REG - Helleniq Energy - HELLENiQ ENERGY_Annoucement 4Q/FY23 Fin. Results
29/02/2024 16:30
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RNS Number : 0359F Helleniq Energy Holdings S.A. 29 February 2024
Maroussi, 29 February 2024
Fourth Quarter / Full Year 2023 financial results
Strong profitability on increased production and exports, amid a favorable
refining environment - Total DPS of €0.90 - First wave of transformation
efforts close to completion
HELLENiQ ENERGY Holdings S.A. ("Company") announced its FY23 financial
results, with Adjusted EBITDA coming in at €1,237m and Adjusted Net Income
amounting to €606m.
Results were mainly driven by strong international industry backdrop, higher
refinery availability and increased exports, improved performance from our
international portfolio as well as higher contribution from RES.
Downstream production in FY23 was up by 13% to 14.6m MT and sales volume
reached 15.5m MT; exports accounted for 54% of total sales volume, one of the
highest on record.
FY23 Reported Net Income amounted to €478m, reflecting a negative impact
from crude and products inventory valuation following a decline of
international prices since 2022.
Considering the strong performance and outlook, the Board of Directors will
propose to the AGM the distribution of a final dividend of €0.60 per share.
This will add to the interim dividend of €0.30 per share, which has already
been distributed, resulting in a total FY23 dividend of €0.90 per share.
Using the 2023 year-end share price, the total dividend represents a higher
than 12% dividend yield.
Strategy Implementation - Vision 2025
During 2023, the Group recorded progress in all strategic areas and has
implemented significant initiatives that will deliver value upon their
completion in the coming years.
The objective in our core business, is to further enhance financial
performance and accelerate projects that profitably promote energy transition.
In this context, we are progressing projects that improve energy efficiency
and increase energy autonomy in the downstream business, aiming for both
improved economics, as well better environmental footprint. As part of the
energy transition process, we are implementing a Hydrotreated Vegetable Oil
(HVO) co-processing unit in Thessaloniki, an investment that will initiate the
substitution of a small part of the fossil fuels output. Additionally,
investments are being evaluated for the first Greek Sustainable Aviation Fuel
(SAF) production unit in Aspropyrgos, the implementation of a CO(2) capture
project in Elefsina, a project that is highly dependent upon regulatory
framework and EU/national strategy, as well as the production of green
hydrogen and synthetic fuels in Elefsina and Thessaloniki. These solutions are
of great significance, as they support the reduction of the Company's carbon
footprint and help transition the transportation fuels sector to a greener
future. Finally, the expansion of the polypropylene production plant is
already in progress, which, further to economic value increase, it reduces our
reliance on fuel sales and further improves environmental impact of our
business.
In Fuels Marketing, the continuous expansion of the international network, the
promotion of e-mobility and the ongoing improvement of our service stations,
which are key to the delivery of our value proposition to the end-consumer,
remain a key priority.
In the RES business, HELLENiQ Renewables has significantly accelerated the
expansion of its portfolio in 2023, positioning itself as a leading player in
both the Greek market and selected international markets. Specifically,
through the completion of a series of agreements in Greece, Cyprus and
Romania, it had achieved an installed capacity of 356 MW by the end of 2023,
along with projects under construction or in advanced stages of development
with a total capacity of 0.7 GW. The current pipeline has increased further to
4.3 GW, with growing aspirations for our international footprint as well. The
progress achieved to date credibly supports our claim of attaining an
operational capacity of over 1 GW by 2025 and more than 2 GW by 2030.
In the E&P business, the acquisition of 3D seismic data in three offshore
areas ("Ionian", "Block 2", "Block 10") was completed. Furthermore, the
acquisition of 2D seismic data in two offshore areas in Crete has been
finalized, with data processing currently under way. In Crete, 3D seismic
surveys are ongoing and are expected to contribute to further evaluation and
the final decisions for next steps.
