Q27 IFRS RESULTS MAY 3, 27 Q27 IFRS RESULTS
Alexander Ivannikov Head of Department Q27 IFRS RESULTS 2
DISCLAIMERS This presentation has been prepared by PJSC Gazprom (the Company ), and comprises the slides for a presentation to investors concerning the Company. This presentation does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any shares or other securities representing shares in the Company, nor shall it or any part of it nor the fact of its presentation or distribution form the basis of, or be relied on in connection with, any contract or investment decision. Any viewer of this presentation considering a purchase of such securities is hereby reminded that any such purchase should be made solely on the basis of the information contained in the prospectus or other offering document prepared in relation thereto and will be subject to the selling restrictions set out therein. The information in this presentation should not be treated as investment advice. Care has been taken to ensure that the facts stated in this presentation are accurate, and that the opinions expressed are fair and reasonable. However, the contents of this presentation have not been verified by the Company. Accordingly, no representation or warranty, express or implied, is made or given by or on behalf of the Company or any of its members, directors, officers or employees or any other person as to the accuracy, completeness or fairness of the information or opinions contained in or discussed at this presentation. None of the Company or any of their respective members, directors, officers or employees nor any other person accepts any liability whatsoever for any loss howsoever arising from any use of this presentation or its contents or otherwise arising in connection therewith. The information in this presentation includes forward-looking statements, such statements may also occur during the Q&A session. These forward-looking statements include all matters that are not historical facts, statements regarding the Company s intentions, beliefs or current expectations concerning, among other things, the Company s results of operations, financial condition, liquidity, prospects, growth, strategies, and the industry in which the Company operates. By their nature, forward-looking statements involve risks and uncertainties, including, without limitation, the risks and uncertainties to be set forth in the prospectus, because they relate to events and depend on circumstances that may or may not occur in the future. The Company cautions you that forward looking statements are not guarantees of future performance and that its actual results of operations, financial condition and liquidity and the development of the industry in which the Company operates may differ materially from those made in or suggested by the forwardlooking statements contained in this presentation. In addition, even if the Company s results of operations, financial condition and liquidity and the development of the industry in which the Company operates are consistent with the forward-looking statements contained in this presentation, those results or developments may not be indicative of results or developments in future periods. The information and opinions contained in this presentation are provided as at the date of this presentation and are subject to change without notice. No person is under any obligation to update or keep current the information contained herein. By attending the presentation you agree to be bound by the foregoing limitations. Q27 IFRS RESULTS 3
