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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Pjsc Lukoil | LSE:LKOH | London | Ordinary Share | RU0009024277 | ORD RUB0.025 |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 56.2184 | 0.00 | 00:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
0 | 0 | N/A | 0 |
TIDMLKOD
RNS Number : 3569I
PJSC LukOil
29 August 2016
PJSC LUKOIL
CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(prepared in accordance with IFRS)
As of and for the three and six-month periods ended 30 June 2016
(unaudited)
These condensed interim consolidated financial statements were prepared by PJSC LUKOIL in accordance with IFRS and have not been audited by our independent auditor. If these condensed interim consolidated financial statements are audited in the future, the audit could reveal differences in our consolidated financial results and we can not assure that any such differences would not be material.
Auditors' Report on Review of Condensed Interim Consolidated Financial Statements To the Shareholders and Board of Directors PJSC LUKOIL
Introduction
We have reviewed the accompanying consolidated statement of financial position of PJSC LUKOIL (the "Company") and its subsidiaries (the "Group") as at 30 June 2016, and the related consolidated statements of profit or loss and other comprehensive income for the three- and six-month periods ended 30 June 2016 and the related consolidated statements of changes in equity and cash flows for the six - month period ended 30 June 2016, and notes to the condensed interim consolidated financial statements (the "condensed interim consolidated financial statements"). Management is responsible for the preparation and presentation of these condensed interim consolidated financial statements in accordance with International Financial Reporting Standard IAS 34 Interim Financial Reporting. Our responsibility is to express a conclusion on these condensed interim consolidated financial statements based on our review.
Scope of review
We conducted our review in accordance with International Standard on Review Engagements 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity. A review of condensed interim consolidated financial statements consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the condensed interim consolidated financial statements as at 30 June 2016, and for the three -and six-month periods ended 30 June 2016 are not prepared, in all material respects, in accordance with International Financial Reporting Standard IAS 34 Interim Financial Reporting.
Oussov A.I. Director, power of attorney dated 16 March 2015 No. 18/15 JSC "KPMG" 29 August 2016 Moscow, Russian Federation
PJSC LUKOIL
Consolidated Statement of Financial Position
(Millions of Russian rubles)
31 December ------------ 30 June 2016 Note (unaudited) 2015 -------------------------------- ---- ------------ ------------- Assets Current assets Cash and cash equivalents 6 346,703 257,263 Accounts receivable, net 7 388,706 440,489 Other current financial assets 16,970 23,768 Inventories 8 388,783 340,196 Income tax prepaid 15,668 7,413 Other taxes receivable 9 67,009 81,692 Other current assets 10 61,063 62,826 Total current assets 1,284,902 1,213,647 Property, plant and equipment 12 3,380,811 3,411,153 Investments in associates and joint ventures 11 169,047 181,744 Other non-current financial assets 13 106,424 102,067 Deferred income tax assets 27,018 28,735 Goodwill and other intangible assets 47,416 51,749 Other non-current assets 30,853 31,512 -------------------------------- ---- ------------ ------------- Total non-current assets 3,761,569 3,806,960 -------------------------------- ---- ------------ ------------- Total assets 5,046,471 5,020,607 -------------------------------- ---- ------------ ------------- Liabilities and equity Current liabilities Accounts payable 14 424,715 394,339 Short-term borrowings and current portion of long-term debt 15 132,097 60,506 Income tax payable 6,990 11,640 Other taxes payable 17 93,545 73,277 Provisions 19 27,168 25,553 Other current liabilities 18 114,141 129,853 Total current liabilities 798,656 695,168 Long-term debt 16 732,582 799,207 Deferred income tax liabilities 234,943 234,107 Provisions 19 55,019 51,115 Other non-current liabilities 8,027 9,636 Total non-current liabilities 1,030,571 1,094,065 -------------------------------- ---- ------------ ------------- Total liabilities 1,829,227 1,789,233 -------------------------------- ---- ------------ ------------- Equity 20 Share capital 1,151 1,151 Treasury shares (241,615) (241,615) Additional paid-in capital 129,508 129,403 Other reserves 66,791 104,150 Retained earnings 3,254,923 3,229,379 -------------------------------- ---- ------------ ------------- Total equity attributable to PJSC LUKOIL shareholders 3,210,758 3,222,468 -------------------------------- ---- ------------ ------------- Non-controlling interests 6,486 8,906 -------------------------------- ---- ------------ ------------- Total equity 3,217,244 3,231,374 -------------------------------- ---- ------------ ------------- Total liabilities and equity 5,046,471 5,020,607 -------------------------------- ---- ------------ ------------- Acting Vice-president Vice-president of - Chief accountant of PJSC LUKOIL PJSC LUKOIL Fedotov G.S. Kozyrev I.A.
The accompanying notes are an integral part of these condensed interim consolidated financial statements.
PJSC LUKOIL
Consolidated Statement of Profit or Loss and Other Comprehensive Income
(Millions of Russian rubles, unless otherwise noted)
For the For the For the three three six months For the months months ended six months ended ended 30 June ended 30 June 30 June 2016 30 June 2016 2015 (unaudited) 2015 Note (unaudited) (unaudited) (unaudited) --------------------------------- ---- ------------ ------------ ------------ ------------ Revenues Sales (including excise and export tariffs) 28 1,338,959 1,476,966 2,516,633 2,917,271 Costs and other deductions Operating expenses (113,709) (105,828) (226,953) (211,509) Cost of purchased crude oil, gas and products (677,297) (777,640) (1,215,030) (1,477,705) Transportation expenses (77,665) (68,377) (164,364) (147,162) Selling, general and administrative expenses (45,302) (40,028) (93,125) (81,213) Depreciation, depletion and amortization (71,608) (87,058) (155,956) (165,521) Taxes other than income taxes (118,724) (141,219) (202,277) (271,054) Excise and export tariffs (113,820) (123,609) (228,769) (296,458) Exploration expenses (2,871) (13,586) (4,552) (14,783) --------------------------------- ---- ------------ ------------ ------------ ------------ Profit from operating activities 117,963 119,621 225,607 251,866 Finance income 22 3,511 4,036 7,342 8,567 Finance costs 22 (11,098) (11,026) (21,469) (22,486) Equity share in income of affiliates 3,425 2,382 5,778 6,475 Foreign exchange loss (28,945) (29,154) (74,323) (23,479) Other expenses 23 (4,205) (2,784) (7,548) (8,556) Profit before income
taxes 80,651 83,075 135,387 212,387 Current income taxes (17,183) (19,394) (27,659) (42,334) Deferred income taxes (774) 575 (2,064) (1,358) --------------------------------- ---- ------------ ------------ ------------ ------------ Total income tax expense (17,957) (18,819) (29,723) (43,692) --------------------------------- ---- ------------ ------------ ------------ ------------ Profit for the period 62,694 64,256 105,664 168,695 Profit for the period attributable to non-controlling interests (127) (508) (272) (916) --------------------------------- ---- ------------ ------------ ------------ ------------ Profit for the period attributable to PJSC LUKOIL shareholders 62,567 63,748 105,392 167,779 --------------------------------- ---- ------------ ------------ ------------ ------------ Other comprehensive income (loss), net of income taxes Items that may be reclassified to profit or loss: Foreign currency translation differences for foreign operations (21,923) (8,045) (37,314) (35,641) Items that will never be reclassified to profit or loss: Remeasurements of defined benefit liability / asset of pension plan 13 336 33 652 --------------------------------- ---- ------------ ------------ ------------ ------------ Other comprehensive loss (21,910) (7,709) (37,281) (34,989) --------------------------------- ---- ------------ ------------ ------------ ------------ Total comprehensive income for the period 40,784 56,547 68,383 133,706 Total comprehensive income for the period attributable to non-controlling interests (119) (511) (298) (967) --------------------------------- ---- ------------ ------------ ------------ ------------ Total comprehensive income for the period attributable to PJSC LUKOIL shareholders 40,665 56,036 68,085 132,739 --------------------------------- ---- ------------ ------------ ------------ ------------ Earnings per share of common stock attributable to PJSC LUKOIL shareholders (in Russian rubles): Basic 20 87.76 89.42 147.83 235.34 Diluted 20 87.76 88.13 147.83 231.28
The accompanying notes are an integral part of these condensed interim consolidated financial statements.
