OREANDA-NEWS. PAO SIBUR Holding, an integrated gas processing and petrochemicals company, today published its operational and financial results for the nine months ended 30 September 2014 in accordance with International Financial Reporting Standards (IFRS).

Operational highlights

  • Associated petroleum gas (APG) processing volumes increased by 6.1% year-on-year
  • Raw natural gas liquids (raw NGL) fractionation volumes increased by 16.4% year-on-year
  • Basic polymers production increased by 60% year-on-year following the launch of Tobolsk-Polymer Plant

Financial highlights

  • Revenue increased by 33.5% year-on-year
  • Revenue from sales of energy products increased by 58.4% year-on-year
  • Revenue from sales of basic polymers increased by 57.4% year-on-year
  • Revenue from sales of synthetic rubbers decreased by 19.2% year-on-year
  • EBITDA increased by 28.3% year-on-year
  • Adjusted profit(i) increased by 31.4% year-on-year

Operational Results

In the nine months ended 30 September 2014, SIBUR’s gas processing plants (GPPs) processed 15.4 billion cubic metres of APG, an increase of 6.1% year-on-year. As a result, production of natural gas rose by 6.5% year-on-year to 13.3 billion cubic metres. Raw NGL fractionation volumes increased by 16.4% year-on-year to 4.5 million tonnes.

SIBUR increased sales volumes of the majority of its energy products primarily due to substantial expansion of trading activities for naphtha following the launch of Ust-Luga transshipment facility. Natural gas sales volumes increased by 28.7% year-on-year to 11.5 billion cubic metres. External sales of NGLs, including liquefied petroleum gases (LPG), naphtha and raw NGL, rose by 39% year-on-year to 4.9 million tonnes. Sales volumes of petrochemical products totaled 1.6 million tonnes, a decrease of 1% year-on-year.

Operating results

Tonnes,
except as stated 		Nine months ended 30 September Change
%
2014 2013
Processing and production volumes
APG processing (thousand cubic metres) 15,354,104 14,476,887 6.1%
Natural gas production (thousand cubic metres) 13,298,362 12,492,508 6.5%
Raw NGL fractionation 4,533,876 3,895,248 16.4%
Basic polymers production 438,832 275,076 59.5%
Synthetic rubbers production 263,199 304,983 (13.7%)
Plastics and organic synthesis production 645,220 638,255 1.1%
Intermediates and other chemicals production 2,983,278 3,120,343 (4.4%)
Sales volumes
Natural gas sales volumes (thousand cubic metres) 11,491,642 8,929,111 28.7%
NGLs sales volumes 4,866,964 3,501,430 39.0%
MTBE, other fuels & fuel additives sales volumes 448,127 482,327 (7.1%)
Petrochemical products sales volumes 1,591,136 1,607,021 (1.0%)

Financial Results

In the nine months ended 30 September 2014, we delivered strong results. This was largely attributable to the completion of large-scale projects on construction of integrated transportation infrastructure, processing capacities, as well as polymers production. The completion of the Purovsk–Pyt-Yakh–Tobolsk pipeline construction provides SIBUR with an access to the additional available volumes of raw NGL, and the expanded fractionation capacity in Tobolsk enabled us to increase production volumes of energy products. We also increased production and sales of basic polymers following the launch of Tobolsk-Polymer Plant.

Our revenue increased by 33.5% to RR 263,852 million compared to RR 197,598 million in the nine months of 2013. Our revenue from sales of energy products increased by 58.4% year-on-year to RR 163,457 million from RR 103,169 million in the corresponding period of 2013. The solid performance of our energy product group was primarily attributable to higher sales volumes on expanded trading activities following the launch of the Ust-Luga transshipment facility in the end of 2013 and higher LPG and naphtha production following the launch of the transportation and fractionation capacities. Our revenue from sales of basic polymers increased by 57.4% year-on-year to RR 26,135 million from RR 16,605 million in the nine months ended 30 September 2013. The increase was largely attributable to higher PP sales volumes following the launch of Tobolsk-Polymer plant in the second half of 2013. The increase of revenue from sales of plastics and organic synthesis products was primarily attributable to higher sales volumes of PET and BOPP-films. Our synthetic rubber business remained under significant pressure on the back of persistently negative market environment for our synthetic rubber grades resulting in a decrease of revenue by 19.2% year-on-year to RR 20,124 million from RR 24,908 million in the corresponding period of 2013. Our revenue from sales of petrochemical products increased by 6.1% year-on-year to RR 92,850 million from RR 87,491 million a year earlier.

