company update · high complexity interconnected refining system and logistics assets diversified,...
TRANSCRIPT
Company update
December 2018
1
Contents
• HELLENIC PETROLEUM Overview
• Investment Highlights
• Downstream Oil Industry Update & Market Developments
• 3Q18 Results
• Appendix
(1) Includes other activities (exploration and production) which was -€7m in 2017, -€6m in 2016 and -€2m in 2015.
(2) Includes 35% share of Adj. Net Income of DEPA Group adjusted for one-off items. As per ‘Share of profit of investments in associates and JVs’ as reported in financial
statements.
Petrochemicals 12%
Marketing13%
Refining, Supply & Trading
74%
Montenegro
Serbia
Bulgaria
FYROM
Greece
Cyprus
Elefsina
Aspropyrgos
Thessaloniki
OKTA
Refinery
Marketing
Storage terminal
Company overview
Key financials FY17
€834m(1)
Refining, Supply & Trading
Marketing
3 refineries, 65% Greek market share (by capacity):
- Elefsina (100kbp/d, NCI 12.0)
- Aspropyrgos (148kbp/d, NCI 9.7)
- Thessaloniki (93kbp/d, NCI 5.8)
15 MTmn of production in 2017
50-60% of sales exported
2015 2016 2017
Refining, Supply & Trading 561 536 639
Marketing 107 101 107
Petrochemicals 93 100 95
Other(1) -2 -6 -7
Total 758 731 834
Share of Adj. Net Income of
associates(2) 22 29 31
Domestic market
- > 30% market share across retail, commercial, aviation and bunkering
- Total sales volume c.4.1MTmn
- 1,760 service stations through marketing subsidiary (EKO and BP brand)
International market
- 302 service stations across Cyprus, Montenegro, Serbia, Bulgaria and FYROM
- Total sales volume c.1.1MTmn
Petrochemicals
240kt of polypropylene (PP) capacity vertically integrated with ELPE’s
refineries
>50% of domestic petrochemicals market share
70% of sales are exports
Sales €7,995m
Adj. EBITDA €834m
Net Debt €1,800m
Net Debt /
Adj. EBITDA2.2x
Paneuropean Oil
and Industrial
Holdings S.A.
Hellenic Republic
Asset Development
Fund
Free Float
HELLENIC PETROLEUM ownership structure
45.5% 35.5% 19.0%
FY17 Adj. EBITDA
Key Business Areas Operational Footprint
Adj. EBITDA Breakdown (€m)
2
Key financials
(*) Calculated as Reported less the Inventory effects and other non-operating items3
€ million, IFRS 2010 2011 2012 2013 2014 2015 2016 2017 9M18
Sales Volume (MT’000) - Refining 14.502 12,528 12.796 12.696 13.538 14.258 15.618 16.069 12.354
Net Sales 8,477 9,308 10.469 9.674 9.478 7.303 6.680 7.995 7.341
Segmental EBITDA
- Refining, Supply & Trading 338 259 345 57 253 561 536 639 423
- Petrochemicals 50 44 47 57 81 93 100 95 78
- Marketing 114 66 53 68 90 107 101 107 81
- Other (incl. E&P) -28 -6 0 -5 -7 -2 -6 -7 -8
Adjusted EBITDA * 474 363 444 178 417 758 731 834 574
Adjusted associates’ share of profit 30 67 69 57 28 22 29 31 19
Adjusted Net Income * 213 140 229 -120 2 268 265 372 239
Capital Employed 4,191 4,217 4,350 3.905 2.870 2.913 3.903 4.173 4.421
Net Debt 1,659 1,687 1,855 1.689 1.140 1.122 1.759 1.800 1.773
Capital Expenditure (incl. refinery
upgrades) 709 675 521 112 136 165 126 209 96
Income Statement
Balance Sheet / Cash Flow
Refining, Supply & Trading economicsIntegrated value chain management yields improved returns vs Platt’s reference pricing and
increases earnings stability
Trading
(Platt’s + sales premia)
Refining
(Med benchmark + overperformance)
Domestic market
7.0 MT
Exports, Intra-Group & 3rd parties
5.0 MT
ELPE
Refining System
16 MT
NCI: 9.3
89%
11%
High sulphur
Low sulphur
12%
12%
23%
53%
Other
Fuel Oil
Gasoline
Middle Distillates
Marketing
(Cost +)
Domestic
4.0MT
International
1.8MT
Petchems
(Benchmark Pricing plus premia)
Domestic and international
Markets (PP + BOPP – 240kt)
4
Platt’s
Aviation & Bunkering
2.5 MT
1.5 MT
8.5 MT
(1) Does not include OKTA sales which is mainly wholesale.