PJSC LUKOIL
Consolidated Statement of Changes in Equity (unaudited)
(Millions of Russian rubles)
Total equity attributable Additional to PJSC Share Treasury Equity-linked paid-in Other Retained LUKOIL Non-controlling Total capital shares notes capital reserves earnings shareholders interests equity ---------------- ------- --------- ------------- ---------- -------- --------- ------------ --------------- --------- 31 December 2015 1,151 (241,615) - 129,403 104,150 3,229,379 3,222,468 8,906 3,231,374 Profit for the period - - - - - 105,392 105,392 272 105,664 Other comprehensive income: Foreign currency translation differences - - - (37,340) - (37,340) 26 (37,314) Remeasurements of defined benefit liability / asset of pension plan - - - - 33 - 33 - 33 -------- --------- ------------ --------------- --------- Total comprehensive income (loss) (37,307) 105,392 68,085 298 68,383 Dividends on common stock - - - - - (79,848) (79,848) - (79,848) Changes in non-controlling interests - - - 105 (52) - 53 (2,718) (2,665) ---------------- ------- --------- ------------- ---------- -------- --------- ------------ --------------- --------- 30 June 2016 1,151 (241,615) - 129,508 66,791 3,254,923 3,210,758 6,486 3,217,244 ---------------- ------- --------- ------------- ---------- -------- --------- ------------ --------------- --------- 31 December 2014 1,151 (158,615) (83,000) 128,846 93,454 3,055,542 3,037,378 12,164 3,049,542 Profit for the period - - - - - 167,779 167,779 916 168,695 Other comprehensive income: Foreign currency translation differences - - - - (35,692) - (35,692) 51 (35,641) Remeasurements of defined benefit liability / asset of pension plan - - - - 652 - 652 - 652 -------- --------- --------- ------- --------- Total comprehensive income (loss) (35,040) 167,779 132,739 967 133,706 Dividends on common stock - - - - - (70,957) (70,957) - (70,957) Changes in non-controlling interests - - - 2,339 - - 2,339 (3,717) (1,378) -------------------- ----- --------- -------- ------- -------- --------- --------- ------- --------- 30 June 2015 1,151 (158,615) (83,000) 131,185 58,414 3,152,364 3,101,499 9,414 3,110,913 -------------------- ----- --------- -------- ------- -------- --------- --------- ------- ---------
The accompanying notes are an integral part of these condensed interim consolidated financial statements.
PJSC LUKOIL
Consolidated Statement of Cash Flows
(Millions of Russian rubles)
For the For the six six months months ended ended 30 June 30 June 2016 2015 Note (unaudited) (unaudited) ----------------------------------- ---- ------------ ------------ Cash flows from operating activities Profit for the period attributable to PJSC LUKOIL shareholders 105,392 167,779 Adjustments for non-cash items: Depreciation, depletion and amortization 155,956 165,521 Equity share in income of affiliates, net of dividends received (3,839) 65 Dry hole write-offs 522 13,668 Loss on disposals and impairments of assets 4,718 8,251 Income tax expense 29,723 43,692 Non-cash foreign exchange loss 70,506 21,211 Non-cash investing activities (69) (161) Finance income (7,342) (8,567) Finance costs 21,469 22,486 Bad debt provision 2,913 821 All other items - net 6,374 8,510 Changes in operating assets and liabilities: Trade accounts receivable 2,458 69,459 Inventories (87,849) (54,162) Accounts payable 85,588 (24,766) Other taxes 37,183 57,356 Other current assets and liabilities (49,754) (75,076) Income tax paid (35,788) (38,373) Dividends received 2,102 - Interests received 4,215 5,389 --------------------------------------- ---- ------------ ------------ Net cash provided by operating activities 344,478 383,103 --------------------------------------- ---- ------------ ------------ Cash flows from investing activities Acquisition of licenses (2,408) (371) Capital expenditures (248,664) (302,853)
Proceeds from sale of property, plant and equipment 624 1,219 Purchases of financial assets (13,299) (2,924) Proceeds from sale of financial assets 5,651 5,504 Sale of subsidiaries, net of cash disposed 1,414 2,718 Sale of equity method affiliates - 9,410 Acquisitions of subsidiaries, net of cash acquired - (272) Acquisitions of equity method affiliates (1,833) (3,299) Net cash used in investing activities (258,515) (290,868) --------------------------------------- ---- ------------ ------------ Cash flows from financing activities Proceeds from issuance of short-term borrowings 46,941 71,559 Principal repayments of short-term borrowings (12,178) (26,447) Proceeds from issuance of long-term debt 89,276 19,402 Principal repayments of long-term debt (14,050) (94,255) Interest paid (23,574) (18,190) Dividends paid on Company common shares (46,324) (40,934) Dividends paid to non-controlling interest shareholders (1,587) (767) Financing received from non-controlling interest shareholders 48 61 Sale of non-controlling interests - 9 Purchases of non-controlling interests (1,285) - Net cash provided by (used in) financing activities 37,267 (89,562) --------------------------------------- ---- ------------ ------------ Effect of exchange rate changes on cash and cash equivalents (33,790) (19,429) Net increase (decrease) in cash and cash equivalents 89,440 (16,756) Cash and cash equivalents at beginning of period 257,263 169,023 --------------------------------------- ---- ------------ ------------ Cash and cash equivalents at end of period 6 346,703 152,267 --------------------------------------- ---- ------------ ------------
The accompanying notes are an integral part of these condensed interim consolidated financial statements.
PJSC LUKOIL
Notes to Condensed Interim Consolidated Financial Statements (unaudited)
(Millions of Russian rubles, unless otherwise noted)
Note 1. Organization and environment
The primary activities of PJSC LUKOIL (the "Company") and its subsidiaries (together, the "Group") are oil exploration, production, refining, marketing and distribution. The Company is the ultimate parent entity of this vertically integrated group of companies.