The implementation of the digital transformation program is ongoing, with an
investment of €50m to date and an annualized benefit of €44m in 2023,
which is expected to exceed €50m in 2025.
Normalization of crude oil prices and refining margins in 2023
Despite the recovery of international crude oil prices during 2H23, primarily
due to the reduction of OPEC+ output, crude oil prices for FY23 normalized
compared to the particularly high average prices of 2022. Specifically, the
Brent crude averaged $83/bbl, down by 18% y-o-y. In 4Q23 the average price was
$84/bbl, 12% lower y-o-y.
The Euro strengthened against the US dollar by 3% averaging 1.08 in 2023, up
from 1.05 in 2022.
Refining margins in 2023 declined from FY22 all-time highs, but remained
strong compared to the most recent five-year cycle (2015-2019), prior to the
pandemic. They were primarily driven by demand for main products, as well as
the sanctions imposed on Russia and the geopolitical tensions in Middle East
in 4Q23. Our refineries' system benchmark margin averaged $9.8/bbl in 2023
compared to $11.8/bbl in 2022, while for 4Q23 it averaged $8.2/bbl vs
$13.3/bbl in 4Q22.
Improved demand for motor, aviation and marine fuels
Domestic market demand reached 6.6m MT in 2023, -3% y-o-y, due to a drop in
heating oil demand. Excluding heating oil, demand rose by 4%, with gasoline
and diesel consumption improving by 3% to 4.91m MT. Aviation and marine fuel
demand reached 1.45m MT (+7%) and 2.7m MT (+3%) respectively.
Balance sheet and capital expenditure
Thanks to a strong financial performance in FY23, operating cash flows
amounted to €965m, while capital expenditure reached €291m, primarily
directed to refinery maintenance and infrastructure upgrading projects, with a
smaller portion allocated to Marketing and RES. It is anticipated that total
capital expenditure for 2024 will increase, mainly due to the acceleration of
RES capacity development.
As a result of significant free cash flow generation and despite the gradual
payment of the solidarity contribution (€200m in 2023 out of a total amount
of €267m) and the distribution of dividends totaling €229m, Net Debt
decreased by €0.3bn to €1.63bn, while Gearing (Net Debt to Capital
Employed) fell to 36% compared to 42% in 2022.
Furthermore, in 2023 the refinancing of debt totaling €1.2bn was
successfully completed, improving the maturity profile, while available credit
lines as at the end of 2023 amounted to €1.1bn.
Andreas Shiamishis, Group CEO, commented on the results:
"The Group concluded 2023 as yet another successful year, with the first phase
of the Vision 2025 strategic plan almost completed and having a positive
impact in terms of operational performance and profitability. Following the
unprecedented and exceptional highs of last year, 2023 results, albeit lower
than last year, are still very good and the qualitative analysis supports an
optimism about the next few years.
Initially, a substantial portion of the 2023 profitability was driven by
improvements in the Company's operations and the execution of the strategic
transformation program and operational excellence. These are factors that are
more controllable and predictable than a volatile international commodity
environment which, nevertheless, can have a material impact on the results of
the Company. Our efforts include the strengthening of the International
Marketing business, expansion into new markets for either fuels products or
RES projects, and a substantial renewal and development of our human capital,
supporting an ongoing cultural shift across the organization.
An even more important point to note is the gradual departure from a more
extreme, if not condemning, approach towards the energy sector, with a shift
towards realism. This shift acknowledges that fossil fuels are part of the
solution and should contribute to the energy transition in a more
environmentally friendly manner. Highlighting this message is the official
conclusion, for the first time at the recent COP28, that extreme and
unfeasible solutions have a detrimental impact on the environment. They hinder
medium-term investments which would otherwise improve existing energy sector
performance in the medium term and pave the road towards the future state,
while at the same time compromising energy cost and security, particularly in
Europe.
