Eni. Marco Mangiagalli

Transcription

1 Eni 2007 First Quarter Results Marco Mangiagalli CFO May 11 th, 2007

2 Disclaimer This presentation contains forward-looking statements regarding future events and the future results of Eni that are based on current expectations, estimates, forecasts, and projections about the industries in which Eni operates and the beliefs and assumptions of the management of Eni. In particular, among other statements, certain statements with regard to management objectives, trends in results of operations, margins, costs, return on equity, risk management and competition are forward-looking in nature. Words such as expects, anticipates, targets, goals, projects, intends, plans, believes, seeks, estimates, variations of such words, and similar expressions are intended to identify such forward-looking statements. These forward-looking statements are only predictions and are subject to risks, uncertainties, and assumptions that are difficult to predict because they relate to events and depend on circumstances that will occur in the future. Therefore, Eni s actual results may differ materially and adversely from those expressed or implied in any forward-looking statements. Factors that might cause or contribute to such differences include, but are not limited to, economic conditions globally, the impact of competition, political and economic developments in the countries in which Eni operates, regulatory developments in Italy and internationally and changes in oil prices and in the margins for Eni products. Any forward-looking statements made by or on behalf of Eni speak only as of the date they are made. Eni does not undertake to update forward-looking statements to reflect any changes in Eni s expectations with regard thereto or any changes in events, conditions or circumstances on which any such statement is based. The reader should, however, consult any further disclosures Eni may make in documents it files with the US Securities and Exchange Commission. 2

3 Market Environment Brent Average European Refining Margin* /$ Exchange Rate $/boe /boe $/boe /boe Q106 Q206 Q306 Q406 Q ,5 6 5,5 5 4,5 4 3,5 3 2,5 2 1,5 1 Q106 Q206 Q306 Q406 Q ,5 6 5,5 5 4,5 4 3,5 3 2,5 2 1,5 1 1,4 1,3 1,2 1,1 Q106 Q206 Q306 Q406 Q107 Δ% Q1 07/Q1 06 Δ% Q1 07/Q1 06 Δ% Q1 07/Q1 06 $/boe /boe -6.5% -14.2% $/boe /boe +3.7% -4.5% /$ +9.0% * FOB Mediterranean market, lead free gasoline. Eni calculations on Platt s Oilgram data 3

4 Consolidated Results: Net Profit REPORTED Million ADJUSTED* -13.0% -9.3% 2,974 2,588 2,954 2,680 * Excluding special items and gains (losses) on inventory 4

5 Consolidated Results: Operating Profit REPORTED Million ADJUSTED* +4% Net of: -8.8% -5.1% -250 mln mild weather 5,595 5,105 5,533 5, mln /$ appreciation -60 mln prices scenario** * Excluding special items and gains (losses) on inventory ** Brent, TRC Brent refining margin and Petrochemical margins. 5

6 E&P: Production Trend 1800 kboe/d % -5.5% Excluding PSA effect -0.8% Excluding Venezuela (-60) and Nigeria (-27) ,827 1, Brent $/bl Q1 06 Q Reported PSA effect 1$/bl: ~ 2 kboe/d Full year production ~1.77 million ~ 55$/boe 6

7 E&P: Operating Profit REPORTED Million ADJUSTED* -27.3% -26.3% 4,308 4,251 HIGHLIGHTS 3,132 3,132 Lower volume sold Weaker oil prices /$ appreciation Higher opex and DD&A Higher exploration expenses Special items & inventory valuation Gains on assets disposal 57 No special items * Excluding special items and gains (losses) on inventory 7

8 G&P: Natural Gas Volume Sold Bcm ITALY % 16.8 Italian gas demand Q1 07/ Q1 06: -12% Eni sales (including self consumption) -7.2% INTERNATIONAL Associates Consolidated Overall natural gas sales Q1 07/Q % 8

9 G&P: Operating Profit REPORTED Million ADJUSTED* +36.9% 1, % 1,683 1,199 1,203 Special items & inventory valuation Inventory gains 30 Provisions for environmental laws (20) Redundancy incentives (14) Inventory losses (40) Redundancy incentives (2) * Excluding special items and gains (losses) on inventory 9

10 G&P: Ebitda Proforma Adjusted +30% 1,902 (Million ) 252 International Transportation HIGHLIGHTS 1, Regulated 88 Powergen Improved regulatory framework 479 /$ appreciation Mild weather condition 71 1,150 Supply & Marketing 665 * Ebitda pro forma includes: 50% SRG ebitda and pro-quota ebitda contribution from associates 10

11 R&M: Operating Profit REPORTED Million ADJUSTED* HIGHLIGHTS Lower maintenance activity Higher refining throughput /$ appreciation Lower contribution from marketing activities in Italy % +34.8% (10) Inventory gain 47 Provisions for environmental laws (44) Redundancy incentives (5) Others 2 Special items & inventory valuation Inventory loss (112) Provisions for environmental laws (17) Redundancy incentives (1) * Excluding special items and gains (losses) on inventory 11

12 Other Businesses: Adjusted Operating Profit Million Q Q Δ % Petrochemicals Oilfield services & engineering Other activities (63) (50) 21 Corporate (46) (35) 24 12

13 Sources and Uses of Cash SOURCES AND USES OF CASH Bn NET FINANCIAL DEBT Divestments Cash Flow from operations December 2006 March 2007 Capex Buy Back Others Net debt to equity 13