The Group was established in accordance with Presidential Decree No. 1403, issued on 17 November 1992. Under this decree, on 5 April 1993, the Government of the Russian Federation transferred to the Company 51% of the voting shares of fifteen enterprises. Under Government Resolution No. 861 issued on 1 September 1995, a further nine enterprises were transferred to the Group during 1995. Since 1995, the Group has carried out a share exchange program to increase its shareholding in each of the twenty-four founding subsidiaries to 100%.
From formation, the Group has expanded substantially through consolidation of its interests, acquisition of new companies and establishment of new businesses.
In July 2015, the Company changed its legal form to Public Joint Stock Company ("PJSC") following the requirements of the amended Russian Civil Code.
Business and economic environment
The accompanying condensed interim consolidated financial statements reflect management's assessment of the impact of the business environment in the countries in which the Group operates on the operations and the financial position of the Group. The future business environments may differ from management's assessment.
Note 2. Basis of preparation
Statement of compliance
The condensed interim consolidated financial statements have been prepared in accordance with IAS 34 Interim Financial Reporting. These condensed interim consolidated financial statements should be read in conjunction with the Group's consolidated financial statements for 2015 prepared in accordance with International Financial Reporting Standards ("IFRS").
Selected explanatory notes are included to explain events and transactions that are significant to an understanding of the changes in financial position and performance of the Group since the last consolidated financial statements for 2015.
The accompanying condensed interim consolidated financial statements and notes thereto have not been audited by independent auditors, except for the consolidated statement of financial position at 31 December 2015.
The condensed interim consolidated financial statements were authorised by the Vice-president of the Company on 29 August 2016.
Functional and presentation currency
The functional currency of each of the Group's consolidated companies is the currency of the primary economic environment in which the company operates. Management has analysed factors that influence the choice of functional currency and has determined the functional currency for each Group company. For the majority of them the functional currency is the local currency. The functional currency of the Company is the Russian ruble ("RUB").
The presentation currency of the consolidated financial statements of the Group is the RUB. All financial information presented in the RUB has been rounded to the nearest million, except when otherwise indicated.
The results and financial position of Group companies whose functional currency is different from the presentation currency of the Group are translated into presentation currency using the following procedures. Assets and liabilities are translated at period-end exchange rates, income and expenses are translated at rates which approximate actual rates at the date of the transaction. Resulting exchange differences are recognised in other comprehensive income.
Note 3. Summary of significant accounting policies
The accounting policies adopted in the preparation of these condensed interim consolidated financial statements are consistent with those applied and disclosed in the consolidated financial statements for 2015.
Note 4. Use of estimates and judgments
Preparation of the consolidated financial statements in accordance with IFRS requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from those estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future periods affected.
Critical judgments in applying accounting policies that have the most significant effect on the amounts recognised in the consolidated financial statements are the following:
-- Estimation of oil and gas reserves; -- Estimation of useful lives of property, plant and equipment; -- Impairment of non-current assets; -- Assessment of asset retirement obligations; -- Assessment and recognition of provisions and contingent liabilities; -- Assessment of deferred income tax assets and liabilities; -- Determination of whether a joint arrangement is a joint venture or a joint operation.
Note 5. Income taxes
Operations in the Russian Federation are subject to a Federal income tax rate of 2.0% and a regional income tax rate that varies from 13.5% to 18.0% at the discretion of the individual regional administration. The Group's foreign operations are subject to taxes at the tax rates applicable to the jurisdictions in which they operate.
The Group's effective income tax rate for the periods presented differs from the statutory income tax rate primarily due to domestic and foreign tax rate differences and the incurrence of costs that are either not tax deductible or only deductible to a certain limit. Tax expense is recognised based on the management's best estimate of the weighted-average annual income tax rate expected for the full financial year multiplied by the pre-tax income of the interim reporting period.
The Company and its Russian subsidiaries file income tax returns in Russia. A number of Group companies in Russia are paying income tax as a consolidated taxpayers' group ("CTG"). This allows taxpayers to offset taxable losses generated by certain participants of a CTG against taxable profits of other participants of the CTG.
Note 6. Cash and cash equivalents
30 June 31 December 2016 2015 -------------------------------- ------- ----------- Cash held in RUB 34,135 98,253 Cash held in US dollars 283,745 141,863 Cash held in other currencies 28,823 17,147 Total cash and cash equivalents 346,703 257,263 --------------------------------- ------- -----------
Note 7. Accounts receivable, net
30 June 31 December 2016 2015 ---------------------------------- ------- ----------- Trade accounts receivable (net of allowances of 17,967 million RUB and 17,322 million RUB at 30 June 2016 and 31 December 2015, respectively) 356,223 375,531 Other current accounts receivable (net of allowances of 1,929 million RUB and 1,599 million RUB at 30 June 2016 and 31 December 2015, respectively) 32,483 64,958 Total accounts receivable, net 388,706 440,489 ----------------------------------- ------- -----------
Note 8. Inventories
30 June 31 December 2016 2015 --------------------------------- ------- ----------- Crude oil and petroleum products 323,763 275,941 Materials for extraction and drilling 21,327 21,345 Materials and supplies for refining 3,237 3,732 Other goods, materials and supplies 40,456 39,178 Total inventories 388,783 340,196 ---------------------------------- ------- -----------
Note 9. Other taxes receivable
30 June 31 December 2016 2015 ------------------------------- ------- ----------- VAT and excise tax recoverable 36,936 39,171 Export duties prepaid 10,108 21,824 Other taxes prepaid 19,965 20,697 Total other taxes receivable 67,009 81,692 -------------------------------- ------- -----------
Note 10. Other current assets
30 June 31 December 2016 2015 --------------------------- ------- ----------- Advance payments 25,681 16,341 Prepaid expenses 25,910 31,960 Other assets 9,472 14,525 Total other current assets 61,063 62,826 ---------------------------- ------- -----------
Note 11. Investments in associates and joint ventures
Carrying value of investments in associates and joint ventures:
Ownership, % -------------------- 30 June 31 December 30 June 31 December Name of the company Country 2016 2015 2016 2015 ---------------------- ----------- ------- ----------- ------- ----------- Joint Ventures: Tengizchevroil Kazakhstan 5% 5% 90,752 99,843 Caspian Pipeline Consortium Kazakhstan 12.5% 12.5% 25,590 27,574 Turgai Petroleum Kazakhstan 50% 50% 1,763 1,675 Shakh-Deniz Midstream Azerbaijan 10% 10% 22,246 22,284 Associates: Other associates 28,696 30,368 Total 169,047 181,744 ----------------------------------- ------- ----------- ------- -----------
