TIDMSNGR
RNS Number : 7760V
S.N.G.N. Romgaz S.A.
12 August 2022
BOARD OF DIRECTORS' REPORT
1(ST) HALF YEAR 2022
IDENTIFICATION DETAILS ON REPORT AND ISSUER
Report based on Law no. 24/2017 on issuers of financial
instruments and market operations (Article
67) and ASF (Financial Supervisory Authority)
Regulation no.5/2018 on issuers of financial
instruments and market operations (Annex
14) for the six-month period ended on
June 30, 2022 (HI of financial year 2022)
GEO No.109 of November 30, 2011 on corporate
governance of public enterprises, as subsequently
amended and supplemented - art.55 para
(1)
Report Date August 12, 2022
Name of the Company Societatea Na ional de Gaze Naturale "ROMGAZ"
SA
Headquarters Media , 4 Constantin I. Motas Square,
code 551130, Sibiu County
Telephone/fax number 0040 374 401020 / 0040 269 846901
Web/E-mail www.romgaz.ro / secretariat@romgaz.ro
Registration No. with J32/392/2001
the Trade Register Office
Fiscal Code RO 14056826
Legal Entity Identifier 2549009R7KJ38D9RW354
(LEI)
Regulated market where Bucharest Stock Exchange (shares) and
the company's shares are London Stock Exchange (GDRs)
traded
Subscribed and paid in RON 385,422,400
share capital
Shares main characteristics 385,422,400 shares each with a nominal
value of RON 1
nominative, ordinary, indivisible shares,
issued dematerialised and free tradable
since November 12, 2013 as SNG - for shares
and SNGR - for GDRs
ROMGAZ GROUP[1] PERFORMANCES
Romgaz Group keeps high operational and financial performances
in the first six months of 2022.
National gas consumption recorded a decrease of roughly 13.3%
for the first 6 months of 2022 as compared to the similar period of
last year, while Romgaz deliveries decreased by 6.7%. Therefore,
Romgaz has a 61.44% market share in terms of deliveries from
internal production, by 10.5% higher than the share held in the
similar period of 2021.
Natural gas production for first half of 2022, was 2,515.1
million m(3) , indicating an insignificant production decline
(0.16%) related to the production recorded in H1 2021.
Romgaz electricity production reached 544.66 GWh, higher by
341.58 GWh than the production in the similar period of 2021
(+168.2%). This production placed Romgaz at a market share of 1.95%
([2]) .
Consolidated net profit per share (EPS) was RON 4.5.
Margins of main profitability indicators for H1 2022: net
consolidated profit (23.02%), consolidated EBIT (26.19%) and
consolidated EBITDA (29.12%) are slightly decreasing as compared to
the first half of 2021 (33.9%; 38.9% and 52.7% respectively) as a
consequence of higher taxes and fees paid by the Group, but
maintain a high rate.
Relevant Financial Result s (consolidated)
* RON million *
Q2 2021 Q1 2022 Q2 2022 <DELTA> Main indicators HI 2021 HI 2022 <DELTA>
Q2 (%) HI (%)
922.8 3,925.8 3,570.3 286.90 Revenue 2,250.0 7,496.0 233.15
-------- -------- -------- ------------------------- -------- -------- --------
1,002.1 3,924.4 3,680.1 267.24 Income 2,258.2 7,604.5 236.75
-------- -------- -------- ------------------------- -------- -------- --------
662.0 2,755.0 2,792.5 321.82 Expenses 1,355.5 5,547.5 309.27
-------- -------- -------- ------------------------- -------- -------- --------
Share of the associates'
(0.6) (0.1) 0.3 n/a result (0.8) 0.2 n/a
-------- -------- -------- ------------------------- -------- -------- --------
339.6 1,169.4 887.9 161.50 Gross Profit 901.9 2,057.3 128.10
-------- -------- -------- ------------------------- -------- -------- --------
41.7 189.7 141.6 239.51 Profit Tax 140.3 331.3 136.11
-------- -------- -------- ------------------------- -------- -------- --------
297.8 979.6 746.3 150.57 Net Profit 761.6 1,725.9 126.62
-------- -------- -------- ------------------------- -------- -------- --------
326.8 1,137.5 825.7 152.66 EBIT 875.4 1,963.2 124.27
-------- -------- -------- ------------------------- -------- -------- --------
489.9 1,226.5 956.2 95.16 EBITDA 1,185.7 2,182.7 84.09
-------- -------- -------- ------------------------- -------- -------- --------
Earnings per share
0.8 2.5 1.9 150.57 (RON) 2.0 4.5 126.62
-------- -------- -------- ------------------------- -------- -------- --------
Net Profit Rate
32.27 24.95 20.90 -35.22 (% from Revenue) 33.85 23.02 -31.98
-------- -------- -------- ------------------------- -------- -------- --------
EBIT ratio (% from
35.41 28.97 23.13 -34.69 Revenue) 38.90 26.19 -32.68
-------- -------- -------- ------------------------- -------- -------- --------
EBITDA ratio (%
53.09 31.24 26.78 -49.56 from Revenue) 52.70 29.12 -44.74
-------- -------- -------- ------------------------- -------- -------- --------
Number of employees
at the end of the
6,066 5,843 5,884 -3.00 period 6,066 5,884 -3.00
-------- -------- -------- ------------------------- -------- -------- --------
The figures above are rounded. Therefore, small differences may
result upon reconciliation.
Note: income and expenses do not include in-house works
capitalized as non-current assets.