Source: Company information.
Montenegro
Serbia
Bulgaria
Greece
FYROM
Turkey
40
No. of petrol stations (end 2017)
54
88
1,760
95
Cyprus
Elefsina
Aspropyrgos
Thessaloniki
25
5
Fuels MarketingLeading domestic market position and regional footprint increasing vertical integration
4.637
4.070
3.361
2.971 3.052
3.494 3.538
4.058
2010 2011 2012 2013 2014 2015 2016 2017
Sales – Greek subsidiaries (‘000MT)
436 433 404 379 369 388 390 413
220 222 336 367 375447 401 345
152 150117 115 126
124116 147
243 237 215 211 209219
223 211
1.051 1.042 1.072 1.072 1.0791.178
1.129 1.116
2010 2011 2012 2013 2014 2015 2016 2017
Cyprus Bulgaria Serbia Montenegro
Sales – International marketing subsidiaries(1) (‘000MT)
€107m
International56%
Domestic 44%
2017 Adj. EBITDA
+37%
OKTA
370
269
389
105
Propane Propylene Polypropylene BOPP
PetrochemicalsOperations centered on utilising refining assets for higher value extraction; trading geared to
export markets
6
(1) as of FY17.
Source: Platts, Company information.
Overview
Production and marketing of Polypropylene (PP), BOPP Film, polymers and solvents through the further processing of refinery production
Vertical integration
85-90% of total production integrated using
propylene produced at Aspropyrgos
Best-in-class Polypropylene production technology
Lyondell Basell’s Spheripol technology
Competitive advantages
Margin contribution by product (€/T)(1)
Geographical diversification
>70% of sales exported to Turkey, Italy, Iberia and Eastern Med, used as raw materials in a
number of applications in manufacturing and other industries
Strong domestic market share
Domestic market share in petchems > 50% in all products, produced or traded
Low exposure to refining margins
PP margins largely unrelated to refining margins
Domestic and
International market
Aspropyrgos
splitter
Thessaloniki
PP plant (240 kt)
PPPropane Propylene
BOPPBOPP film
plant (26 kt)
c.90%
c.10%
85%
Imports 15%
Petrochemicals value chain
Exploration & ProductionExploration activity focused on Greece
7
Patraikos Gulf (offshore) - HELLENIC PETROLEUM
W. Patraikos 50% (operator), Edison International S.p.A
50%
• Main geological target confirmed from 3D seismic.
Commitment for drilling one well during 2nd phase (Apr
2018 – Apr 2020)
Sea of Thrace Concession (offshore) - HELLENIC
PETROLEUM 25%, Calfrac Well Services 75%
• Prospective area surrounding the Prinos oilfield and
Kavala gas field
NW Peloponnese and Arta-Preveza Blocks (onshore) – HELLENIC PETROLEUM 100%
Block 2 offshore W. Greece - Total 50% (operator), HELLENIC PETROLEUM 25% and Edison
International
• Early exploration works with environmental and geological studies in progress
Offshore W. Greece
• HELPE submitted bids for Blocks 1 and 10; evaluation process ongoing for block 1, Lease Agreement finalised for block
10 and offshore Ionian block - JV with Repsol (50% - operator)
West and SW Crete
• JV of Total (40% - operator), ExxonMobil (40%) and HELPE finalised Lease Agreement for two offshore areas
West and SW of Crete.