Note 12. Property, plant and equipment
Refining, Exploration marketing and production and distribution Other Total -------------------------- ---------------- ------------------ --------- ------------ Cost 1 January 2016 3,232,673 1,206,252 103,587 4,542,512 Additions 203,974 28,882 1,041 233,897 Capitalised borrowing costs 4,694 211 - 4,905 Disposals (5,845) (17,437) (516) (23,798) Foreign currency translation differences (138,021) (48,226) (1,825) (188,072) Other (4,215) 6,171 338 2,294 -------------------------- ---------------- ------------------ --------- ------------ 30 June 2016 3,293,260 1,175,853 102,625 4,571,738 -------------------------- ---------------- ------------------ --------- ------------ Depreciation and impairment 1 January 2016 (953,254) (259,515) (14,627) (1,227,396) Depreciation for the period (106,474) (43,491) (3,058) (153,023) Impairment loss - (78) - (78) Disposals 1,209 9,486 268 10,963 Foreign currency translation differences 77,554 16,444 404 94,402 Other (83) (1,893) (11) (1,987) -------------------------- ---------------- ------------------ --------- ------------ 30 June 2016 (981,048) (279,047) (17,024) (1,277,119) -------------------------- ---------------- ------------------ --------- ------------ Advance payments for property, plant and equipment 1 January 2016 94,619 1,280 138 96,037 -------------------------- ---------------- ------------------ --------- ------------ 30 June 2016 85,300 776 116 86,192 -------------------------- ---------------- ------------------ --------- ------------ Carrying amounts 1 January 2016 2,374,038 948,017 89,098 3,411,153 -------------------------- ---------------- ------------------ --------- ------------ 30 June 2016 2,397,512 897,582 85,717 3,380,811 -------------------------- ---------------- ------------------ --------- ------------ Refining, Exploration marketing and production and distribution Other Total -------------------------- ---------------- ------------------ --------- ---------- Cost 1 January 2015 2,556,173 1,030,097 95,392 3,681,662 Additions 225,859 63,104 1,646 290,609 Acquisitions through business combinations 305 149 - 454 Capitalised borrowing costs 171 503 - 674 Disposals (18,740) (1,459) (535) (20,734) Foreign currency translation differences (12,907) (39,808) (228) (52,943) Other 3,465 (3,765) (63) (363) -------------------------- ---------------- ------------------ --------- ---------- 30 June 2015 2,754,326 1,048,821 96,212 3,899,359 -------------------------- ---------------- ------------------ --------- ---------- Depreciation and impairment 1 January 2015 (444,128) (142,713) (8,525) (595,366) Depreciation for the period (131,721) (30,136) (2,960) (164,817) Disposals 707 3,473 116 4,296 Foreign currency translation differences 4,465 8,951 196 13,612 Other (1,597) (489) (42) (2,128) -------------------------- ---------------- ------------------ --------- ---------- 30 June 2015 (572,274) (160,914) (11,215) (744,403) -------------------------- ---------------- ------------------ --------- ---------- Advance payments for property, plant and equipment 1 January 2015 58,558 8,258 467 67,283 -------------------------- ---------------- ------------------ --------- ---------- 30 June 2015 74,812 2,397 510 77,719 -------------------------- ---------------- ------------------ --------- ---------- Carrying amounts 1 January 2015 2,170,603 895,642 87,334 3,153,579 -------------------------- ---------------- ------------------ --------- ---------- 30 June 2015 2,256,864 890,304 85,507 3,232,675 -------------------------- ---------------- ------------------ --------- ----------
The cost of assets under construction included in Property, plant and equipment was 615,890 million RUB and 676,908 million RUB at 30 June 2016 and 31 December 2015, respectively.
Exploration and evaluation assets:
For the For the six months six months ended ended 30 June 30 June 2016 2015 ------------------------------------------ ------------ ------------ 1 January 52,302 46,906 Capitalized expenditures 15,317 11,567 Reclassified to development assets (3,633) (8,036) Charged to expenses (483) (69) Foreign currency translation differences (1,160) - Other movements (127) 18 ------------------------------------------ ------------ ------------ 30 June 62,216 50,386 ------------------------------------------ ------------ ------------
Note 13. Other non-current financial assets
30 June 31 December 2016 2015 ---------------------------------- ------- ----------- Long-term loans 94,188 89,770 Non-current accounts and notes receivable 8,326 8,148 Other non-current financial assets 3,910 4,149 Total other non-current financial assets 106,424 102,067 ----------------------------------- ------- -----------
Note 14. Accounts payable
30 June 31 December 2016 2015 ----------------------- ------- ----------- Trade accounts payable 374,177 339,091 Other accounts payable 50,538 55,248 Total accounts payable 424,715 394,339 ------------------------ ------- -----------
Note 15. Short-term borrowings and current portion of long-term debt
30 June 31 December 2016 2015 ---------------------------------- ------- ----------- Short-term borrowings from third parties 60,096 33,611 Short-term borrowings from related parties 5,063 5,609 Current portion of long-term debt 66,938 21,286 Total short-term borrowings and current portion of long-term debt 132,097 60,506 ----------------------------------- ------- -----------
Short-term borrowings from third parties include amounts repayable in US dollars of 46,960 million RUB and 22,951 million RUB and amounts repayable in other currencies of 13,136 million RUB and 10,660 million RUB at 30 June 2016 and 31 December 2015, respectively. The weighted-average interest rate on short-term borrowings from third parties was 4.36% and 5.43% per annum at 30 June 2016 and 31 December 2015, respectively. Approximately 78% of total short-term borrowings from third parties at 30 June 2016 are secured by inventories.
Note 16. Long-term debt
30 June 31 December 2016 2015 ------------------------------- -------- ----------- Long-term loans and borrowings from third parties 436,448 408,781 Long-term borrowings from related parties - 138 6.356% non-convertible US dollar bonds, maturing 2017 32,129 36,441 3.416% non-convertible US dollar bonds, maturing 2018 96,124 108,983 7.250% non-convertible US dollar bonds, maturing 2019 38,442 43,583 6.125% non-convertible US dollar bonds, maturing 2020 64,173 72,778 6.656% non-convertible US dollar bonds, maturing 2022 32,129 36,441 4.563% non-convertible US dollar bonds, maturing 2023 96,124 108,983 Capital lease obligations 3,951 4,365 -------------------------------- -------- ----------- Total long-term debt 799,520 820,493 Current portion of long-term debt (66,938) (21,286) Total non-current portion of long-term debt 732,582 799,207 -------------------------------- -------- -----------
Long-term loans and borrowings
Long-term loans and borrowings from third parties include amounts repayable in US dollars of 303,751 million RUB and 336,842 million RUB, amounts repayable in euros of 61,379 million RUB and 70,447 million RUB, amounts repayable in other currencies of 1,318 million RUB and 1,492 million RUB at 30 June 2016 and 31 December 2015, respectively, and amounts repayable in RUB of 70,000 million RUB at 30 June 2016. This debt has maturity dates from 2016 through 2028. The weighted-average interest rate on long-term loans and borrowings from third parties was 5.32% and 3.77% per annum at 30 June 2016 and 31 December 2015, respectively. A number of long-term loan agreements contain certain financial covenants which are being met by the Group. Approximately 15% of total long-term loans and borrowings from third parties at 30 June 2016 are secured by shares of an associated company, export sales and property, plant and equipment.