HIGHLIGHTS Jan. 27 Mar. 27 High quality of Gazprom s corporate governance confirmed by Moscow Exchange Progress in approaching solution of EU antitrust case S&P changed Gazprom s rating outlook from Stable to Positive Gazprom placed USD 75 mn Eurobonds. First dollardenominated issue in the last 3 years Market environment in q6 vs q7 6 4 2 USD/bbl 54.6 35.2 USD/RUB 8 74.6 67.6 58.8 56.4 6 4 2 EUR7 mn loan from Credit Agricole CIB q6 q7 q6 q7 Strong gas export volumes in q7 (+5% YoY) BRENT USD/RUB AVERAGE RATE USD/RUB AS OF THE END OF PERIOD Apr. 27 Gazprom placed GBP85 mn Eurobonds Nord Stream 2 financing agreements signed with ENGIE, OMV, Shell, Uniper and Wintershall Belarus fully paid off its overdue debt of USD 726 mn for the Russian gas supplied by Gazprom in 26 27 USD/mcm 2 87.5 5 9.3 RUB/mcm 4, 3,873 3,82 3, 2, 5, May 27 Construction of TurkStream s offshore section commenced The Board of Directors recommended to pay out RUB 8.397 per share in annual dividends (+2% YoY) q6 q7 AVERAGE GAZPROM GAS SALES PRICE IN EUROPE & OC q6 q7 AVERAGE PRICE IN RUSSIA Q27 IFRS RESULTS Source: Company data, Bloomberg, Bank of Russia website OC - Other countries: including LNG sales 4
SUMMARY OF Q7 IFRS FINANCIAL RESULTS q6 vs q7 2,,8 +4%,85 Adjustments needed for analytical purposes* +6% 2,43,5,2 9 6 3 +% 45 (8%) (27%) 333 32 (84%) 5-26 -3 2 3 4 Total net sales Adj. EBITDA Net profit Capex Operating CF FCF Net debt EBITDA adjusted for changes in impairment provisions 2 Profit for the period attributed to shareholders of PJSC Gazprom 3 Cash capital expenditures 4 Compared to Net debt as of December 3, 26 Q27 IFRS RESULTS *In order to reflect the effects of the bank deposits (reported as part of Other current and non-current assets) increase 5
EBITDA AND NET PROFIT GROWTH EBITDA Net profit +% 5 444 +37% 45 5 (8%) 4 3 249 32 328 4 3 362 245 242 +38% 333 2 2 2 Q6 2Q6 3Q6 4Q6 Q7 Q6 2Q6 3Q6 4Q6 Q7 +29% USD bn 8. +47% 7.6 USD bn 8. +7% +5% 6. 4. 6. 3.8 4.7 5.2 6. 4. 4.9 3.7 3.8 5.7 2. 2..6. Q6 2Q6 3Q6 4Q6 Q7. Q6 2Q6 3Q6 4Q6 Q7 4Q6 Gradual recovery of key financial indicators Q27 IFRS RESULTS 6
PRODUCTION Natural gas Gas condensate Crude oil bcm +2% mt mt (3%) +6% 5 3. 83.9 89. 34. 27.2 5 4 3 4.2 3.7 3.7 4.2 4..3.3 2. 2.5 2. 5 2 5 q6 2q6 3q6 4q6 q7 q6 2q6 3q6 4q6 q7 q6 2q6 3q6 4q6 q7 Electricity Heat bn kwh mn Gcal +6% (2%) 5 4 3 42.2 33.7 35.2 45.7 44.8 6 4 5.5 45.9 49.5 2 2 7.7.6 q6 2q6 3q6 4q6 q7 q6 2q6 3q6 4q6 q7 Gazprom Group s volumes produced in Russia Calculations may differ due to rounding. Q27 IFRS RESULTS 7
GAS SALES Russia Europe & OC 2 FSU bcm 75 5 25 3,873 3,739 3,677 75 34 3 RUB/mcm 3,848 3,82 4, 3, 2, 75 82, bcm 8 6 4 2 88 58 73 59 5 52 USD/mcm 78 9 2 5 67 66 5 bcm 5 5 57 5 4 6 6 USD/mcm 52 55 5 3 5 q6 2q6 3q6 4q6 q7 q6 2q6 3q6 4q6 q7 q6 2q6 3q6 4q6 q7 VOLUMES AVERAGE PRICE IN RUSSIA VOLUMES AVERAGE PRICE IN EUROPE & OC VOLUMES AVERAGE PRICE IN FSU +7% (%) (3%) 3 2 292 29 289 32 6 4 2 663 465 48 593 594 5 7 5 48 95 2 q6 2q6 3q6 4q6 q7 q6 2q6 3q6 4q6 q7 q6 2q6 3q6 4q6 q7 NET SALES TO RUSSIA 3,4 3,4 NET SALES TO EUROPE & OC NET SALES TO FSU Calculations may differ due to rounding. Net of value added tax (VAT) 2 OC - other countries: including LNG sales 3 VAT is not charged on export sales 4 Net of custom duties and excise tax on gas exports Q27 IFRS RESULTS 8
