Moscow, 15 August 2017. PAO SIBUR Holding, an integrated gas processing and petrochemicals company, today published its operational and financial results for the six months ended 30 June 2017 in accordance with International Financial Reporting Standards (IFRS).
Operational highlights
- Gas fractionation volumes increased by 14.2%(1) year-on-year
- Polypropylene production volumes increased by 11.3% year-on-year
- Polyethylene production volumes increased by 9.4% year-on-year
- Elastomers production volumes increased by 11.3% year-on-year
Financial highlights:
- EBITDA increased by 15.0% year-on-year
- Revenue increased by 8.1% year-on-year
- Revenue from sales of energy products increased by 2.3% year-on-year
- Revenue from sales of plastics, elastomers and intermediates increased by 14.4% year-on-year
Operational Results
In the first half of 2017, SIBUR’s gas processing plants (GPPs) processed 11 billion cubic metres(2) of APG, and remained flat year-on-year. As a result, production of natural gas totaled 9.5 billion cubic metres(2). Raw NGL fractionation volumes increased by 14.2% year-on-year to 4.1 million tonnes(1) following the expansion of fractionation capacity in Tobolsk from 6.6 to 8 million tonnes in July 2016.
In the first half of 2017, SIBUR’s sales volumes of majority of its energy products remained flat year-on-year. External LPG sales volumes totaled 2.2 million tonnes. Natural gas sales volumes totaled 8.9 billion cubic metres.
We increased sales volumes of petrochemical products. Sales volumes of polypropylene increased by 7.7% year-on-year to 278 thousand tonnes due to an increase in capacity utilisation rate at our polypropylene production site in Tobolsk compared to year earlier as a result of lengthy maintenance shutdowns in the first half of 2016. Sales volumes of polyethylene increased by 16.7% year-on-year to 132 thousand tonnes following the production capacity expansion in Tomsk. On the back of improved demand sales volumes of elastomers increased by 4.3% year-on-year to 238 thousand tonnes.
| Operational results | |||
|---|---|---|---|
| Six months ended 30 June | Change % | ||
| Thousand tonnes, except as stated | 2017 | 2016 | |
| Processing and production volumes | |||
| APG processing (million cubic metres)(2) | 10,949 | 10,911 | 0.4% |
| APG processing, SIBUR's share (million cubic metres)(3) | 10,692 | 10,668 | 0.2% |
| Natural gas production (million cubic metres)(2) | 9,518 | 9,464 | 0.6% |
| Natural gas production, SIBUR's share (million cubic metres)(3) | 9,322 | 9,277 | 0.5% |
| Raw NGL fractionation(1) | 4,148 | 3,632 | 14.2% |
| Raw NGL fractionation, SIBUR’s share | 3,548 | 3,294 | 7.7% |
| Production of olefins and polyolefins | 1,324 | 1,214 | 9.0% |
| Production of plastics, elastomers and intermediates | 2,979 | 2,895 | 2.9% |
| Sales volumes | |||
| Natural gas (million cubic metres) | 8,922 | 8,867 | 0.6% |
| LPG | 2,210 | 2,186 | 1.1% |
| Petrochemical products, including | 1,842 | 1,707 | 7.9% |
| PP | 278 | 258 | 7.7% |
| PE | 132 | 114 | 16.7% |
| Elastomers | 238 | 229 | 4.3% |
| Plastics and organic synthesis products | 405 | 400 | 1.2% |
Financial results
In the first half of 2017, our revenue increased by 8.1% year-on-year to RR 212 billion with the following dynamics across the segments:
- Plastics, Elastomers & Intermediates revenue increased by 14.4% to RR 76.2 billion year-on-year; this segment made the highest contribution to the total revenue growth mainly due to the favourable market environment for elastomers in the first half of 2017;
- Olefins & Polyolefins revenue was flat at RR 42.6 billion year-on-year as higher revenue from PP and PE sales on increased volumes was offset by lower revenue from BOPP-films which was mainly a result of lower effective average selling prices;
- Despite the decrease in external sales volumes of naphtha and raw NGL our Feedstock & Energy segment revenue increased by 2.3% year-on-year to RR 79.3 billion due to higher selling prices for LPG;
- Unallocated revenue increased by 45.5% year-on-year to RR 13.8 billion, which was attributable to increased revenue of NIPIGAZ, as well as higher revenue from power and electricity sales following the acquisition of Tobolsk HPP in February 2016.