Note 17. Other taxes payable
30 June 31 December 2016 2015 -------------------------- ------- ----------- Mineral extraction tax 37,069 24,566 VAT 26,173 21,532 Excise tax 18,996 15,553 Property tax 4,400 4,583 Other taxes 6,907 7,043 Total other taxes payable 93,545 73,277 --------------------------- ------- -----------
Note 18. Other current liabilities
30 June 31 December 2016 2015 -------------------------------- ------- ----------- Advances received 28,906 79,424 Dividends payable 81,907 47,615 Other 3,328 2,814 Total other current liabilities 114,141 129,853 --------------------------------- ------- -----------
Note 19. Provisions
Asset Provision Provision retirement Provision for for obligation for employee environmental Pension compensated Other compensations liabilities provisions absences provisions Total ------------------- ------------ -------------- -------------- ------------ -------------- ------------ ------- 30 June 2016 33,466 24,279 5,244 7,630 4,944 6,624 82,187 Incl.: Non-current 31,707 12,679 3,057 6,132 66 1,378 55,019 Current 1,759 11,600 2,187 1,498 4,878 5,246 27,168 31 December 2015 32,919 19,837 5,455 7,913 3,591 6,953 76,668 ------------------- ------------ -------------- -------------- ------------ -------------- ------------ ------- Incl.: Non-current 32,632 6,733 3,575 6,392 134 1,649 51,115 Current 287 13,104 1,880 1,521 3,457 5,304 25,553
Assets retirement obligation:
For the For the six months six months ended ended 30 June 30 June 2016 2015 ------------------------------------------ ------------ ------------ 1 January 32,919 19,604 Provisions made during the period 1,816 255 Reversal of provisions (38) (172) Provisions used during the period (44) (47) Accretion expense 1,117 430 Changes in estimates 40 (370) Foreign currency translation differences (2,157) (266) Other (187) 78 ------------------------------------------ ------------ ------------ 30 June 33,466 19,512 ------------------------------------------ ------------ ------------
Note 20. Equity
Common shares
30 June 31 December 2016 2015 (thousands (thousands of shares) of shares) Authorized common shares, par value of 0.025 RUB each 850,563 850,563 Issued common shares, par value of 0.025 RUB each 850,563 850,563 Treasury shares (137,630) (137,630) Outstanding common shares 712,933 712,933 ------------------------------ ----------- -----------
Dividends
At the annual shareholders' meeting on 23 June 2016, dividends for 2015 were approved in the amount of 112.00 RUB per common share. At the extraordinary shareholders' meeting on 16 December 2015, interim dividends for 2015 were approved in the amount of 65.00 RUB per common share. Total dividends for 2015 were approved in the amount of 177.00 RUB per common share. At the annual shareholders' meeting on 25 June 2015, dividends for 2014 were approved in the amount of 94.00 RUB per common share. At the extraordinary shareholders' meeting on 12 December 2014, interim dividends for 2014 were approved in the amount of 60.00 RUB per common share. Total dividends for 2014 were approved in the amount of 154.00 RUB per common share.
Dividends on the Company's shares payable of 80,114 million RUB and 46,609 million RUB are included in "Other current liabilities" in the consolidated statement of financial position at 30 June 2016 and 31 December 2015, respectively.
Earnings per share
The calculation of basic and diluted earnings per share was as follows.
For the For the three three For the For the months months six months six months ended ended ended ended 30 June 30 June 30 June 30 June 2016 2015 2016 2015 --------------------------------- -------- -------- ----------- ----------- Profit for the period attributable to PJSC LUKOIL shareholders 62,567 63,748 105,392 167,779 --------------------------------- -------- -------- ----------- ----------- Add back interest and accretion on 2.625% convertible US dollar bonds, maturing 2015 (net of tax at effective rate) - 697 - 1,718 --------------------------------- -------- -------- ----------- ----------- Total diluted profit for the period attributable to PJSC LUKOIL shareholders 62,567 64,445 105,392 169,497 --------------------------------- -------- -------- ----------- ----------- Weighted average number of outstanding common shares (thousands of shares) 712,933 754,866 712,933 754,866 Equity-linked notes - (41,933) - (41,933) --------------------------------- -------- -------- ----------- ----------- Weighted average number of common shares (thousands of shares) 712,933 712,933 712,933 712,933 Add back treasury shares held in respect of convertible debt (thousands of shares) - 18,291 - 19,945 --------------------------------- -------- -------- ----------- ----------- Weighted average number of common shares, assuming dilution (thousands of shares) 712,933 731,224 712,933 732,878 --------------------------------- -------- -------- ----------- ----------- Earnings per share of common stock attributable to PJSC LUKOIL shareholders (RUB): Basic 87.76 89.42 147.83 235.34 Diluted 87.76 88.13 147.83 231.28 --------------------------------- -------- -------- ----------- -----------
Note 21. Personnel expenses
Personnel expenses were as follows.
For the three For the three For the six For the six months ended months ended months ended months ended 30 June 2016 30 June 2015 30 June 2016 30 June 2015 -------------------------- -------------- -------------- -------------- -------------- Salary 35,137 31,718 69,852 60,582 Statutory insurance contributions 7,394 6,825 14,994 13,644 Share-based payments 2,400 (557) 6,344 3,585 Total personnel expenses 44,931 37,986 91,190 77,811 -------------------------- -------------- -------------- -------------- --------------
Note 22. Finance income and costs
Finance income was as follows.
For the three For the three For the six For the six months ended months ended months ended months ended 30 June 2016 30 June 2015 30 June 2016 30 June 2015 ---------------------- -------------- -------------- -------------- -------------- Interest income from deposits 1,354 2,494 2,849 4,914 Interest income from loans 1,819 1,363 3,697 2,915 Other finance income 338 179 796 738 ---------------------- -------------- -------------- -------------- -------------- Total finance income 3,511 4,036 7,342 8,567 ---------------------- -------------- -------------- -------------- --------------
Finance costs were as follows.
For the three For the three For the six For the six months ended months ended months ended months ended 30 June 2016 30 June 2015 30 June 2016 30 June 2015 ------------------------ -------------- -------------- -------------- -------------- Interest expenses 10,259 9,576 20,184 20,567 Accretion expenses 751 123 1,124 442 Other finance expenses 88 1,327 161 1,477 ------------------------ -------------- -------------- -------------- -------------- Total finance costs 11,098 11,026 21,469 22,486 ------------------------ -------------- -------------- -------------- --------------
Note 23. Other income and expenses
Other income was as follows.
For the three For the three For the six For the six months ended months ended months ended months ended 30 June 2016 30 June 2015 30 June 2016 30 June 2015 ------------------------ -------------- -------------- -------------- -------------- Gain on disposal of assets 176 1,761 916 2,750 Changes in estimates of asset retirement obligation 9 156 29 258 Reversal on impairment of assets - 3 - 296 Other income 3,939 3,790 7,779 6,573 ------------------------ -------------- -------------- -------------- -------------- Total other income 4,124 5,710 8,724 9,877 ------------------------ -------------- -------------- -------------- --------------
Other expenses were as follows.