OIL AND ENERGY BUSINESS Net Sales Q6 68% Q7 62% CRUDE OIL AND GAS CONDENSATE; REFINED PRODUCTS GAS BUSINESS AND OTHER REVENUES ELECTRICITY AND HEAT 24% 8% 29% 9% Crude oil and gas condensate; refined products +29% 6 542 533 498 457 43 4 2 2 5 5 Electricity and heat +8% 59 6 48 89 86 q6 2q6 3q6 4q6 q7 q6 2q6 3q6 4q6 q7 Calculations may differ due to rounding. Net of value added tax (VAT), excise tax and custom duties. Q27 IFRS RESULTS 9
CAPITAL EXPENDITURES Cash Capex The Group s q7 Capex breakdown 3% 2% 6 +3% (7%),64 6% 26%,369 2,262 6% 37% 8 TRANSPORT 4 437 (27%) 32 PRODUCTION OF CRUDE OIL AND GAS CONDENSATE PRODUCTION, DISTRIBUTION AND STORAGE OF NATURAL GAS REFINING 24 25 26 q6 q7 ELECTRICITY AND HEAT OTHER CAPEX CapEx breakdown as provided in Management Report Q27 IFRS RESULTS
BANK DEPOSITS According to Gazprom q7 IFRS report : Key features of bank deposits 2 : Early withdrawal clause Deposit term of over 3 months Are NOT included in Сash and cash equivalents Impact of substantial increase in bank deposits: Decrease in Cash and equivalents Increase in Net Debt and Net Debt/EBITDA Reduction in Cash flows from operating activities 3 (changes in working capital) Decrease in Free cash flow 3 In q7 Gazprom substantially increased bank deposits volumes 6 4 2 32 5 86 42 27 44 53 4 472 25 26 q7 LT DEPOSITS ST DEPOSITS Increase of LT and ST bank deposits is aimed to improve the efficiency of liquidity management Source: Gazprom Q7 IFRS report, page 7 2 Reported as a part of Other current assets and Other non-current assets Q27 IFRS RESULTS 3 Affected by ST deposits
2,5 2,,5, 5 FREE CASH FLOW GENERATION Free Cash Flow -5 -, -,5-2,,96 2,3 654 -,262 39 -,64,57 22 674 237 5 24 25 26 q6 q7 -,369-437 Operating Cash Flow Cash Capital Expenditures Free Cash Flow -26-32 Q27 adjusted Free Cash Flow breakdown 2 5 Changes in bank deposits 3 - -3 478 OCF before working capital changes -328-45 Working capital and operating items changes, tax 5 OCF reported -32 Capex -26 FCF reported 328 Adjustment for increase in ST deposits 2 FCF adjusted FCF adjusted for changes in bank deposits remains positive at $.9 bn in q7 (RUB2 bn) Free Cash Flow = Net Cash from operating activities Cash Capex 2 Free Cash Flow adjusted for changes in the ST bank deposits Q27 IFRS RESULTS 2
KEY DEBT METRICS Total Debt and Net Debt 6,.6.7 x.5 Total Debt breakdown by currency 4, 2,.9.5.6,359,38 897 687 689,65 2,83,933 2,43,3 23 24 25 26 q7..5. USD 45% RUB 9% Other 3% EUR 33% NET DEBT CASH & EQUIVALENTS NET DEBT/ADJ.EBITDA LTM Q27 adjusted Net Debt structure 2 Cash & equivalents breakdown by currency 3, 2,5 2,,5, 5 2,73 Total Debt -687 Cash & equivalents.7 2,43 Net Debt reported -472-4.3,53 ST deposits LT deposits Net Debt adjusted Adj.Net Debt/Adj.EBITDA LTM x.5.5 USD 23% EUR 6% Other 8% RUB 53% Calculated using dollar values of Net debt and EBITDA 2 Net Debt adjusted for the bank deposits reported as a part of Other current and non-current assets Q27 IFRS RESULTS 3
ADDITIONAL INFORMATION Q27 IFRS RESULTS 4
RUSSIAN NATURAL GAS BALANCE Bcm Q26 Q27 Natural gas resources 23. 27.3 Domestic gas production 69.6 82.3 Other sources. including gas from Central Asia and Azerbaijan 5.7 6.3 Gas from underground storage facilities in Russia, Latvia and Europe 26.7 27.9 Decrease in gas volumes of within the gas transportation system..8 Natural gas distribution 23. 27.3 Domestic consumption 43. 48.9 including needs of the gas transportation system and underground storage facilities 8.8.5 Gas pumped into underground storage facilities..7 Gas for LNG production 3.5 4. Foreign supplies 45. 52.3 FSU supplies.3. Increase in gas volumes of within the gas transportation system..7 5 Source: Company Operating Data Q27 IFRS RESULTS 5
THANK YOU! Q27 IFRS RESULTS 6