BAZAN Group Oil Refineries Ltd. 213 Results March 214 1
Disclaimer This presentation has been prepared by Oil Refineries Ltd. (the "Company") as a general presentation of the Company and its financial results. The information included in the presentation and any other information communicated by the Company while the presentation is being given (all such information as aforesaid or any part thereof the "Information") is presented for convenience purposes only. The Information does not constitute a basis for investment decision, or replace the need for carrying out independent collection of information and analysis of the Information nor does the Information purport to make or give any recommendation and/or opinion and/or to substitute for the independent judgment of any potential investor. The Company does not warrant the completeness or accuracy of the Information and it disclaims any responsibility for any damages and/or losses whatsoever resulting from the use of the Information. In case of contradiction or inconsistency between the Information and information recorded in the Company's ledgers and/or appearing in official publications, such recorded information will prevail. The Information may contain various forwardlooking statements based on current data and expectations. Actual operations, results and other data may differ materially from those stated in such forwardlooking statements, owing to various uncertainties and risks, including the risk factors referred to and discussed in the Company's financial statements and Management Discussion and Analysis as published by the Company. The Company assumes no obligation to update the said data and expectations or any other part of the Information. 2
Operating Results Highlights Improvements demonstrated in results across the Petchem and Refining sectors despite the very low benchmark refining margins Technological improvements (Hydrocracker and Natural Gas) led to a Q4 refining margin of about $5 per barrel higher than the benchmark average An action plan was implemented to improve liquidity, competitiveness and ensure stability backed by shareholders and banks In 213 the Company successfully completed significant components of its strategic plan 3
Operating Environment Crude Oil Prices Brent, $/Bbl 13 12 11 1 9 8 12/11 3/12 6/12 9/12 12/12 3/13 6/13 9/13 12/13 Trend of oil prices during 213 Security concerns in the Middle East and black sea Decrease in exports from North Africa (Libya) Futures market continue backwardation trend Ural Brent, $/Bbl 1 1 2 3 12/11 3/12 6/12 9/12 12/12 3/13 6/13 9/13 12/13 Rising trend of Ural prices vs. Brent Decrease in exports from North Africa and Iran Facility shutdown in Russia Reduction noted at quarter s end Source: REUTERS 4
Operating Environment Mediterranean Ural Cracking Margin Ural Med Margin, $/Bbl 12 9 6 3 3 6 12/11 3/12 6/12 9/12 12/12 3/13 6/13 9/13 12/13 Ural Med Margin Benchmark Margin Margins decrease due to security tensions in the Middle East and rising oil prices Reached negative levels, very rare in the refinery market Product Margins vs Brent, $/Bbl 3 2 1 1 2 מזוט סולר תחבורה בנזין 12/11 3/12 6/12 9/12 12/12 3/13 6/13 9/13 12/13 Product Margins Diesel stable over time Gasoline declined towards end Q3 (due to a reduction in travel) Fuel oil stable in accordance with crude oil prices Source: REUTERS 5
1, 9 8 7 6 5 Operating Environment Petrochemical Products Polymer Prices Above Naphtha, $/Ton Polyehylene Polypropylene Polymer Margins Remained stable with slight upward trend Higher margins than last year 4 12/11 3/12 6/12 9/12 12/12 3/13 6/13 9/13 12/13 Aromatics Prices above Gasoline, $/Ton 7 6 Paraxylene Xylene 5 4 3 2 1 12/11 3/12 6/12 9/12 12/12 3/13 6/13 9/13 12/13 Source: ICIS,PLATTS Aromatics Margins Recovery seen at year s start Margins were lower during same quarter last year due to decline in demand from the Southern Far East 6