For the three For the three For the six For the six months ended months ended months ended months ended 30 June 2016 30 June 2015 30 June 2016 30 June 2015 ---------------------- -------------- -------------- -------------- -------------- Loss on disposal of assets 2,825 4,688 5,170 6,127 Impairment loss 356 189 464 5,170 Charity expenses 3,926 2,299 6,343 3,705 Other expenses 1,222 1,318 4,295 3,431 ---------------------- -------------- -------------- -------------- -------------- Total other expenses 8,329 8,494 16,272 18,433 ---------------------- -------------- -------------- -------------- --------------
Note 24. Operating lease
At 30 June 2016 and 31 December 2015, Group companies had commitments primarily related to the lease of vessels and petroleum distribution outlets. Commitments for minimum rentals under these leases are payable as follows.
30 June 31 December 2016 2015 ------------------ ------- ----------- Less than a year 31,215 35,858 1-5 years 49,069 46,589 More than 5 years 87,845 80,924 Total 168,129 163,371 ------------------- ------- -----------
Note 25. Commitments and contingencies
Capital commitments
At 30 June 2016, capital commitments of the Group relating to construction and acquisition of property, plant and equipment are evaluated as 471,866 million RUB.
Taxation environment
The taxation systems in the Russian Federation and other emerging markets where Group companies operate are relatively new and are characterised by numerous taxes and frequently changing legislation, which is often unclear, contradictory, and subject to interpretation. Often, differing interpretations exist among different tax authorities within the same jurisdictions and among taxing authorities in different jurisdictions. Taxes are subject to review and investigation by a number of authorities, who are enabled by law to impose severe fines, penalties and interest charges. In the Russian Federation a tax year remains open for review by the tax authorities during the three subsequent calendar years. However, under certain circumstances a tax year may remain open longer. Recent events within the Russian Federation suggest that the tax authorities are taking a more assertive position in their interpretation and enforcement of tax legislation. Such factors may create substantially more significant taxation risks in the Russian Federation and other emerging markets where Group companies operate, than those in other countries where taxation regimes have been subject to development and clarification over long periods.
The tax authorities in each region may have a different interpretation of similar taxation issues which may result in taxation issues successfully defended by the Group in one region being unsuccessful in another region. There is some direction provided from the central authority based in Moscow on particular taxation issues. The Group has implemented tax planning and management strategies based on existing legislation at the time of implementation. The Group is subject to tax authority audits on an ongoing basis, as is normal in the Russian environment and other republics of the former Soviet Union, and, at times, the authorities have attempted to impose additional significant taxes on the Group. Management believes that it has adequately met and provided for tax liabilities based on its interpretation of existing tax legislation. However, the relevant tax authorities may have differing interpretations and the effects on the consolidated financial statements, if the authorities were successful in enforcing their interpretations, could be significant.
Litigation and claims
On 27 November 2001, Archangel Diamond Corporation ("ADC"), a Canadian diamond development company, filed a lawsuit in the Denver District Court, Colorado against AO Arkhangelskgeoldobycha ("AGD"), a Group company, and the Company (together the "Defendants"). ADC alleged that the Defendants interfered with the transfer of a diamond exploration license to Almazny Bereg, a joint venture between ADC and AGD. ADC claimed compensatory damages of $1.2 billion (77.1 billion RUB) and punitive damages of $3.6 billion (231.3 billion RUB). On 15 October 2002, the District Court dismissed the lawsuit for lack of personal jurisdiction. This ruling was upheld by the Colorado Court of Appeals on 25 March 2004. However, on 21 November 2005, due to a procedural error, the Colorado Supreme Court remanded the case to the Colorado Court of Appeals and the Colorado Court of Appeals remanded the case to the District Court. On 20 October 2011, the Denver District Court dismissed all claims against the Company for lack of jurisdiction. On 23 August 2012, the Colorado Court of Appeals affirmed this decision. On 1 July 2013, the Colorado Supreme Court denied ADC's Petition for Writ of Certiorari. The case in the state court is therefore over.
On 6 January 2012, ADC filed a lawsuit in the US District Court for the District of Colorado (federal court) reasserting almost identical claims asserted in the aforementioned lawsuit and dismissed by the Denver District Court (state court). In the federal Court case, the Company has filed a Motion to Dismiss. On 18 December 2014, the federal court granted the motion based on lack of personal jurisdiction over the Company and the doctrine of "forum non conveniens". ADC filed a notice of appeal in the US Court of Appeals for the Tenth Circuit. On 9 February 2016, the US Court of Appeals for the Tenth Circuit affirmed the dismissal of the case on "forum non conveniens" grounds. On 23 February 2016, ADC filed a Petition for rehearing and for "rehearing en banc". On 1 April 2016, the US Court of Appeals for the Tenth Circuit denied both ADC'c Petition for rehearing and for "rehearing en banc". On 28 July 2016, ADC filed a Petition for Writ of Certiorari. The Company plans to seek dismissal of the case and vigorously defend the matter. Management does not believe that the ultimate resolution of this matter will have a material adverse effect on the Group's financial position.
In June 2014, the prosecutors with the Ploesti Court of Appeals (hereinafter the "Prosecutor's Office") issued an order on initiation of criminal proceedings and brought charges against PETROTEL-LUKOIL S.A. refinery, a Group company, and its general director based on alleged tax evasion and money laundering. Later the Prosecutor's Office added bad faith use of the company's credit and money laundering charges for 2008-2010 against LUKOIL Europe Holdings B.V., a Group company. The amount of the claim is not finalised. LUKOIL LUBRICANTS EAST EUROPE S.R.L., LUKOIL ENERGY & GAS ROMANIA S.R.L., Group companies, and a number of Romanian legal entities not affiliated with the Group are also considered to be suspects in this criminal case. At the moment a preliminary investigation of the criminal case is being conducted. Tax audits of PETROTEL-LUKOIL S.A. have not revealed any material violations so far. In July 2015, a new charge in respect of bad faith use of the company's credit and money laundering was brought against the general director and several officers of PETROTEL-LUKOIL S.A. A similar charge was brought against LUKOIL Europe Holdings B.V. and PETROTEL-LUKOIL S.A. for 2011-2014. On 3 August 2015, the Prosecutor's Office issued the final indictment on the new charges and submitted the case to the Prahova Tribunal for further consideration by the preliminary chamber judge. The allegations of bad faith use of the company's credit in respect of PETROTEL-LUKOIL S.A. were excluded from the final indictment. Following the preliminary hearing the Prosecutor's Office revised the amount of damage claimed from $2.2 billion (141.4 billion RUB) to $1.5 billion (96.4 billion RUB). This amount is not final. During the entire trial it may be revised by the Tribunal on the basis of evidence produced. On 15 December 2015, the Prahova Tribunal ascertained that there are numerous irregularities in the indictment act and returned the criminal file to the Prosecutor's Office. The solution was confirmed by the Ploesti Court of Appeal on 19 January 2016. However, the Prosecutor has prepared a new indictment act based on the same accusations which were submitted to the Prahova Tribunal on 22 January 2016. On 18 April 2016, the preliminary hearing chamber of the Prahova Tribunal decided on the hearing of the case on the merits. Moreover, on 10 May 2016, the Prahova Tribunal lifted all preventive measures that were in effect against the accused individuals. At the current stage of the hearings the defendants are making oral statements. Next hearing on the merits will take place on 22 September 2016. Management of PETROTEL-LUKOIL S.A. and its tax and legal counsel are actively defending the lawful rights and interests of the refinery, provide all required opinions, clarifications and comments, and prepare an exhaustive set of evidence to fully rebut the charges brought by the Prosecutor's Office. Management does not believe that the outcome of this matter will have a material adverse effect on the Group's financial position.
