WOOD Flash – Rosneft: 1Q18 results – improving FCF is quite encouraging
Rosneft reported generally strong 1Q18 results yesterday (14 May), with a notable improvement in FCF generation. We estimate c.USD 1bn of lost profit from the weaker domestic refining market, which we expect to recover throughout FY18E as domestic crack spreads improve. We believe that the stronger oil price, coupled with the recent initiatives to boost shareholder value through deleveraging and a buyback, make Rosneft’s investment case quite attractive, with yesterday’s results generally proving that the company is on track to achieve its goals, in our view. Hence, we reiterate our BUY and recently-raised PT of USD 7.3/GDR.
WOOD & Company is the leading investment bank in Emerging Europe. Founded in 1991 and head-quartered in Prague, our footprint spans the region and touches investors around the globe.
A pioneer in Emerging Europe, WOOD executed many of the first CEE equity trades and landmark investment banking transactions. Our electronic trading platform was the first in the region, and remains the best. We are continually expanding our relevance and reach in these ever-evolving markets.
Our equity market share reflects our stature: 7% in Warsaw, 20% in Bucharest, 16% in Hungary, 40% in Prague and 5% in Vienna. Our distribution is unparalleled, with the largest salesforce in the region, servicing a uniquely diverse investor base.
We couple local expertise with a truly international perspective. With offices on the ground in the region, and in key financial hubs such as London and Milano, we are never far from our clients and we remain at the forefront of what’s afoot in the CEE emerging and frontier landscape.
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