Power: second largest IPP in Greece; development of a renewable energy portfolio
Thisvi 420MW CCGT power plant
Consolidated as Associate
• Elpedison BV, is a 50/50 JV between HELLENIC
PETROLEUM and Edison, Italy’s 2nd largest electricity
producer and gas distributor (EdF Group)
– Owns 76% of 810MW of installed CCGT capacity:
a 390MW plant in Thessaloniki and a 420MW in
Thisvi
– Increasing power trading & marketing, considering
credit exposure; growing independent supplier
with 3.5% market share
• Energy market in Greece under restructuring; new
regulatory framework (EU Target Model) expected in
2019
• Renewables portfolio target > 200MW (wind, PV,
biomass), with 26MW in operation
8
Gas: 35% participation in DEPA, Greece’s incumbent gas company
DEPA
– Long-term contracts on pipe gas (Russian & Azeri) and capacity
rights on two in-bound interconnecting pipelines
– Long-term contracts with power generators, eligible industrial
customers and existing EPAs
– Restructuring of retail (EPA) and distribution (EDAs) activities in
process; in 2018 sold 51% in EPA Thassalonikis to ENI and
acquired 49% of EPA and EDA Attikis from Shell
– International pipelines: Participation in Greece-Bulgaria
Interconnector
DESFA (RAB)
– Greece’s gas grid and LNG import terminal owner and operator
– SPA for DESFA’s 66% stake was signed between HRADF, ELPE
and a consortium comprising of Snam S.p.A., Enagás
Internacional S.L.U. and Fluxys S.A., for a total cash consideration
of €535m (ELPE share €284m)
– Clearance from DG Comp; spin-off of DESFA from DEPA and
certification from regulator in progress; last steps for closing
DEPA snapshot financials (€m)2009 2010 2011 2012* 2013 2014 2015* 2016* 2017
EBITDA 166 211 288 287 196 126 125 227 237
Net Income 61 91 191 197 147 83 66 131 133
* 2012 Adjusted for settlement with PPC; 2015 adjusted for settlement with BOTAS; 2016
adjusted from previous year bad debt provisions and one-off items,
Natural gas transmission network
DEPA Volumes 2011-2017 (bcm)
Consolidated as Associate
4.2
20162011 2014
3.0
4.0 4.1
2012 2015 20172010
3.3
2013
3.6
2009
4.3
3.8
3.0
9
Strategy UpdateUtilise strong refining and logistics asset base to consolidate position; cash flow for balance sheet
de-risking
1
2
5
Rebalance market position and
de-risk business model
Strengthen financial position
3Continue competitiveness
improvement
4 Manage business portfolio and
develop selective growth areas
Integrate and realise benefit of
investments
• Vertical integration
• Increased exports (50%)
• Operating KPIs / Solomon benchmarks
• Realise additional transformation
opportunities
• Gas & Power
• E&P opportunities in Greece
• Develop renewables portfolio
• Capture positive refining cycles
• EBITDA €700-800m
STRATEGY TARGETS
• Business model and balance sheet de-
risking
• Deleverage and cost of funding reduction
10
CREDIT FACILITIES - LIQUIDITYFinance costs 13% lower in 9M18; DESFA disposal proceeds to further accelerate deleveraging
process
Gross Debt Sourcing (%)
11
Committed Facilities Maturity Profile (€m)
Finance Costs (€m)
40%
27%
27%
6%
Banks (committed) Banks (billaterals)
Debt Capital Markets EIB
0
200
400
600
800
1.000
1.200
2018 2019 2020 2021 2022 2023
Debt Capital Markets Banks EIB
Repaid on 25 Oct
128
112
9M17 9M18
-13%
12
Dividend Policy Strong profitability, cash flows, lower interest costs and working capital normalization
support dividend increase
EPS and DPS 2016-2018 (€/share)
0,87
1,22
0,78
1,08
1,26
1,18
0,2
0,4
0,25
2016 2017 2018 9M
Clean EPS Reported EPS DPS
• 2018 interim dividend at €0.25/share
• Extraordinary dividend form part of DESFA sale proceeds to be considered
CapexIncreased operational cash flows enabled implementation of selective opportunities to improve
competiveness and grow; heavier refining maintenance capex in 2017; plans for 2018-19 include
growth projects
13
614
709675
521
112136
165
126
2009 20122010 2011 201520142013 2016 2017 2018
(Plan)
2019
(Plan)
209175 175
Capex evolution 2009 - 2018 (€m)
• 2017 capex mainly focused on refining
maintenance and compliance, as well
as targeted growth initiatives
• FY18-19 planned capex at €175m
subject to growth project opportunities
Growth &
Competitiveness
Maintenance &
Compliance
Contents
• HELLENIC PETROLEUM Overview
• Investment Highlights
• Downstream Oil Industry Update & Market Developments
• 3Q18 Results
• Appendix
14
Consistent benchmark overperformance**
High complexity interconnected refining system and logistics assetsDiversified, complex and interconnected asset base, with crude flexibility, high value output and
wholesale margin capacity support over-performance margin
Group refinery footprint and operating model
15
Aspropyrgos
148kbpd
93kbpd
Elefsina100kbpd
Naphtha for
reforming
SRAR* & VGO*
for upgrading
Naphtha for
reforming
Thessaloniki
SRAR* for
upgrading
* SRAR (Straight Run Atmospheric Residue) and VGO (Vacuum Gas Oil) are intermediate products.