14 Capex Million 50.2% 2, Other E&OS R&M G&P 36 1, ,366 E&P

15 Recent Acquisitions: Strategic Rationale Enter hydrocarbon rich regions and strengthen presence in core areas E&P Boost growth in the four year plan and beyond CAGR: 4% Add valuable resources: over 2 billion boe Operatorship Exploration potential R&M Improve integration with local refining capacity Strengthen existing marketing network 15

16 New Gulf of Mexico Assets Cash consideration US$ 4,757 Increase materiality in a key area: 222 million boe 2P reserves From 36 to over 110 kboe/d (effective July 1 st 2007) Strengthen operatorship in the Gulf of Mexico High exploration potential EPS and CFPS accretive from 2007 Miocene New Orleans Neptune Rigel Main Pass 272 Blocks ~ 60% operated 0.78 Million Net Acres Legacy Fields Egom 53 Fields 70% of 2P reserves Front Runner Devil Tower Thunderhawk in 8 fields Dominion assets Production Exploration Core Areas Shelf/State Deepwater 16

17 Ex Yukos Assets Industrial Rationale Strategic partnership with Gazprom SINT Assets Gazprom Neft (key areas) Significant breakthrough in Russian upstream Access to significant reserves Sustain production growth in the long term Leverage on operational skills and technology Moscow Omsk Noyabsk Khanty Mansyisk 17

18 Other E&P Recent acquisitions Congo Alaska Angola Original Oil in place ~ 1.4 Gbl Nikaitchuq TAPS Operated activities 2P reserves: 126 Mboe Double digit production growth M Boundi first quarter 07 proforma production: 23,000 bopd * Operatorship and 70% stake in the Nikaitchuq field 2P reserves: 70 Mboe First oil % stake in A-LNG New 5 million-ton LNG plant Monetize currently untapped reserves * Production not accounted 18

19 Acquisition of Downstream Marketing Activities Transaction Terms Closing expected in 3Q2007 Subject to anti-trust authorities authorization Industrial Rationale Increase integration with local refining capacity Strengthen existing marketing network: 102 retail station acquired Improve network quality: 4.9 mln lt/y throughput per site Enhance products porfolio: Lubricants sales more than doubled and business avio acquired Financial Impact Synergies Double digit return 19

20 Appendix 20

21 Results of Operations Q4 06 Million Q1 06 Q1 07 Δ % 21,416 Net sales from operations 23,584 21,913 (7.1) 3,957 Operating Profit 5,595 5,105 (8.8) (341) Inventory holding gains (losses) 94 (155) 4,298 Replacement Cost Operating Profit 5,501 5,260 (4.4) (478) Special items (32) 7 4,776 Adjusted Operating Profit 5,533 5,253 (5.1) 52 Net financial income (expense) 42 (133) 157 Net share of profit from associates (expense) (15.8) 4,166 Profit before income taxes 5,877 5,174 (12) (2,468) 59.2% Taxation Tax rate (2,747) 46.7% (2,431) 47% (178) Minority interest (156) (155) 1,520 Net Profit 2,974 2,588 (13) (622) (213) Special items Inventory holding gains (losses) (39) 59 5 (97) 2,355 Adjusted Net Profit 2,954 2,680 (9.3) 21

22 G&P: Adjusted Operating Profit by Activities +39.9% Million 1,683 HIGHLIGHTS 163 International Transportation 1, Snam Rete Gas Improved regulatory framework /$ appreciation Mild weather condition ,177 Powergen Marketing & Distribution (Italy-abroad) 22

23 Unrealized Profit in Stocks (UPIS) Million E&P vs R&M (32) 64 E&P vs G&P SnamProgetti vs Eni Group 1 2 Total UPIS (2)

24 Eni Share of Profit from Associates January March Equity method accounted for Gas transportation abroad EnBw (GVS) Union Fenosa Blue Stream Others Dividends Disposals Others Net income from associates

25 G&P Share of Profit from Associates Million -16.1% Marketing & Distribution 2 3 Power International transportation 25

26 Consolidated Results: EPS and CFPS EPS -12.5% -3.9% in US$ -7.6% +0.1% in US$ (Euro per share*) Adjusted Adjusted CFPS (Euro per share*) -3.7% % in US$ -1.2% +7.7% in US$ * Average shares (fully diluted): Q1 07 3,679 million Q1 06 3,726 million Cash Flow calculated as net profit+amortization & depreciation 0.67 Adjusted Adjusted 26

27 Main Operating Data Q Q1 06 Q1 07 Δ % 1,796 Hydrocarbon prod. (kboe/d) 1,827 1,734 (5.1) 159 Production sold* (million boe) (5.9) 15.7 Natural gas sales in Italy**(bcm) (11.6) 8.1 Natural gas sales in Europe*** (bcm) (7.8) 7.5 Natural gas transported on behalf of third parties in Italy (bcm) (9.2) 7.8 Power production sold (TWh) (1.6) 13.2 Refined product sales (mil.ton.) Petrochemical sales (mil.ton.) (0.5) * Including Eni s share of production of joint venture accounted for with the equity method ** Including self-consumption *** Consolidated sales 27

28 Production Growth by Geographical Area Thousands boe/d -5.1% 1, , Rest of World North Sea West Africa North Africa Italy

29 Oil & Gas Production Kboe/d -5.1% 1,827 1,734 1,827 1,734 Italy % 223 Gas % 704 Abroad Liquids -4.4% 1,580 1,511 1, % 1,030 Q1 06 Q1 07 Q1 06 Q