LUKOIL Overseas Karachaganak B.V., a Group company, among other contractors, is involved in the dispute related to cost recovery and calculation of the "fairness index" in accordance with the Final Production Sharing Agreement in respect of the Karachaganak field in Kazakhstan. An estimated total of claims filed by the Republic of Kazakhstan is about $1.8 billion (115.7 billion RUB), a share of LUKOIL Overseas Karachaganak B.V. is about $243 million (15.6 billion RUB). At the moment the parties are negotiating an amicable settlement of this dispute. Management does not believe that the ultimate resolution of this matter will have a material adverse effect on the Group's financial position.
The Group is involved in various other claims and legal proceedings arising in the normal course of business. While these claims may seek substantial damages against the Group and are subject to uncertainty inherent in any litigation, management does not believe that the ultimate resolution of such matters will have a material adverse impact on the Group's operating results or financial condition.
Political situation
Political and economic situation in Ukraine remained unstable during 2015-2016. Though the Group's assets and operations in Ukraine are not material, the Group monitors the situation and assesses the risks associated with its operations in Ukraine.
In July-September 2014, the United States ("US"), the European Union ("EU") and other countries imposed a set of economic sanctions on Russia, including certain sectoral sanctions which affect Russian oil and gas companies. Such sectoral sanctions prohibit US and the EU companies and individuals from providing, exporting, or reexporting directly or indirectly, goods, services (except for financial services), or technology in support of exploration or production for deepwater, Arctic offshore or shale projects on the territory of the Russian Federation. The Company considers these sanctions in its activities, continuously monitors them and analyses the effect of the sanctions on the Company's financial position and results of operations.
The Group is exposed to political, economic and legal risks due to its operations in Iraq. Management monitors the risks associated with the projects in Iraq and believes that there is no adverse effect on the Group's financial position that can be reasonably estimated at present.
Note 26. Related party transactions
In the rapidly developing business environment in the Russian Federation, companies and individuals have frequently used nominees and other forms of intermediary companies in transactions. The senior management of the Company believes that the Group has appropriate procedures in place to identify and properly disclose transactions with related parties in this environment and has disclosed all of the relationships identified which it deemed to be significant. Related party sales and purchases of oil and oil products were primarily to and from associated companies.
Outstanding balances with related parties were as follows.
30 June 31 December 2016 2015 ----------------------- ------- ----------- Accounts receivable 9,097 10,925 Other financial assets 100,069 98,538 ------------------------ ------- ----------- Total assets 109,166 109,463 ------------------------ ------- ----------- Accounts payable 8,538 8,458 Loans and borrowings 5,063 5,747 ------------------------ ------- ----------- Total liabilities 13,601 14,205 ------------------------ ------- -----------
Related party transactions were as follows.
For the three For the three For the six For the six months ended months ended months ended months ended 30 June 2016 30 June 2015 30 June 2016 30 June 2015 ---------------------- -------------- -------------- -------------- -------------- Sales of oil and oil products 5,453 8,452 9,834 16,035 Other sales 452 382 846 741 Purchases of oil and oil products 22,297 16,335 35,442 33,513 Other purchases 461 1,392 2,685 3,435 Loans given 4,105 1,350 12,529 1,869 Loans received 1,548 8,537 2,238 11,333 ---------------------- -------------- -------------- -------------- --------------
Note 27. Compensation plan
In December 2012, the Company introduced a compensation plan available to certain members of management for the period from 2013 to 2017, which is based on assigned shares and provides compensation consisting of two parts. The first part represents annual bonuses that are based on the number of assigned shares and amount of dividend per share. The payment of these bonuses is contingent on the Group meeting certain financial KPIs in each financial year. The second part is based upon the Company's common shares appreciation from 2013 to 2017, with rights vesting after the date of the compensation plan's termination. The number of assigned shares is approximately 19 million shares.
For the first part of the share plan the Group recognised a liability based on expected dividends and number of assigned shares. The second part of the share plan was also classified as liability settled. The reporting date fair value of this part of the plan was estimated at 15,711 million RUB, using the Black-Scholes-Merton option-pricing model. The fair value was estimated assuming a risk-free interest rate of 9.53% per annum, an expected dividend yield of 7.08% per annum, an expected time to maturity of two years and a volatility factor of 14.99%. The expected volatility factor for the annual weighted average share price was estimated based on the historical volatility of the Company's shares for the previous ten years from 2006 till 2015.
Related to this share plan the Group recognised 2,400 million RUB of compensation expenses during the three months ended 30 June 2016, 557 million RUB of income during the three months ended 30 June 2015, 6,344 million RUB and 3,585 million RUB of compensation expenses during the six months ended 30 June 2016 and 2015, respectively. At 30 June 2016 and 31 December 2015, amounts of 16,042 million RUB and 9,698 million RUB related to this plan are included in "Provisions" of the consolidated statement of financial position, respectively.
At 30 June 2016, there was 4,713 million RUB of total unrecognized compensation cost related to unvested benefits. This cost is expected to be recognized periodically by the Group up to December 2017.
Note 28. Segment information
The Group has the following operating segments - exploration and production; refining, marketing and distribution; corporate and other business segments. These segments have been determined based on the nature of their operations. Management on a regular basis assesses the performance of these operating segments. The exploration and production segment explores for, develops and produces primarily crude oil. The refining, marketing and distribution segment processes crude oil into refined products, purchases, sells and transports crude oil and refined petroleum products, refines and sells chemical products, produces steam and electricity, distributes them and provides related services. The corporate and other business operating segment includes activities of the Company and businesses beyond the Group's traditional operations.
Geographical segments are based on the area of operations and include two segments: Russia and International.
EBITDA is a supplemental non-IFRS financial measure used by management to evaluate segments performance. EBITDA is defined as profit before interest, income taxes, depreciation and amortisation.
