MOL - Huge Beat, 9M Reported EPS Reached HUF 960, EBITDA Guidance Lifted
Huge beat, 9M reported EPS reached HUF 960, EBITDA guidance lifted
- MOL significantly beat the consensus on profit (+13%) and on CCS EBITDA (+20%) because of better DS (+28% vs. cons) and upstream (+13% vs. cons).
- Key positives:
- FY CCS EBITDA and simplified FCF guidance is lifted again to USD 4.3bn (+28%) and to USD 2.4 bn (+54% - similar amount in absolute term) yet it still remains below consensus estimates of USD 3.8bn (our USD 4.0bn)
- ATH clean cash margin at upstream division (84.5 USD/bbl) thanks to high natural gas price realization +64% q-o-q
- A few more quarters and MOL will be in net cash position, especially once WC reverses (WC: USD 2bn in 9M vs. net debt of USD 1.5bn in Q3) - gearing is 13.6%, net debt to EBITDA 0.4x
- In Q3 MOL’s reported EPS reached HUF 386 an amount it used to generate in a FY year between 2016 - 2019
- Key negatives:
- Petchem EBITDA plummeted by 90% showing extreme weakness of the segment
- Upstream clean cash margin may have reached the top as natural gas price cap in Croatia take effect on October at 59 EUR/MWh (for households). Croatian natural gas production is 11% of MOL’s total prod.
- MOL is in a difficult position to communicate such a profitability and argue against the fuel price cap in Hungary
- MOL saw large FX loss in an amount of USD 150mn because of the weakening HUF currency.
Magyar Olaj-Es Gazipari is an integrated oil and gas enterprise based in Hungary and active in central and eastern Europe. Co.'s core activities include: exploration and production of crude oil, natural gas and gas products; refining, transportation, storage and distribution of crude oil products in both retail and wholesale markets; importation, transportation, storage and wholesale trading of natural gas and other gas products; and the production and sale of olefins and polyolefins. TVK, the petrochemical affiliate of Co., is an olefin and polyolefin producer in Hungary.
Concorde Securities Ltd. is Hungary’s leading independent company engaged in investment banking activities. It provides its clients with integrated financial services, including securities trading, research, corporate financing advisory, capital market transactions, wealth management and investment advisory. The operational management of the company is the responsibility of the CEO, while the owners/managers (who control one-third of the company through their shares and options) are in charge of its strategic governance. Concorde Securities Ltd. is a member of the Budapest, Frankfurt, Warsaw and Bucharest stock exchanges, as well as of the Hungarian Association of Investment Service Providers.
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