OREANDA-NEWS. February 01, 2010. Strong numbers as opposed to the year-end troubles in 2008. Rosneft is due to publish its 4Q09 US GAAP results on 1 February. We expect to see revenues up 35% YoY to USD 14,627mn, with EBITDA at USD 3,720mn (up from USD 12mn in 4Q08) and net income jumping 126% YoY to USD 1,749mn., reported the press-centre of VTB Capital.

Strong top line, backed by production growth at Vankor. While oil prices increased 9% QoQ in 4Q09, we expect the company’s top line to increase 12%, backed by a notable 3% QoQ pickup in production. The major driver for the significant QoQ production growth was Vankor, which boosted output 74% from 9.5mmbbl in 3Q09 to 16.6mmbbl in 4Q09.

Profitability to decline QoQ due to higher taxes. In 4Q09 we expect Rosneft to show a 25% EBITDA margin, a decline of some 3pp QoQ. We attribute this to the growth in export duties and cost inflation, which might somewhat have mitigated the effect of growing oil prices on the sector’s performance in 4Q09.

Dispute over Vankor tax breaks remains a major short-term risk. While we do not think that the 4Q09 results will surprise the market, we are now more concerned about the possible cancellation of the zero export duty for East Siberian fields. We nonetheless expect the Vankor project to demonstrate superior profitability, with or without tax breaks, in 2010.