Referring to our financial performance, 2023 strong profitability, with
Adjusted EBITDA and Adj. Net Income of €1.24bn and €0.6bn respectively,
has further solidified the Group's position and based on that, the Board of
Directors will propose to the AGM a final dividend of €0.60 per share,
resulting in a total dividend of €0.90 per share.
Moreover, alongside the positive financial results, notable progress has been
made in ESG matters, including advancements in ESG Key Performance Indicators
(KPIs), such as a reduction of over 7% in the CO(2) emission index (per
activity level), as well as an improvement in ESG ratings with increased
participation and contribution to society's needs.
In conclusion, I would like to thank our colleagues, who actively participated
in this effort, as well as the shareholders for their trust in the Company
throughout the years. I would also like to extend my appreciation to the new
shareholders who appreciated in the Group's prospects and participated in the
recent placement of 11% of the Company's shares, in an effort undertaken by
our main shareholders to expand the investor base."
Key highlights and contribution for each of the main business units in 4Q/FY
23 were:
Refining, Supply & Trading
- Refining, Supply & Trading Adjusted EBITDA came in at
€236m in 4Q23 and at €1,043m in FY23, supported by high international
refining margins, the system's overperformance and increased sales volume (+8%
in FY23) on the back of increased refineries' availability. Exports accounted
for 54% of total sales, up from 49% in FY22.
- Production came in at 16.2m MT in FY23, +14% y-o-y, while
contribution of high-value-added products in the product mix surpassed 80%.
Petrochemicals
- FY23 Adjusted EBITDA came in at €43m, lower y-o-y, on weak PP
margins.
Marketing
- Despite a 2% decline in Domestic Marketing's total sales volume
in 2023, automotive sales volume increased by 4%, with improved market shares
and higher contribution from premium products. Aviation and bunkering sales
volume rose by 2% and 1% respectively. Excluding the impact from inventory
valuation and the pricing timing on aviation fuels, profitability was broadly
stable y-o-y, with regulatory constraints on retail gross margin remaining in
place.
- International Marketing recorded higher sales volume in 4Q23 and
FY23, with profitability at slightly lower levels y-o-y on lower margins at
some markets.
Renewables
- Higher RES operating capacity (356 ÌW) led to 8% increase in
power generation in 4Q23 and by 39% in FY23, with Adjusted EBITDA coming in at
€8m and €42m (+44%) respectively.
Associate companies
- In FY23 the contribution from associate companies, which are
consolidated using the equity method, came in at €18m, lower y-o-y.
Specifically, a) Elpedison's profitability was adversely affected by the lower
availability of the Thisvi power plant, while b) DEPA's contribution was
primarily impacted by lower domestic market demand, reduced margins and
increased costs associated with securing capacity in the gas network.
HELLENiQ ENERGY Holdings S.A.
Key consolidated financial indicators for 4Q/FY 2023
(prepared in accordance with IFRS)
€ million 4Q22 4Q23 % Ä FY22 FY23 % Ä
P&L figures
Refining Sales Volumes ('000 ÌÔ) 3,685 3,956 7% 14,284 15,438 8%
Sales 3,542 3,304 -7% 14,508 12,803 -12%
EBITDA 149 147 -1% 1,717 1,053 -39%
Adjusted EBITDA (1) 465 269 -42% 1,601 1,237 -23%
Operating Profit 75 67 -11% 1,413 736 -48%
Net Income -232 13 - 890 478 -46%
Adjusted Net Income (1) 257 111 -57% 1,006 606 -40%
Balance Sheet Items
Capital Employed 4,669 4,573 -2%
Net Debt 1,942 1,627 -16%
Gearing (ND/ND+E) 42% 36% -6pps(2)
Note 1: Adjusted for inventory effects and other non-operating/one-off items,
as well as the IFRS accounting treatment of the EUAs deficit.
