PGNiG earnings surge in Q1 on higher prices
Core earnings (Ebitda) at Polish gas supplier PGNiG climbed 63% year/year in the first quarter to 3.39bn zlotys ($913mn) on the back of increased oil and gas prices, the company said on May 20.
PGNiG's upstream business accounted for 40% of Ebitda, while distribution contributed 30%, trade and storage 15% and generation 14%. Net profit shot up 124% yr/yr, arriving at 1.75bn zlotys.
"The PGNiG group continues its winning streak in terms of both financial and operating performance. Growing hydrocarbon prices supported solid results delivered by the exploration and production segment," company president Pawel Majewski said. "Low temperatures and the related increase in demand for gas used for heating led to higher gas sales and distribution volumes in the trade and storage and distribution segments. The weather also contributed to higher heat production and sales volumes in the generation segment."
PGNiG's upstream operations deliver an 18-fold growth in Ebitda to 1.35bn zlotys, lifted by a 41% growth in revenues to 1.79bn zlotys. "One of the drivers of the major improvement in performance was rising hydrocarbon prices – the arithmetic mean of gas prices on the day-ahead market of the Polish power exchange in the first quarter rose 79% yr/yr," the company explained. Oil prices were up 20% yr/yr at $60.7/barrel.
The company also expanded gas output to 1.24bn m3, from 1.16bn m3, while oil production was broadly flat at 328,000 metric tons. Ebitda from trade and storage slumped 46% yr/yr to 0.49bn zlotys, as expenses grew because of higher prices and the company took a loss on hedging instruments. Distribution earnings were up 31% at 1.01bn zlotys, while earnings from generation rose 11% to 0.46bn zlotys, as low temperatures led to higher demand for gas and heat.