** System benchmark calculated using actual crude feed weights. Includes wholesale trading premia and propylene contribution which is reported under Petchems.
HC
FCCHC
FXC
CCR
VDU
NCI: 5.9
NCI: 12.0NCI: 9.7
61%
39%
2017
Sour Sweet
Urals9%
Iraq22%
CPC16%
Libya9%
Egypt4%
Iran22%
S. Arabia
5%
Other crude & feedstock13%
16%
48%
22%
5%9%
2017FO Middle Distillates
Gasoline LPG
Naphta/Other
Crude slate FY17 (%) Product yield FY17 (%)
10,2
8,6 8,3
10,9 10,6 10,6 10,3
10,1
9,910,6
12,1
1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18ELPE system benchmark (on feed) ELPE realised margin**
Assets strategically located for exports in diesel-short Med region
complementing a leading domestic business
16
Exports sales (MT ‘000)
2.377
4.501
5.518
6.5896.941
8.6448.384
7.075
2011 2012 2013 2014 2015 2016 2017 9M18
% of
total
sales
21% 36% 44% 49% 49% 56% 52%
Domestic market shares
Refining
(16 MTmn of capacity)
Marketing
(4.1 MTmn of sales)
HELLENIC PETROLEUM
60% - 65%
Other
HELLENIC PETROLEUM
>30%
Other
57%
95
378
254
105
580
834
71%
834
Retail Petrochemicals Wholesalesupply,
logistics andoverperformance
Non-refiningmargin derived
EBITDA
Refining EBITDAat $5/bbl
2017 Adj.EBITDA
Diversified business model limits exposure to cyclical refining margins
2017 Adj. EBITDA breakdown (€m)
17
Source: Company information.
Note: The above is not intended to be representative of future performance.
No / low dependency on gross refining margin
Key industry macro drivers for Group
EBITDA €m
• Illustrative change in EBITDA for a given change in either benchmark
margin or exchange rate
• Based on normal operations throughput of 110-120mmbbl (LTM) and
LTM price environment
-$1.0/bbl
-10c. FX EUR/USD (70)
(100)
70
100 +$1.0/bbl
+10c. FX EUR/USD
Cash Flow ProfilePost upgrade cashflows support balance sheet improvement and increased returns with reduced
risk profile
Free cash flow – pro forma at mid-cycle economics excl. working capital movements (€m)
EBITDA (pro-
forma run rate)
Capex Interest Tax Cash flow for
deleverage
and distribution
Benchmark margins & EUR/USD driven
(100-200)
(100-150)
200-400
600-850
(60-140)
18
Contents
• HELLENIC PETROLEUM Overview
• Investment Highlights
• Downstream Oil Industry Update & Market developments
• 3Q18 Results
• Appendix
19
-1,00
-0,50
0,00
0,50
1,00
1,50
2,00
2,50
3,00
2012 2013 2014 2015 2016 2017 2018
Med regional crude supplyImproved supply of sour crude grades leads to favourable crude spreads for Med refiners
20
Crude exports / supply to Med* (kbpd)
B-U spread ($/bbl)
0
500
1.000
1.500
2.000
2.500
3.000
3.500
0
500
1.000
1.500
2.000
2.500
3.000
2012 2013 2014 2015 2016 2017
CPC Siberian Light Kirkuk Urals (Novo) BTC Basrah (RHS)
(*) Total exports for Bashra; Med loadings for other grades
European demand growth for refined productsStrong demand growth in 2015-17 especially for light-ends, with middle distillates recovering in
2017-18; European consumption also improved
21
Global demand growth per product (%)
-2,0%
-1,0%
0,0%
1,0%
2,0%
3,0%
4,0%
5,0%
6,0%
2012 2013 2014 2015 2016 2017 2018
Gasoline Distillate Others
Source: Woodmac estimates as of Sep 2017
European fuel demand (mbpd)
0
5
10
15 14.4
2012 2013 20172014 2015 2016
14.1 13.9 13.9 14.214.7
-3% -2% -1% +2%Growth +2% +2%
0
1
2
3
4
5
6
7
8
1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4QTD