Note 2: pps stands for percentage points
Further information:
Investor Relations
8A Chimaras str., 151 25 Maroussi, Greece
Tel: 210-6302526, 210-6302305
Email: ir@helleniq.gr (mailto:ir@helleniq.gr)
Group Consolidated statement of financial position
As at
Note 31 December 2023 31 December 2022
Ássets
Non-current assets
Property, plant and equipment 6 3.643.045 3.639.004
Right-of-use assets 7 232.189 233.141
Intangible assets 8 333.692 518.073
Investments in associates and joint ventures 9 404.743 402.101
Deferred income tax assets 19 95.546 91.204
Investment in equity instruments 3 514 490
Derivative financial instruments 23 746 958
Loans, advances and long term assets 10 57.771 64.596
4.768.246 4.949.567
Current assets
Inventories 11 1.472.536 1.826.242
Trade and other receivables 12 880.986 866.109
Income tax receivable 29 66.148 14.792
Derivative financial instruments 23 930 5.114
Cash and cash equivalents 13 919.457 900.176
3.340.057 3.612.433
Total assets 8.108.303 8.562.000
Equity
Share capital and share premium 14 1.020.081 1.020.081
Reserves 15 291.010 297.713
Retained Earnings 1.568.384 1.341.908
Equity attributable to the owners of the parent 2.879.475 2.659.702
Non-controlling interests 66.916 67.699
Total equity 2.946.391 2.727.401
Liabilities
Non- current liabilities
Interest bearing loans and borrowings 17 1.388.010 1.433.029
Lease liabilities 18 182.335 177.745
Deferred income tax liabilities 19 174.063 202.523
Retirement benefit obligations 20 176.305 175.500
Derivative financial instruments 23 1.541 -
Provisions 21 33.835 36.117
Other non-current liabilities 22 25.348 22.662
1.981.437 2.047.576
Current liabilities
Trade and other payables 16 1.598.726 1.835.957
Derivative financial instruments 23 13.333 1.761
Income tax payable 0 285.570 432.385
Interest bearing loans and borrowings 17 1.158.495 1.409.324
Lease liabilities 18 32.220 30.372
Dividends payable 31 92.131 77.224
3.180.475 3.787.023
Total liabilities 5.161.912 5.834.599
Total equity and liabilities 8.108.303 8.562.000
Group Consolidated statement of comprehensive income
For the year ended For the three-month period ended
Note 31 December 2023 31 December 2022 31 December 2023 31 December 2022
Revenue from contracts with customers 5 12.803.061 14.508.068 3.304.010 4.189.237
Cost of sales 24 (11.474.830) (12.580.489) (3.066.811) (3.867.099)
Gross profit / (loss) 1.328.231 1.927.579 237.199 322.138
Selling and distribution expenses 24 (415.225) (393.350) (113.297) (100.638)
Administrative expenses 24 (185.877) (176.345) (53.430) (40.091)
Exploration and development expenses 25 (6.707) (26.548) (897) (1.064)
Other operating income and other gains 26 65.203 134.393 39.550 77.356
Other operating expense and other losses 26 (49.400) (53.109) (41.710) (8.580)
Operating profit / (loss) 736.225 1.412.620 67.415 249.121
Finance income 27 11.918 3.315 5.754 91
Finance expense 27 (133.944) (108.233) (36.660) (25.631)
Lease finance cost 20, 27 (9.669) (9.261) (2.644) (2.172)
Currency exchange gains / (losses) 28 (4.743) 2.499 (10.100) 21.476
Share of profit / (loss) of investments in associates and joint ventures 9 4.272 120.042 3.148 50.617
Profit / (loss) before income tax 604.059 1.420.982 26.913 293.502
Income tax (expense) / credit 29 (123.450) (526.004) (12.181) (38.506)
Profit / (loss) for the period 480.609 894.978 14.732 254.996
Profit / (loss) attributable to:
Owners of the parent 477.732 889.501 15.458 252.169
Non-controlling interests 2.877 5.477 (726) 2.827
480.609 894.978 14.732 254.996
Other comprehensive income / (loss):
Other comprehensive income / (loss) that will not be reclassified to profit or
loss (net of tax):
