Croatian oil company INA recorded a net profit in the amount of 146 million euros in the first nine months of 2021, compared to a net loss of 141 million euros in the same period last year.
EBITDA of INA Group for the first nine months of 2021 amounted to 308 million euros. Exploration and Production business is the main contributor to the results with EBITDA of over 214 million euros, which represents an increase driven by improved average realized hydrocarbon price level of 58 dollars/barrel. Still, natural production decline continues across the asset base. Refining and Marketing including Consumer services and Retail results reached 134 million euros on the back of a better than expected tourist season.
Investment activities increased throughout the businesses compared to the first nine months of 2020. The Rijeka refinery upgrade remains the major strategic investment, aimed at improving the long-term competitive position of the refining business. At the same time building a profitable Egyptian Exploration and Production portfolio continues with exploration and development activities expected in the newly acquired Block 10 share. Financial position with net debt of some 220 million euros and net gearing of 13.5% enables INA Group to continue the ongoing intensive investment cycle.
President of INA’s Managemnet Board Sandor Fasimon said that, following the unseen market turmoil during 2020, this year shows a more favorable environment but the disturbances in the world economy continue. Oil and gas prices not just recovered, but the sudden spike in demand pushed them well above expected levels, with Brent exceeding 70 dollars during Q3 2021 and further growing in Q4. Such an environment increased INA Group revenue to more than 2.14 billion euros. This spike in prices is the primary driver behind the strong results, especially in the Exploration & Production business, once again the biggest cash generator. Still, the company needs to be aware that this relief is externally driven, and the continued natural decline remains a challenge. To address this challenge INA will try to maximize its Croatian portfolio, onshore but also offshore, with a new drilling campaign aimed at increasing gas production.
Refining sales improved at captive markets, while retail sales recorded a 14 % recovery compared to the first nine months of 2020, which were mostly marked by the pandemic. This is the result of better than expected tourist season that also lasted longer, visible in both fuel and non-fuel part. Refining margins, although currently showing signs of recovery, remain a major factor affecting profitability of the business and represent a risk for the future market outlook.
Capital investments during the first nine months of 2021 increased by 20 %, with roughly half spent in the Refining business.
