AB Klaipėdos nafta interim unaudited financial information regarding the three months of 2020

AB Klaipėdos nafta (hereinafter – KN, the Company) announces the unaudited consolidated (hereinafter – the Group) and separate financial results for the three months ended 31 March 2020.

• Revenue for the 3 months of 2020 of the Group and the Company comprise EUR 20 million and EUR 19.8 million respectively, or 23% and 24% less compared to the same period of 2019 (EUR 26 million and EUR 26 million respectively).
• Net profit (loss) of the Group and the Company for the 3 months of 2020 amounts to EUR (0.4) million and EUR (0.3) million respectively, or 70% and 77% less compared to the first 3 months of 2019 (EUR (1.3) million and EUR (1.3) million respectively).
• EBITDA for the three months of 2020 of the Group and the Company amounts to EUR 7 million and EUR 7.1 million respectively, or 45% and 44.5% lower compared to the same period of 2019 (EUR 12.8 million and EUR 12.8 million respectively).

Main finance rations of KN comparing Q1 2020 and Q1 2019:

Management comment:

In the first quarter of 2020, the same as 2019, the Group‘s and the Company‘s net profit was significantly affected by fluctuations of exchange rate, which had negative impact by EUR 5 million in the first quarter of 2020 and by EUR 4.8 million in the same period of 2019. The unrealized impact of exchange rates arose from the 1^st January of 2019 under the requirements of IFRS 16 “Lease”, which indicated the Company to capitalize finance lease obligations and the major part of them is denominated in US dollars. Whereas all US dollar denominated lease liabilities relate to LNG terminal, the effect of unrealized exchange rate are reflected in the regulated segment. Revenue of the Group for the first quarter of 2020 compared to the same period of 2019 is lower by EUR 6 million due to the reduction of LNG security supplement from the 1^st January 2020.

LNG regasification at Klaipėda LNG terminal (hereinafter – LNG terminal) still remains at a high level, however, revenue for the three months of 2020 comprise EUR 11.5 million and is lower by EUR 6.5 million or 36% compared to the same period of 2019 (EUR 18 million) due to the reduction of LNG security supplement by EUR 6.7 million in Q1 2020. Compared to the same period of 2019, more income was generated due to much higher level of LNG regasification, which partially compensated the lower revenue due to the reduction of LNG security supplement.

Revenue of oil terminals for the first three months of 2020 decrease by EUR 0.7 million compared to the same period of 2019. Sales revenue of KN oil terminals were influenced by the historically low oil prices and unfavorable oil refining margins, which influenced oil production volumes and respectively had a negative impact on oil transit. Moreover, due to warm winter season, demand of diesel fuel, heating oil and similar fuels decreased, hence inventories have increased and caused lower refining margins. As a consequence, production capacities have been decreased in regions’ refineries. However, intensive transshipment of crude oil at KN oil terminal in Klaipėda in March positively influenced and partially compensated lower sales revenue of handling traditional oil products at Company’s oil terminals.

During the first three months of 2020 revenue from commercial LNG activities comprise EUR 1.2 million and is higher by 94% compared to the same period of 2019 (EUR 60 thousand). Commercial LNG activities comprise of business development projects, small scale LNG reloading station in Klaipėda and LNG terminal operator services provided at the Port of Acu terminal in Brazil.

Enclosed:

1. Interim Condensed Consolidated and Separate Financial Statements of AB Klaipėdos nafta for the three months period ended 31 March 2020.
2. Presentation of the unaudited financial results of the Group for the 3 months period of 2020.

Jonas Lenkšas, Chief Financial Officer,

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