Actuarial gains / (losses) on defined benefit pension plans 20 (10.746) 29.709 (9.035) -
Changes in the fair value of equity instruments 15 97 14 107 (21)
(10.649) 29.723 (8.928) (21)
Other comprehensive income / (loss) that may be reclassified subsequently to
profit or loss (net of tax):
Share of other comprehensive income / (loss) of associates 15 1.460 658 759 12.323
Fair value gains / (losses) on cash flow hedges 15 6.615 5.733 (36.700) (1.393)
Recycling of (gains) / losses on hedges through comprehensive income 15 (17.725) (4.941) - -
Currency translation differences and other movements 15 (404) (278) (71) (127)
(10.054) 1.172 (36.012) 10.803
Other comprehensive income / (loss) for the period, net of tax (20.703) 30.895 (44.940) 10.782
Total comprehensive income / (loss) for the period 459.906 925.873 (30.208) 265.778
Total comprehensive income / (loss) attributable to:
Owners of the parent 457.160 920.330 (32.580) 262.927
Non-controlling interests 2.746 5.543 2.372 2.851
459.906 925.873 (30.208) 265.778
Åarnings / (losses) per share (expressed in Euro per share) 30 1,56 2,91 0,05 0,83
Group Consolidated statement of cash flows
For the year ended
Note 31 December 2023 31 December 2022
Cash flows from operating activities
Cash generated from operations 32 1.315.349 630.118
Income tax (paid) / received 29 (350.782) (6.499)
Net cash generated from/ (used in) operating activities 964.567 623.619
Cash flows from investing activities
Purchase of property, plant and equipment & intangible assets 6, 8 (291.035) (512.175)
Proceeds from disposal of property, plant and equipment & intangible 5.630 14.167
assets
Acquisition of share of associates and joint ventures (174) -
Cash and cash equivalents of acquired subsidiaries 101 3.053
Grants received 2.832 -
Interest received 27 11.918 3.315
Prepayments for right-of-use assets (2.710) (748)
Dividends received 34.980 -
Proceeds from disposal of assets held for sale - 265.516
Net cash generated from/ (used in) investing activities (238.458) (226.872)
Cash flows from financing activities
Interest paid on borrowings (128.277) (101.565)
Dividends paid to shareholders of the Company 31 (229.006) (244.983)
Dividends paid to non-controlling interests (3.707) (2.240)
Proceeds from borrowings 17 1.519.407 1.102.636
Repayments of borrowings 17 (1.816.846) (1.259.597)
Payment of lease liabilities - principal 18 (33.505) (36.522)
Payment of lease liabilities - interest 18 (9.669) (9.261)
Net cash generated from/ (used in) financing activities (701.603) (551.532)
Net increase/ (decrease) in cash and cash equivalents 24.506 (154.785)
Cash and cash equivalents at the beginning of the year 13 900.176 1.052.618
Exchange (losses) / gains on cash and cash equivalents (5.225) 2.343
Net increase / (decrease) in cash and cash equivalents 24.506 (154.785)
Cash and cash equivalents at end of the period 13 919.457 900.176
Parent Company Statement of Financial Position
As at
Note 31 December 2023 31 December 2022
Assets
Non-current assets
Property, plant and equipment 673 671
Right-of-use assets 7 9.155 10.817
Intangible assets 63 138
Investments in subsidiaries, associates and joint ventures 9 1.785.115 1.654.517
Deferred income tax assets 8.416 11.020
Investment in equity instruments - 38
Loans, advances and long term assets 10 242.249 230.243
2.045.671 1.907.444
Current assets
Trade and other receivables 12 26.101 86.159
Income tax receivables 2.625 -
Cash and cash equivalents 150.528 209.054
179.254 295.213
Total assets 2.224.925 2.202.657
Equity
Share capital and share premium 14 1.020.081 1.020.081
Reserves 15 292.638 281.104
Retained Earnings 784.155 765.156
Total equity 2.096.874 2.066.341
Liabilities
Non-current liabilities