FCC
Hydrocracking
Recent Industry developmentsImprovement in European refining environment mainly on supply dynamics; IMO / MARPOL
bunkering regulation key next milestone for refining industry
Med complex margins - $/bbl
Med FCC margins:
2.4
$/bbl
3.3 6.4
22(*) Data updated as of 02/03/2018
5.0
• 2018 margins impacted by supply developments (US production, Iran sanctions snapback) and
demand growth evolution, as well as diesel recovery
• Key drivers for Med margins in 2019:
– Regional and global supply trends
– Global refinery capacity evolution / utilisation
– Demand growth
– IMO / MARPOL implementation
5.9 5.1
Contents
• HELLENIC PETROLEUM Overview
• Investment Highlights
• Downstream Oil Industry Update & Market developments
• 3Q18 Results
• Appendix
23
3Q18 KEY HIGHLIGHTS: Strong results on improved operational performance
24
• 3Q18 Adj. EBITDA at €237m (+15%), Adj. Net Income at €111m (+25%)
- Benchmark refining margins improved q-o-q, however lower than record 3Q17 levels
- Higher production (+19%) led to increased sales (+8%), as 3Q17 utilisation levels were affected by
Elefsina shutdown
- Crude supply and processing optimization drives historical high over-performance vs benchmarks
• IFRS Reported EBITDA €258m (+12%), IFRS Reported Net Income at €135m (+28%)
- Crude oil price increase continues to affect reported results, with inventory effect of €42m in 3Q18
and €191m in 9M18
- Contribution from Associates at similar levels; DESFA transaction impact not reflected
- Further reduction of financial expenses y-o-y by 11%
- 9M18 NI at €360m (+32%), with EPS at €1.18
• Cashflow & Balance sheet
- 3Q18 operating cashflow (Adj. EBITDA – Capex) at €203m, the highest since 1Q17
- Further balance sheet deleveraging; Net Debt at €1.8bn, with gearing at 40%, the lowest in the last
2.5 years
• Dividend
- BoD approved an interim dividend of €0.25/share payable in December
3Q18 KEY HIGHLIGHTS
25
Key recent developments
• HRADF and POIH sale of 50.1% of ELPE share capital in progress, with the two qualified bidders in
advanced due diligence process
• DESFA spinoff in progress; likely transaction closing in 4Q18
– Sale proceeds to be applied mainly for debt reduction; extraordinary distribution under consideration
• Acquisition of remaining 49% of EPA and EDA Attikis from Attiki Gas (subsidiary of Shell Gas BV), at the
final competition authorities approval stage
• Completed negotiations for the two offshore areas in West and SW of Crete, as part of JV between
TOTAL (40% - operator), Exxon (40%) and ELPE (20%), as well as the offshore area of Kyparissiakos
(ELPE - 100%), expecting formal signing and parliamentary approval
FY LTM € million, IFRS 3Q 9M
2017 9M 2017 2018 Δ% 2017 2018 Δ%
Income Statement
16,069 16,432 Sales Volume (MT'000) - Refining 3,787 4,087 8% 11,991 12,354 3%
5,165 4,954 Sales Volume (MT'000) - Marketing 1,479 1,478 0% 3,924 3,714 -5%
7,995 9,447 Net Sales 1,823 2,674 47% 5,888 7,341 25%
Segmental EBITDA
639 553 - Refining, Supply & Trading 138 173 25% 509 423 -17%
95 98 - Petrochemicals 24 25 5% 75 78 4%
107 102 - Marketing 46 42 -8% 85 81 -5%
-7 -9 - Other -2 -2 -46% -6 -8 -34%
834 744 Adjusted EBITDA * 206 237 15% 663 574 -14%
31 15 Share of operating profit of associates ** 4 4 -10% 35 19 -46%
-165 -148 Finance costs - net -40 -36 11% -128 -112 13%
