MOL Posts Highest Profit in Decade in 2017
MOL Group announced its financial results for 2017. MOL increased its EBITDA by 14% comfortably outperforming its 2017 target on the back of a strong financial and operational delivery of all business segments.
Organic capex stood at USD 1.04 bln, in line with lowered guidance and slightly higher than in the previous year. MOL continued to generate a massive amount of free cash flow establishing a strong financial framework to cover its ambitious transformational projects.
Upstream delivered USD 854 mn EBITDA, a 26% increase in comparison with 2016 arising from higher Brent and gas prices. Due to a strong cost discipline the segment nearly doubled the amount of free cash flow, USD 14 per each barrel produced, and turned into a major contributor to the Group’s cash generation in 2017.
The daily production averaged at 107,400 barrels of oil equivalent, slightly below the yearly guidance due to lower UK contribution.
Downstream once again posted strong results and remained the main earnings contributor delivering almost half of the Group’s Clean CCS EBITDA at USD 1.18 bn. The segment increased its contribution by 2% from an already very high base thanks to internal efficiency programs and the still supportive external environment.
Gas Midstream EBITDA rose 15% year-on-year to reach USD 223 mn, strongly supported by surging domestic transmission volumes, which were able to compensate for adverse tariff changes.
Zsolt Hernádi, MOL Group Chairman-CEO, commented on the results: "I am glad to say that 2017 was another year of delivering strong financial results, but equally importantly it was also a year of visible progress along our transformation journey set out in the MOL 2030 strategy. We comfortably beat our upgraded earnings targets with increasing contribution from all businesses."
"Upstream more than doubled its free cash flow contribution, Downstream EBITDA increased further from a high base, while Consumer Services sustained its double-digit earnings growth. Regarding strategic transformation, our flagship chemicals (polyol) project made major progress and we have been launching new, innovative mobility-related services," he added.
"We are starting 2018 with a strong momentum with crucial investment decisions ahead of us. We are also expecting to deliver around USD 2.2bn EBITDA this year, which will allow us to fund our transformational projects as well as the rising dividends to our shareholders," Zsolt concluded.