Lease liabilities 18 6.973 9.611
Retirement benefit obligations - 7.977
Other non-current liabilities - 174
6.973 17.762
Current liabilities
Trade and other payables 24.597 36.491
Income tax payable 0 1.928 3.582
Lease liabilities 18 2.422 1.257
Dividends payable 31 92.131 77.224
121.078 118.554
Total liabilities 128.051 136.316
Total equity and liabilities 2.224.925 2.202.657
Parent Company Statement of Comprehensive Income
For the year ended For the three-month period ended
Note 31 December 2023 31 December 2022 31 December 2023 31 December 2022
Revenue from contracts with customers 39.473 38.167 15.173 8.073
Cost of sales (35.885) (34.697) (13.793) (7.338)
Gross profit / (loss) 3.588 3.470 1.380 735
Administrative expenses (7.512) (7.628) (1.386) (22)
Other operating income and other gains 26 28.043 180.131 11.000 147.287
Other operating expense and other losses 26 (27.420) (21.373) (10.814) (3.536)
Operating profit /(loss) (3.301) 154.600 180 144.464
Finance income 17.474 6.761 2.733 1.566
Finance expense - (513) 8 (2)
Lease finance cost (380) (461) (93) (89)
Currency exchange gain / (loss) 47 - (5) -
Dividend income 31 267.785 234.069 - 202.354
Profit / (loss) before income tax 281.625 394.456 2.823 348.293
Income tax (expense) / credit 29 (4.249) (3.558) (1.037) (193)
Profit / (loss) for the period 277.376 390.898 1.786 348.100
Other comprehensive income / (loss) that will not be reclassified to profit or
loss (net of tax):
Actuarial gains / (losses) on defined benefit pension plans (2.335) 917 (1.300) -
Other comprehensive income / (loss) for the year, net of tax (2.335) 917 (1.300) -
Total comprehensive income / (loss) for the period 275.041 391.815 486 348.100
Parent Company Statement of Cash flows
For the year ended
Note 31 December 2023 31 December 2022
Cash flows from operating activities
Cash generated from / (used in) operations 32 2.528 8.122
Income tax (paid) / received (4.799) -
Net cash generated from / (used in) operating activities (2.271) 8.122
Cash flows from investing activities
Purchase of property, plant and equipment & intangible assets (24) (112)
Proceeds from disposal of property, plant and equipment & intangible - 10.960
assets
Participation in share capital increase of subsidiaries, associates and joint (132.362) (41.142)
ventures
Loans and advances to Group Companies 10 (8.500) (128.197)
Interest received 16.079 3.713
Dividends received 300.236 208.354
Net proceeds from disposal of assets held for sale - 265.516
Net cash generated from / (used in) investing activities 175.429 319.092
Cash flows from financing activities
Interest paid - (513)
Dividends paid to shareholders of the Company 31 (229.006) (244.984)
Payment of lease liabilities - principal, net 18 (2.298) (2.202)
Payment of lease liabilities - interest 18 (380) (461)
Net cash generated from / (used in) financing activities (231.684) (248.160)
Net increase / (decrease) in cash and cash equivalents (58.526) 79.054
Cash and cash equivalents at the beginning of the period 209.054 843.493
Net cash outflow due to demerger - (713.493)
Net increase / (decrease) in cash and cash equivalents (58.526) 79.054
Cash and cash equivalents at end of the period 150.528 209.054
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See all newsREG - Helleniq Energy - HELLENiQ ENERGY_Annoucement 4Q/FY23 Fin. Results
AnnouncementREG - Helleniq Energy - 3rd Quarter Results
AnnouncementREG - Helleniq Energy - Second Quarter / First Half 2023 financial results
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AnnouncementREG - Helleniq Energy - HELLENiQ ENERGH 4Q / FY 2022 financial results
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