MOL's Earnings Sink in 2019
Hungary's MOL suffered weaker earnings from both downstream and upstream operations in 2019 as a result of lower prices for almost all its products, according to company results published on February 21.
Earnings based on clean current cost of supply (CCS) came to $2.44bn, down 9% year on year (yr/yr), while revenues were down 5% at $18.1bn. MOL's upstream business saw a 19% reduction in earnings to $1.07bn, while its downstream segment experienced a 28.7% decline to $771mn. Earnings from its gas midstream operations were relatively unchanged at $187mn.
“We delivered robust financial results in 2019, even slightly ahead of our upgraded pre-tax earnings (Ebitda) guidance despite a weaker external environment," MOL CEO Zsolt Hernadi said. "With our strong foundations and despite increasing global uncertainties, we look forward to 2020 with optimism."
MOL expects its clean CCS Ebitda to total between $2.4 and $2.6bn in 2020, gradually rising to $2.8-3.0bn by 2023, based on its macro outlook. Production is seen rising from 110,000 barrels of oil equivalent/day to 120-130,000 boe/day by 2023.
Both earnings and production will benefit from MOL's $1.6bn acquisition of Chevron's 9.57% stake in the BP-operated Azeri-Chirag-Gunashli (ACG) project off Azerbaijan, announced in November. Capital expenditure is expected at $1.9-2.1bn in 2020, down from $2.24bn in 2019.