Beat the highest estimates, very conservative FY guidance but still 10% above BBG consensus
Summary:
- MOL beat the CCS clean EBITDA consensus estimates by large + 19% (!), the main surprise came from the downstream part where EBITDA was stronger than 34% compared to consensus. Profit arrived to HUF 56.8 bn vs the consensus of HUF 34 bn +67%.
- Management confirmed the top end of the FY CCS EBITDA guidance and expects USD 1.9 bn +10% vs the consensus on Bloomberg. We are of the view that FY CCS clean EBITDA could be even better than (pls see our argument below). Similarly to EBITDA guidance, simplified FCF is also expected to arrive to the upper end of the range namely to USD 0.4 bn (YTD at USD 0.6bn).
- Debt metrics decreased on the back of strong cash flows to net debt to EBITDA climbed to 1.54x (1.63x in Q2) while gearing ticked down to 27.7% from previous quarter of 28.6%.
- No mention on dividend.
All in all, the results are generally better than expected, (CCS EBITDA arrived significantly higher than consensus +19%), and all segments generated positive FCF in both Q3 and 9M. The positive surprise (+34%) came from refining segment where MOL generated 4.4 USD/bbl unit EBITDA despite the depressed refining margin of 1.1 USD/bbl mainly because of cut back on lower margin third-party sales, thus own production increased by 4% y-o-y. Consumer Service was also a surprise factor (+11%) as EBITDA/site managed to increase by +12% y-o-y in USD terms.
CAPEX is significantly down (YTD -33% Y-o-Y in USD terms) both sustain (-24% Y-o-Y) and transformational (-44% Y-o-Y) reflecting strong cost control and COVID 19 restrictions which slowed down investments. Although the Polyol project exceeds 70% overall completion at the end of Q3, progress is somewhat behind schedule as a result of pandemic.
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.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.