Summary of the Group's main indicators for 1(st) half year 2022
(HI 2022):
ü Total income is by RON 5,346.29 million higher, recording a
236.75% rise. The largest contribution is represented by the
revenue from gas sales (RON 6,683.05 million in H1 2022 as compared
to RON 1,965.74 million in H1 2021). Another significant
contribution to the increase of income is the revenue from
electricity sales (RON 498.58 million in H1 2022 as compared to RON
42.75 million in H1 2021);
ü Total Expenses increased in H1 2022 by 309.27% mainly due to
higher royalty expenses (+ RON 734.01 million) and to the windfall
tax (+ RON 3,457.16 million). A new windfall tax was introduced in
Q2 2022, related to electricity sales, the amount of such windfall
tax was RON 62.84 million;
ü Net consolidated profit of RON 1,725.95 million, by 126.62%
higher, namely RON 964.34 million, as compared to the similar
period of last year;
ü Labour productivity increased as compared to the previous
period, from RON 370.92 thousand revenue/employee in H1 2021 to
1,273.97 thousand revenue/employee in H1 2022 (+246,46%);
ü EPS of RON 4.5 is by 126.62% higher than recorded in H1
2021.
Romgaz signed in May 2022 the agreement for the acquisition of
all shares issued by (representing 100% from the share capital of)
ExxonMobil Exploration and Production Romania Limited (EMEPRL)
which holds 50% of the acquired rights and obligations under the
Petroleum Agreement for the eastern area, deep water zone of Neptun
XIX offshore Block in the Black Sea.
The agreed transaction price is USD 1.6 bln. The acquisition
price may be adjusted under certain conditions, subject to
contractual provisions.
Upon signing, Romgaz had to pay an advance/deposit of USD 106
million.
Also in May, Romgaz signed a financing agreement of EUR 325
million with Raiffeisen Bank, for partially financing the
acquisition of EMEPRL shares. In June, Romgaz signed an addendum to
the financing agreement providing that the EUR 325 million loan is
granted by Raiffeisen Bank and Banca Comerciala Romana.
Operational Results
Q2 2021 Q1 2022 Q2 2022 <DELTA> Main Indicators HI 2021 HI 2022 <DELTA>
Q2 (%) HI
(%)
Gas production
1,207.7 1,307.2 1,207.9 0.02 (million m(3) ) 2,519.2 2,515.1 -0.2
-------- -------- -------- ------------------------ -------- -------- --------
Petroleum royalty
84.1 92.6 83.8 -9.5 (million m(3) ) 176.9 176.5 -0.2
-------- -------- -------- ------------------------ -------- -------- --------
Condensate production
6,515 5,369 5,239 -19.6 (tons) 12,865 10,607 -17.6
-------- -------- -------- ------------------------ -------- -------- --------
Electricity production
1.0 345.3 199.3 19,637 (GWh) 203.1 544.7 168.2
-------- -------- -------- ------------------------ -------- -------- --------
Invoiced UGS withdrawal
services (million
130.8 1,026.4 63.7 -51.3 m(3) ) 1,420.7 1,090.1 -23.3
-------- -------- -------- ------------------------ -------- -------- --------
Invoiced UGS injection
services (million
556.6 78.8 702.2 10.8 m(3) ) 559.0 781.0 39.7
-------- -------- -------- ------------------------ -------- -------- --------
Note: the information is not consolidated, namely it contains
transactions between Romgaz and Depogaz.
H1 2022 high natural gas production was supported by:
ü optimisation of gas field exploitation;
ü ongoing rehabilitation projects of main mature gas fields;
ü well workover operations at wells with low productivity or
inactive wells;
ü investments to expand productive infrastructure and to connect
new wells to it.
National gas consumption estimated for H1 2022 was 63.35 TWh,
approximately 13.3% lower than the consumption recorded in H1 2021,
out of which 18.27 TWh is import gas and the difference of 45.08
TWh is gas from domestic production, Romgaz deliveries being 27.56
TWh, representing 43.35 % of the national consumption and 61.44% of
the consumption covered with gas from domestic production.
Electricity production is shown in the table below and its trend
was closely related to the energy demand, price trends on
competitive markets and equipment maintenance and repair
activities.
*MWh*
2021 2022 Variation
1 2 3 4=(3-2)/2x100
-------- -------- --------------
Q 1 202,073 345,337 70.90%
-------- -------- --------------
Q 2 1,010 199,323 19,634.95%
-------- -------- --------------
HI 203,083 544,660 168.20%
-------- -------- --------------
The full version of the Board of Directors' Report for 1(ST)
Half Year 2022, the Consolidated Condensed Interim Financial
Statements (not audited) for the six-month and three-month periods
ended June 30, 2022 and the Separate Condensed Interim Financial
Statements (not audited) for the six-month period ended June 30,
2022, prepared in accordance with International Accounting Standard
34, are available on company's website www.romgaz.ro - Section
Investors - Interim Reports and on RNS website at:
http://www.rns-pdf.londonstockexchange.com/rns/7760V_1-2022-8-11.pdf
[1] Romgaz Group consists of S.N.G.N. Romgaz S.A. ("the
Company"/"Romgaz") as parent company, Filiala de Inmagazinare Gaze
Naturale Depogaz Ploiesti SRL ("Depogaz"), which is the subsidiary
owned 100% by Romgaz, and its associates S.C. Depomures S.A. (40%
of the share capital) and S.C. Agri LNG Project Company SRL (25% of
the share capital)
[2] Source: CNTEE Transelectrica SA
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END
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