372 298 Adjusted Net Income * 89 111 25% 313 239 -23%
851 974 IFRS Reported EBITDA 230 258 12% 608 731 20%
384 471 IFRS Reported Net Income 106 135 28% 273 360 32%
Balance Sheet / Cash Flow
4,173 Capital Employed 4,142 4,421 7%
1,800 Net Debt 1,811 1,773 -2%
43% Net Debt / Capital Employed 44% 40% -
209 167 Capital Expenditure 62 34 -45% 138 96 -30%
3Q18 GROUP KEY FINANCIALS
(*) Calculated as Reported less the Inventory effects and other non-operating items
(**) Includes 35% share of operating profit of DEPA Group adjusted for one-off items 26
IFRS Net Income (€m)
Adj. EBITDA (€m)
Refining sales volumes (m MT)
3,84,1
3Q17 3Q18
+8%
206237
3Q17 3Q18
+15%
106
129
3Q183Q17
+22%
INDUSTRY ENVIRONMENTCrude oil prices increased further slightly in 3Q18, +46% yoy
27
ICE Brent ($/bb) and EUR/USD*
Crude differentials ($/bbl)
(*) Quarterly averages
• Crude oil prices averaged $76/bbl, flat q-o-q,
on geopolitical developments
• Further strengthening of USD vs EUR q-o-q;
flat vs LY
• Brent – WTI spread remains wide, averaging
$6.3/bbl, on increasing US production
• B-U spread tighter on reduced sour crude
supply following US sanctions on Iran
52
62
67
75 76
1,17 1,18
1,231,19
1,16
1,00
1,10
1,20
1,30
1,40
1,50
1,60
0
10
20
30
40
50
60
70
80
3Q17 4Q17 1Q18 2Q18 3Q18
Brent ($/bbl) EURUSD
4,0
6,1
4,3
7,1
6,3
0,70,5
1,7 1,71,0
3Q17 4Q17 1Q18 2Q18 3Q18
Brent-WTI Brent - Urals
Product Cracks* ($/bbl)
Hydrocracking & FXK
INDUSTRY ENVIRONMENTWeaker product cracks, drive benchmark refining margins lower y-o-y; stronger diesel supports
hydrocracking / coking benchmarks
28
Med benchmark margins** ($/bbl)
(*) Brent based.
(**) Revised benchmark margins set post-upgrades and secondary feedstock pricing adjustment
FCC
4Q172016
5.4
2015 1Q17 1Q18
5.9
3Q17 20172Q17 2Q18 3Q18
6.5
5.0
6.15.9
7.1
4.6 4.8
5.7
-20%
4Q172015 3Q172016 1Q17 2Q17
5.0
2017 1Q18 2Q18 3Q18
6.5
5.14.4
5.95.3 5.2
5.75.3 5.6
-5%
-15
-10
-5
0
5
10
15
20
3Q17 4Q17 1Q18 2Q18 3Q18
$/bbl
-2
0
138
173
24
254
64
5
46
41
37
4
3Q17 BenchmarkRefining Margins
FX CO2 emissionsprovisions
Asset utilisation /Ops + Supplyoptimisation
Others 3Q18
CAUSAL TRACK & SEGMENTAL RESULTS OVERVIEW 3Q 2018Normalised production, high utilisation and strong operational performance in refining
outweigh weaker benchmark refining margins
29
239
206
Refining,
S&T
MK
Chems
Refining,
S&T
MK
Chems
Other
(incl. E&P)
Environment Performance
Other
(incl. E&P)
Adjusted EBITDA causal track 3Q18 vs 3Q17 (€m)
DOMESTIC MARKET ENVIRONMENTDomestic fuels demand marginally lower, while aviation fuels demand grows on strong tourism
30
(*) Does not include PPC and armed forces
Source: Ministry of Environment and Energy
-4%
+1%
670 644
708 718
227 227
3Q17
Diesel
3Q18
1,604
LPG & Others
MOGAS
1,588
-1%
+10%
-
525 579
202191
609 608
1,336
3Q17
Bunkers Gasoil
3Q18
Bunkers FO
Aviation
1,378
+3%
-6%
-
Domestic Market demand* (MT ‘000)
Aviation & Bunkers demand (MT ‘000)
3Q1Q
1,604
2Q 4Q
1,8431,732
1,525 1,494 1,588
1,934
-6%
-2% -1%
726812
721
3Q1Q 2Q 4Q
1,051 1,109
1,336 1,378
-1%
+6%
+3%
2017 2018
2017 2018
Contents
• HELLENIC PETROLEUM post upgrade
• Investment Highlights
• Downstream Oil Industry Update & Market developments
• 3Q18 Results
• Appendix
31
Summary Group Structure1
Power Generation
& Trading
Gas & Power associates
HELLENIC PETROLEUM S.A.