Our EBITDA for the period amounted to RR 73,140 million, a year-on-year growth of 28.3% from RR 56,985 million in the nine months of 2013. This was largely attributable to the completion of large-scale investment projects.

In the nine months ended 30 September 2014, our adjusted profit(i) decreased by 31.4% year-on-year to RR 24,778 million from RR 36,124 million a year earlier. This was negatively affected by the substantial Russian rouble depreciation that resulted in net foreign exchange loss in the amount of RR 20,263 million.

Our profit increased by 97.2% year-on-year to RR 67,857 million from RR 34,410 million in the nine months of 2013. The increase was largely attributable to a non-cash gain on acquisition of a 49% stake in OOO Yugragazpererabotka related to the revaluation of SIBUR’s share in the JV accounted for at historical cost before the transaction. This was partially offset by a non-cash charge related to the equity-settled share-based payment plans granted to the Group’s former and current directors and key management in July 2013, and a non-cash gain on deconsolidation of OOO Yugragazpererabotka in the first half of 2013.

In the nine months ended 30 September 2014, our capital expenditures decreased by 6.3% to RR 49,293 million from RR 52,605 million a year earlier, as we completed several large-scale projects in 2013 and early 2014.

Financial results


RR millions, except as stated 		Nine months ended 30 September Change
%
2014 2013
Revenue (net of VAT and export duties) 263,852 197,598 33.5%
Energy products 163,457 103,169 58.4%
Petrochemical products 92,850 87,491 6.1%
Other 7,545 6,938 8.7%
EBITDA 73,140 56,985 28.3%
EBITDA margin, % 27.7% 28.8%  
Profit for the reporting period 67,857 34,410 97.2%
Adjusted profit(i) 24,778 36,124 (31.4%)
Operating cash flows before working capital changes 73,561 56,780 29.6%
Net cash used in investing activities, including (76,182) (55,568) 37.1%
Capital expenditures (49,293) (52,605) (6.3%)

Borrowings

As of 30 September 2014, our total debt amounted to RR 144,939 million, an increase of 12.1% from RR 129,247 million as of 30 June 2014. The portion of long-term debt increased to 75.0% from 62.4% as of 30 June 2014.

Our net debt(ii) increased by 15.8% to RR 132,571 million as of 30 September 2014 from RR 114,466 million as of 30 June 2014. Our net debt to EBITDA ratio was 1.40x compared to 1.27x as of 30 June 2014 demonstrating the company’s strong financial position.

Borrowings

RR millions,
except as stated 		As of
30 September 2014 		As of
30 June 2014 		As of
31 December 2013 		Changе, %
vs 30 June 2014 		Change, %
vs 31 Dec 2013
Total debt 144,939 129,247 100,474 12.1% 44.3%
Cash and cash equivalents 12,368 14,781 7,948 (16.3%) 55.6%
Net debt(iv) 132,571 114,466 92,526 15.8% 43.3%
Key ratio
Debt / EBITDA 1.53x 1.43x 1.27x  
Net debt(iv)/ EBITDA 1.40x 1.27x 1.17x  

Borrowings by scheduledmaturities

RR millions,
except as stated 		As of 30
September 2014 		% of total
borrowings 		As of 30
June 2014 		% of total
borrowings 		As of 31
Dec 2013 		% of total
borrowings 		Change, %
vs 31 Dec 2013
Due for repayment:
Within one year 36,307 25.0% 48,570 37.6% 42,743 42.5% (15.1)%
Between one and
two years 		35,313 24.4% 30,496 23.6% 6,344 6.3% 456.6%
Between two and
five years 		64,364 44.4% 41,547 32.1% 42,454 42.3% 51.6%
After five years 8,955 6.2% 8,634 6.7% 8,933 8.9% 0.2%
Total debt 144,939 100.0% 129,2472 100.0% 100,474 100.0% 44.3%

About SIBUR

SIBUR is a uniquely positioned vertically integrated gas processing and petrochemicals company. SIBUR owns and operates Russia’s largest gas processing business in terms of associated petroleum gas processing volumes, and is a leader in the Russian petrochemicals industry.

As of 30 September 2014, SIBUR operated 26 production sites located all over Russia, had over 1,400 major customers engaged in the energy, automotive, construction, fast moving consumer goods (FMCG), chemical and other industries in approximately 70 countries worldwide and employed over 26,000 personnel.