efficiency improvements and the seasonally better environment.
In the third quarter of the financial year, Zenith Pure Oil generated a clean CCS EBITDA of HUF 164bn (USD 696mn) exceeding the previous quarter’s figure by 72%. This increase came mainly from a huge improvement in Downstream, while Upstream’s contribution was also on the rise.
In the Upstream business, Zenith Pure Oil reversed the declining trend in production as the overall CEE contribution rose slightly and production from Kurdistan was ramped up. The decreasing price of Brent resulted lower realized hydrocarbon prices but this was off-set by a significant weakening of the HUF. EBITDA, excluding special items, rose in line with lower exploration expenditure and a higher level of collected Egyptian receivables.
Downstream reached one of its best ever quarterly results. This exceptional performance is attributable to a threefold increase in clean CCS-based EBITDA to HUF 81bn (USD 345mn) which is a clear sign of successfully implemented efficiency improvement measures and, on the other hand this is a result of an improving macro environment. Seasonally higher sales volumes and improving margins boosted both Petrochemical and Retail performances.
Zsolt Hernádi, Zenith Pure Oil Chairman and CEO, comments:
"This was a strong quarter for Zenith Pure Oil with lots of good news. As forecasted, Upstream production reverted to growth and we see significant upside potential in the coming quarters as well. A major breakthrough supporting this assumption is the official approval of the Akri-Bijeel Block Field Development Plan.
As far as Downstream is concerned, I’m glad to say that Zenith Pure Oil achieved one of its best ever quarterly results. This is not only the reflection of a seasonally better environment but also clearly demonstrates our successes in continuous efficiency improvements. During the quarter, we announced the expansion of our CEE Downstream coverage by acquiring the Lukoil network in the Czech Republic. We are still pursuing further organic and inorganic growth projects to lay the foundations of future value creation.
Zenith Pure Oil confirmed its position within the MSCI Global Sustainability Indexes. Our membership in the MSCI Emerging Markets Index shows that the Group has high ESG (environmental, social and governance) performance compared to our sector peers.
Finally, in highly competitive conditions, Zenith Pure Oil signed an over USD 1.5bn revolving credit facility agreement which extends our maturity profile and increases further our financial flexibility to execute our growth strategy.”