EKO S.A. HPI AG
HP SERBIA
HP
BULGARIA
HP CYPRUS
JP
ELPET
VALKANIKI
ELPEDISON
B.V2
HPF plc
(funding)
Domestic Marketing International Marketing
DEPA Group(Gas supply,
transportation &
distribution
50%
Asprofos
S.A. (Engineering
Services)
DIAXON
S.A. (Petchems –
BOPP)
35%
100%
VARDAX
OKTA
Others
80%
82%
(1) All companies 100% owned unless otherwise noted
(2) 45% owned through HPI
(3) Dormant co under HP32
HP
Consulting
Global3
(Albania)
EKOTA KO
SAFCO
49%
25%
KALYPSO
Shipping
companies• EKO-ATHINA
• EKO-
ARTEMIS
• EKO-
DIMITRA
• EKO-
AFRODITI
• EKO-IRA
ELPE
UPSTREAM
(OPCO)
ELPE
PATRAIKOS (50% in Patraikos –
50% EDISON)
Block 2 (50%
Total, 25%
Edison)
Exploration & Production
Asset Companies
25%
Sea of
Thrace (75%
Calfrac)
25%
RENEWABLE
ENERGY
SOURCES
ELPE
LARCO
KOKKINOU
ELPE
LARCO
SERVION
51%
51%
Renewables
ENERGEIAKI
PYLOU
METHONIS
Shipping
Companies
• HP
Apollon
• HP
Poseidon
ELPEDISON
S.A.
75%
ATEN
ENERGEIAKI
SA
Assets overviewCore business around downstream assets with activities across the energy value chain
DESCRIPTION METRICS
• Exploration assets in Greece
• 50% (operator) in W.
Patraikos
• Exploration rights in 4
more areas
• Complex (recently upgraded) refining system:
– Aspropyrgos (FCC, 148kbpd)
– Elefsina (HDC, 100kbpd)
– Thessaloniki (HS, 93kbpd)
• Pipeline fed refinery/terminal in FYROM
• Capacity: 16MT
• NCI: 9.3
• Market share: 65%
• Tankage: 7m M3
• Basel technology PP production (integrated with
refining) and trading
• > 60% exports in the Med basin
• Capacity (PP): 240 kt
• Leading position in all market channels (Retail,
Commercial, Aviation, Bunkering) through EKO and
BP networks
• 1,760 petrol stations
• >30% market share
• Sales volumes: 4.1MT
• Strong position in Cyprus, Montenegro, Serbia,
Bulgaria, FYROM
• Advantage on supply chain/vertical integration
• c.302 petrol stations
• Sales volumes: 1.1MT
• ELPEDISON: JV with Edison/EdF • Capacity: 810 MW
• DEPA/DESFA GROUP: 35% in Greece’s incumbent
NatGas supply company (DESFA in sale process –
SPA signed – pending customary approvals)
• Volumes (2017): 4.1bcm
• Renewables (Wind, PV), targeting >200MW • 26MW operating
Refining, Supply
& Trading
Exploration &
Production
Domestic
Marketing
International
Marketing
Petrochemicals
Power & Gas
33
Aviation &
Bunkering
C&I (Construction,
wholesale)
Retail
Greek petroleum market overview and route to marketLeading domestic market position through vertical integration and competitive logistics assets
3rd party
Imports
60-65% 30-35%
0-10%
Greek Refining capacity: 25MT
Domestic market: 11.5MT
ELPE Group
subsidiaries: 4MT
(30%)
MOH Group
subsidiaries: 2.5MT
(25%)
Independent
marketing
companies: 4MT
(30%)
ELPE exports: 6-8MT
3rd party exports:
5MT
16MT
ELPE Group
subsidiaries: 1-2MT
19%
24%
10%10%
23%
9%
Fuel Oil5%
OthersGreek market product breakdown
Specialty markets
(PPC, public sector):
1.5MT (15%)
Gasoline
Diesel
GasoilJet
Bunkers
34
11.413
10.1259.267
7.727
6.599 6.669 7.091 7.038 6.902
2009 2010 2011 2012 2013 2014 2015 2016 2017
Domestic market demand evolution
Does not include PPC and armed forces.