Operating Environment Assessment of National Transportation Fuel Demand Local Consumption Transportation Fuel, KTon 6,322 6,424 + 2% 2,785 2,819 825 822 2,712 2,783 212 213 Gasoline Jet Diesel Local Consumption: Transport Fuel While European transport fuel consumption generally declined, Israel remained stable Company s transition to natural gas caused a significant decline (16%) in heating fuel consumption Source : National Infrastructure Ministry Crude Oil Refining & Petrochemicals Output, KTon 9,63 8,577 212 213 677 586 63 582 74 47 שמנים ארומטים פולימרים זיקוק Crude oil refining & petrochemical products production Increase in refining margin, including HVGO use, thanks to hydrocracker and natural gas Decrease in petrochemical products output as a result of production outages and failures 7
Fourth Quarter First and full year 213 Results ORL Refining Margin vs. Regional Benchmark ($/bbl) 4.9 5.3 5.2 4.2 4.1 2.9 3.2 2.7 3.1 1.2 1.7.3 Q4 12 Q4 13 מרווח בזן מנוטרל( מרווח ייחוס אורל Reuters ) Source: Reuters Note: Adjusted margin is ORL s refining margin calculated for comparison purposes and excludes impact of inventory w\o and gains as well as IFRS 8
213 Results P&L Account ( $ millions) 213 212 Difference Revenues 9,995 9,673 322 Cost of Sales 9,736 9,57 166 Gross Income 259 13 156 Management and sales expenses 177 177 Assets Writeoffs 18 18 Early Retirement costs 2 17 3 Operational Income 44 (91) 135 Finacing Expenses 177 169 8 Subsidiaries 1 (5) 6 Taxes (34) 66 (1) Net Profit (167) (198) 31 EBITDA 257 71 186 9
Fourth Quarter 213 Results P&L Account ( $ millions) 112/13 112/12 Difference Revenues 2,57 2,375 195 Cost of Sales 2,516 2,36 156 Gross Income 54 15 39 Management and sales expenses 47 48 (1) Assets Writeoffs 18 18 Early Retirement costs 2 17 3 Operational Income (31) (5) 37 Finacing Expenses 41 54 (13) Subsidiaries 1 1 Taxes 14 32 (18) Net Profit (58) (72) 14 EBITDA 52 2 5 1
First Nine Months 213 Results P&L Account According to Sectors ( $ millions) Operating Income (loss) Refining Polymers (CAOL) Aromatics (Gadiv) LubeOils (HBO) Trade Adjusted Consolidated Operating Income (loss) Sectors WriteOffs, Goodwill and Retirement Financing Expenses Subsidiary Income (loss) Tax Benefits Net Profit (Loss) Consolidated EBITDA 213 Reported Adjusted 56 66 31 31 29 29 (6) (6) (4) (4) 1 1 17 117 (63) (63) (177) (177) 1 1 (35) (38) (167) (16) 257 267 212 Reported Adjusted 8 54 (38) (38) 3 3 (7) (7) (9) (9) (3) (3) (46) (44) (44) (169) (169) (5) (5) 66 55 (198) (163) 71 117 11
Fourth Quarter 213 Results P&L Account According to Sectors ( $ millions) Operating Income (loss) Refining Polymers (CAOL) Aromatics (Gadiv) LubeOils (HBO) Trade Adjusted Consolidated Operating Income (loss) Sectors WriteOffs, Goodwill and Retirement Financing Expenses Subsidiary Income (loss) Tax Benefits Net Profit (Loss) Consolidated EBITDA 112/213 Reported Adjusted 7 7 4 4 7 7 (2) (2) (2) (2) 14 14 (44) (44) (42) (42) 14 14 (58) (58) 52 52 112/212 Reported Adjusted (25) (4) 6 6 (4) (4) (2) (2) (1) (1) (26) (5) (24) (24) (54) (54) 32 26 (72) (57) 2 23 12
213 Results Change in Adjusted Operating Profit ($ millions) 26 1 5 4 69 117 Operational Income 212 12 Refining Polymers Aromatics Lubes & Waxes Trade Other Operational Income 213 13
213 Results Cash Flow ($ millions) 151 55 88 12 18 45 21 187 22 174 159 147 257 Cash 1.1.13 Cash Operating Activities Bonds Issue Rights Issue Loans Swaps Retirement Loan Redemption Taxes Working Capital Bond Loans Redemption Redemption Short Term Credit Interest 116 Fixed Asset Purchases 83 Cash 31.12.13 14
213 Results Balance Sheet ($ millions) Current Assets 31.12.13 31.12.12 Cash 97 269 Account Receivable 91 85 Inventory 96 1,49 1,94 2,168 Non Current Assets Other NC assets 274 361 Property, plant & eqpmt. 2,35 2,419 Current Liabilities 31.12.13 31.12.12 Financial Obligations 826 966 Suppliers & Other Creditors Non Current Liabilities 1,483 1,656 2,39 2,622 NC fin. liabilities 1,347 1,418 Other NC fin. liabilities 88 99 2,624 2,78 1,435 1,517 Capital 4,528 4,948 Shareholder s Capital 785 89 4,528 4,948 15
Thank You 16