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Romania's OMV Petrom H1 profit rises on stronger fuels, heating oil sales

Author Mario Tanev
Romania's OMV Petrom H1 profit rises on stronger fuels, heating oil sales

BUCHAREST (Romania), July 31 (SeeNews) - Romania's largest oil and gas group OMV Petrom [BSE:SNP] said on Wednesday its consolidated net profit grew to 1.97 billion lei ($464 million/416 million euro) in the first half of 2019 from 1.29 billion lei a year earlier, backed by a rise in revenue.

Total consolidated revenue increased to 11.51 billion lei in the first six months of the year from 9.94 billion lei in the comparable period of 2018, OMV Petrom, a unit of Austria's OMV Group, said in an unaudited interim financial statement.

The rise was prompted mainly by sales of fuels and heating oil, which grew to 6.56 billion lei in the review period from 5.77 billion lei the year before.

Natural gas, liquefied natural gas (LNG) and electricity sales increased to 2.55 billion lei from 2.23 billion lei, while sales of crude oil and natural gas liquids (NGLs) fell to 239.9 million lei from 288.8 million lei.

The company closed the first half of 2019 with an operating profit of 2.26 billion lei, up from 1.78 billion lei profit in the corresponding period of last year.

OMV Petrom's downstream segment boasted a 40% year-on-year rise in its first-half operating profit, to 925 million lei. The segment had a strong second quarter, which ended with a 67% growth in operating profit, to 358 million lei.

The segment's operating result was also backed by positive current cost of supplies (CCS) effects of 25 million lei, due to higher quotations in the first two months of the second quarter, and a special gain of 12 million lei, mainly representing unrealized gains from the valuation of electricity forward contracts.

The group's upstream segment recorded a 9% increase in the first-half operating profit, despite a 13% drop in the second quarter. The segment's second-quarter result was affected by lower oil prices.

The upstream segment capital expenditure, including capitalized E&A, fell by an annual 8% to 1.33 billion lei in the first half, as lower investments for Neptun development and lower offshore drilling were partly compensated by higher workover activities.

Downstream investments nearly halved to 356 million lei in the first six months of 2019 from 661 million lei in the same period of 2018.

OMV Petrom's assets amounted to 44.35 billion lei at the end of June, up from 43.78 billion lei a year earlier.

As at 9:20 CET on Wednesday, OMV Petrom's shares traded 1.52% higher at 0.40 lei on the Bucharest Stock Exchange.

(1 euro = 4.7325 lei)