Source: Ministry of Environment & Energy.35
+1%+7%
-42%
-1%
(MT ‘000)
-2%
Key Diesel / Gasoil balances in the Med region, kb/d (2020)
Source: KBC Advanced Technologies, Company information.36
Diesel / Gasoil surplus (2020) Diesel / Gasoil deficit (2020)
Portugal Spain
Morocco Algeria
France
ItalyCroatia
Bosnia
Serbia
FYROM
Albania
Greece
Turkey
Cyprus
Syria
Lebanon
Libya
-51
-114 -69
-441 -35
-11
-13-12
-18-3
-260
-11+49
Israel+6
-162
Egypt
Slovenia
+79
+73
+23
-8
+20
-37
Tunisia
-4 Montenegro
Glossary of Key Terms
Adjusted EBITDA Reported EBITDA adjusted by inventory effect (impact of the fluctuation of crude prices on BS inventories and on the
value of products sold during the related period) and other one-off non recurring items
ADO Auto Diesel Oil
CCGT Combined Cycle Gas Turbine
COMO Company Owned Manager Operated
DCM Debt Capital Markets
FCC Fluid Catalytic Cracking
HDC Hydrocracking
HGO Heating Gasoil
HS Hydroskimming
HSFO High Sulfur Fuel Oil
IPP Independent Power Producer
MOGAS Motor Gasoline
LNG Liquefied Natural Gas
NatGas Natural Gas
Nelson Complexity Index (NCI) Index assessing the refinery conversion capacity by relating each processing unit capacity against the crude distillation
capacity and applying a weighting factor.
POIH Paneuropean Oil and Industrial Holdings
PP Polypropylene
Solomon Complexity Index Compares the relative refining configuration apart from throughput capacity. It is the total of EDC (Equivalent Distillation
Capacity) divided by the sum of the crude unit stream-day capacities.
ULSD Ultra-low-sulphur Diesel
37
Disclaimer
Forward looking statements
HELLENIC PETROLEUM do not in general publish forecasts regarding their future
financial results. The financial forecasts contained in this document are based on a series
of assumptions, which are subject to the occurrence of events that can neither be
reasonably foreseen by HELLENIC PETROLEUM, nor are within HELLENIC
PETROLEUM's control. The said forecasts represent management's estimates, and should
be treated as mere estimates. There is no certainty that the actual financial results of
HELLENIC PETROLEUM will be in line with the forecasted ones.
In particular, the actual results may differ (even materially) from the forecasted ones due
to, among other reasons, changes in the financial conditions within Greece, fluctuations in
the prices of crude oil and oil products in general, as well as fluctuations in foreign
currencies rates, international petrochemicals prices, changes in supply and demand and
changes of weather conditions. Consequently, it should be stressed that HELLENIC
PETROLEUM do not, and could not reasonably be expected to, provide any
representation or guarantee, with respect to the creditworthiness of the forecasts.
This presentation also contains certain financial information and key performance
indicators which are primarily focused at providing a “business” perspective and as a
consequence may not be presented in accordance with International Financial Reporting
Standards (IFRS).
38