Release Date: August 29, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Strong demand increase driven by auto fuels and high tourism.
- Higher utilization and production in refining operations.
- Significant contribution from international markets, with exports and non-ground fuel sales accounting for 74% of total refining sales.
- Positive performance from marketing businesses both in Greece and internationally.
- Increasing portfolio of renewables contributing to EBITDA, with a clean EBITDA of EUR230 million for the quarter and EUR560 million for the half year.
Negative Points
- Temporary slowdown expected in refining margins compared to last year's third quarter.
- Renewables projects face delays and curtailments, impacting profitability.
- Decline in the number of owned stations in the network, with further reductions expected.
- Impact of the solidarity contribution to be reflected in Q3, affecting financial statements by EUR173 million.
- Challenges in the power and gas portfolio, with market conditions not supportive for traditional and commercial operations.
Q & A Highlights
Q: How are you seeing the refining margin outlook for the rest of the year?
A: The market is well supplied, and we expect some refineries to go offline for maintenance starting in September. We hope to see an increase in demand as we move into winter, particularly from India. The second half of the year is expected to be close to the second quarter of this year, but we do not anticipate the same volatility as last year.
Q: We continue to see a decline in the number of stations owned and networked in Greece. How should we think about the network size in the coming quarters?
A: The number of stations is defined by the market size and geography. We expect a further decline of 10 to 50 petrol stations per year. This trend is likely to be seen across other companies as well.
Q: Can you provide a timeline for the planned maintenance at the Elefsina and Aspropyrgos refineries?
A: The Elefsina refinery will have a planned shutdown in the first half of the year. The Aspropyrgos refinery is planned for maintenance at the end of next year, depending on discussions.
Q: How do you see the environment for petrochemicals in the second half of the year?
A: We expect the improvement in the petrochemical environment to continue in the second half of the year.
Q: Given the curtailments faced in Q2, are you considering changing the mix to reduce merchant exposure in renewables?
A: Curtailment is here to stay. We are increasing our position in storage and starting the construction of our first stand-alone storage asset in Thessaloniki. We are also looking at hybrid projects to better manage curtailment.
Q: Can you provide the latest developments regarding the debt fund and pension associates?
A: This is in progress, and we do not have anything announceable at this point. We aim to streamline our portfolio and achieve synergies.
Q: How significant is the impact from the Red Sea issues, and can it be quantified?
A: The impact includes increased working capital and additional costs for rerouting cargoes. The cost of rerouting is approximately EUR1.5 million per VLCC.
Q: Can you confirm which quarter you will hit the one gigawatt capacity in 2025 for renewables?
A: We remain confident in reaching our one gigawatt target by the end of next year. The exact quarter is difficult to predict, but it is within reach given our current projects.
Q: Are you confident that the third quarter will be better for renewables given the curtailments in the previous quarters?
A: The situation has improved in the third quarter, and we expect better performance due to higher demand.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
