Wintershall Dea Performs Well but Prices Hurt
German independent Wintershall DEA reported November 27 a year-on-year drop in Q3 pre-tax profits (Ebitda) of about a quarter owing to the lower Brent price (-20%) and European gas price (-60%). Ebitda was €708 ($775)mn, down from €957mn in Q3 2018.
That was despite a 6% rise in output to 613,000 barrels of oil equivalent (boe)/day and a 20% cut in unit production costs to $3.80/boe as cost savings and lower-cost production were maximised. Encouraged by the increase, the company has raised its guidance for the year from 635,000 boe/d to 640,000 boe/d. That comes with a $100mn reduction in full-year capital expenditure guidance, to $1.6bn, which is four times what it spent in Q3.
CEO Mario Mehren said the company had "made good progress" during the first full quarter since the merger and "in the face of a challenging commodity price environment," Wintershall DEA had worked hard to maximise value from its output. The business continues to generate positive free cashflow and the balance-sheet was strong, he said.