Our EBITDA increased by 15.0% year-on-year to RR 75.2 billion fueled by the strong performance of the Feedstock & Energy segment, which EBITDA increased by 43.9% year-on-year and compensated the 5.8% decrease in EBITDA of our Olefins & Polyolefins segment. The dynamics of Olefins & Polyolefins segment was attributable to higher intragroup liquids feedstock costs resulted from recovering oil prices with Brent gaining 30.4% year-on-year, which was partly compensated by higher selling volumes. EBITDA of our Plastics, Elastomers & Intermediates segment increased by 0.6% year-on-year.
Our net profit in the first half of 2017 increased by 4.0% year-on-year to RR 65.8 billion attributable to higher operating profit and partially offset by lower foreign exchange gain resulted from revaluation of debt denominated in foreign currencies due to immaterial RR appreciation within the first half of 2017 as opposed to the same dates of 2016.
Our capital expenditures decreased(4) 42.6% year-on-year to RR 48.7 billion mainly as a result of substantial advances paid in 2016 ahead of further equipment deliveries for ZapSib project according to contract terms and shifts in payments schedule with higher amounts to come in the second half of 2017. The overall progress of the project increased from 38% as of 1 January 2017 to 53% as of 30 June 2017.
| Financial results | |||||
|---|---|---|---|---|---|
| Six months ended 30 June | Change % | ||||
| RR millions, except as stated | 2017 | 2016 | |||
| Revenue (net of VAT and export duties): | 211,944 | 196,124 | 8.1% | ||
| Feedstock & Energy | 79,276 | 77,505 | 2.3% | ||
| Plastics, Elastomers & Intermediates | 76,192 | 66,614 | 14.4% | ||
| Olefins & Polyolefins | 42,634 | 42,490 | 0.3% | ||
| Unallocated | 13,842 | 9,515 | 45.5% | ||
| EBITDA | 75,157 | 65,380 | 15.0% | ||
| EBITDA margin | 35.5% | 33.3% | |||
| Net cash from operating activities | 63,291 | 59,865 | 5.7% | ||
| Net cash used in investing activities, including: | (29,413) | (85,524) | (65.6%) | ||
| Capital expenditures(4) | (48,713) | (84,861) | (42.6%) | ||
Borrowings
As of 30 June 2017, our total debt amounted to RR 302.4 billion, a decrease of 11.5% from 31 December 2016. The decrease was attributable to substantial repayment of conventional debt, partially offset by new drawdowns from ECA-backed credit facilities for ZapSib funding.
Our net debt(5) decreased by 7.1% to RR 261.2 billion as of 30 June 2017 comparing to 31 December 2016.
Our net debt to EBITDA ratio was 1.7х.
| Borrowings | |||
|---|---|---|---|
| RR millions, except as stated | As of 30 June 2017 | As of 31 December 2016 | Change % |
| Total debt | 302,399 | 341,813 | (11.5%) |
| Net debt5 | 261,183 | 281,178 | (7.1%) |
Full version of the Consolidated Interim Condensed Financial Information (unaudited) as of and for the six months ended 30 June 2017 in accordance with International Financial Reporting Standards (IFRS) is available on our website (http://investors.sibur.com/results-centre/financial-results.aspx).
(1) Including volumes under processing arrangements.
(2) Including Gazprom Neft’s share in the processing / production volumes of Yuzhno-Priobskiy GPP starting September 2015.
(3) Excluding Gazprom Neft’s share in the processing / production volumes of Yuzhno-Priobskiy GPP starting September 2015.
(4) Includes purchase of property, plant and equipment, intangible assets and other non-current assets.
(5) Net debt represents total debt less cash and cash equivalents.