Operating segments
For the three months ended 30 June 2016
Refining, Exploration marketing Corporate and production and distribution and other Elimination Consolidated -------------------- --------------- ----------------- ---------- ----------- ------------ Sales and other operating revenues Third parties 42,485 1,288,758 7,716 - 1,338,959 Inter-segment 382,814 15,782 12,457 (411,053) - -------------------- --------------- ----------------- ---------- ----------- ------------ Total revenues 425,299 1,304,540 20,173 (411,053) 1,338,959 -------------------- --------------- ----------------- ---------- ----------- ------------ Operating expenses 67,355 59,393 5,063 (18,102) 113,709 Selling, general and administrative expenses 9,957 30,866 12,858 (8,379) 45,302 Profit (loss) for the period attributable to PJSC LUKOIL shareholders 67,519 24,299 (28,071) (1,180) 62,567 EBITDA 134,701 50,192 (26,532) 1,358 159,719 Income tax expense (17,957) Finance income 3,511 Finance costs (11,098) Depreciation, depletion and amortisation (71,608) Profit for the period attributable to PJSC LUKOIL shareholders 62,567 -------------------- --------------- ----------------- ---------- ----------- ------------
For the three months ended 30 June 2015
Refining, Exploration marketing Corporate and production and distribution and other Elimination Consolidated -------------------- --------------- ----------------- ---------- ----------- ------------ Sales and other operating revenues Third parties 64,659 1,405,223 7,084 - 1,476,966 Inter-segment 444,413 13,120 16,758 (474,291) - -------------------- --------------- ----------------- ---------- ----------- ------------ Total revenues 509,072 1,418,343 23,842 (474,291) 1,476,966 -------------------- --------------- ----------------- ---------- ----------- ------------ Operating expenses 63,017 44,414 5,424 (7,027) 105,828 Selling, general and administrative expenses 9,841 30,251 9,034 (9,098) 40,028 Profit (loss) for the period attributable to PJSC LUKOIL shareholders 63,312 22,766 (21,885) (445) 63,748 EBITDA 159,295 44,460 (23,595) (3,545) 176,615 Income tax expense (18,819) Finance income 4,036 Finance costs (11,026) Depreciation, depletion and amortisation (87,058) Profit for the period attributable to PJSC LUKOIL shareholders 63,748
-------------------- --------------- ----------------- ---------- ----------- ------------
For the six months ended 30 June 2016
Refining, Exploration marketing Corporate and production and distribution and other Elimination Consolidated -------------------- --------------- ----------------- ---------- ----------- ------------ Sales and other operating revenues Third parties 95,462 2,400,709 20,462 - 2,516,633 Inter-segment 693,546 31,983 25,906 (751,435) - -------------------- --------------- ----------------- ---------- ----------- ------------ Total revenues 789,008 2,432,692 46,368 (751,435) 2,516,633 -------------------- --------------- ----------------- ---------- ----------- ------------ Operating expenses 133,623 104,645 9,524 (20,839) 226,953 Selling, general and administrative expenses 19,976 66,697 24,903 (18,451) 93,125 Profit (loss) for the period attributable to PJSC LUKOIL shareholders 117,994 56,211 (68,727) (86) 105,392 EBITDA 261,611 109,991 (66,422) 18 305,198 Income tax expense (29,723) Finance income 7,342 Finance costs (21,469) Depreciation, depletion and amortisation (155,956) Profit for the period attributable to PJSC LUKOIL shareholders 105,392 -------------------- --------------- ----------------- ---------- ----------- ------------
For the six months ended 30 June 2015
Refining, Exploration marketing Corporate and production and distribution and other Elimination Consolidated -------------------- --------------- ----------------- ---------- ----------- ------------ Sales and other operating revenues Third parties 126,470 2,777,380 13,421 - 2,917,271 Inter-segment 867,940 27,680 28,600 (924,220) - -------------------- --------------- ----------------- ---------- ----------- ------------ Total revenues 994,410 2,805,060 42,021 (924,220) 2,917,271 -------------------- --------------- ----------------- ---------- ----------- ------------ Operating expenses 126,479 87,242 10,808 (13,020) 211,509 Selling, general and administrative expenses 20,088 60,740 19,022 (18,637) 81,213 Profit (loss) for the period attributable to PJSC LUKOIL shareholders 137,754 62,923 (20,875) (12,023) 167,779 EBITDA 312,734 115,273 (20,907) (16,189) 390,911 Income tax expense (43,692) Finance income 8,567 Finance costs (22,486) Depreciation, depletion and amortisation (165,521) Profit for the period attributable to PJSC LUKOIL shareholders 167,779 -------------------- --------------- ----------------- ---------- ----------- ------------
Geographical segments
For the For the three three For the For the months months six months six months ended ended ended ended 30 June 30 June 30 June 30 June 2016 2015 2016 2015 Sales of crude oil within Russia 23,404 37,859 44,744 75,232 Export of crude oil and sales of crude oil by foreign subsidiaries 340,858 390,764 633,406 771,001 Sales of petroleum products within Russia 146,110 149,217 276,286 280,196 Export of petroleum products and sales of petroleum products by foreign subsidiaries 740,748 817,644 1,365,635 1,620,430 Sales of chemicals within Russia 8,915 6,296 18,094 9,394 Export of chemicals and sales of chemicals by foreign subsidiaries 8,804 8,875 18,962 17,089 Sales of gas and gas products within Russia 8,582 9,533 17,820 18,831 Export of gas products and sales of gas and gas products by foreign subsidiaries 19,877 21,187 44,285 48,859 Sales of energy and related services within Russia 11,642 11,523 30,678 29,420 Sales of energy and related services by foreign subsidiaries 2,797 1,719 6,525 4,209 Other sales within Russia 12,677 9,797 22,896 18,628 Other export sales and other sales of foreign subsidiaries 14,545 12,552 37,302 23,982 ---------------------------------- --------- --------- ----------- ----------- Total sales 1,338,959 1,476,966 2,516,633 2,917,271 ---------------------------------- --------- --------- ----------- -----------
For the three months ended 30 June 2016
Russian Federation International Elimination Consolidated ------------------------------------ ----------- ------------- ----------- ------------ Sales and other operating revenues Third parties 224,961 1,113,998 - 1,338,959 Inter-segment 272,210 732 (272,942) - ------------------------------------ ----------- ------------- ----------- ------------ Total revenues 497,171 1,114,730 (272,942) 1,338,959 ------------------------------------ ----------- ------------- ----------- ------------ Operating expenses 81,746 29,386 2,577 113,709 Selling, general and administrative expenses 24,937 21,286 (921) 45,302 Profit for the period attributable to PJSC LUKOIL shareholders 58,503 6,049 (1,985) 62,567 EBITDA 125,434 35,635 (1,350) 159,719 ------------------------------------ ----------- ------------- ----------- ------------
For the three months ended 30 June 2015
Russian Federation International Elimination Consolidated ------------------------------------ ----------- ------------- ----------- ------------ Sales and other operating revenues Third parties 229,945 1,247,021 - 1,476,966 Inter-segment 320,174 1,474 (321,648) - ------------------------------------ ----------- ------------- ----------- ------------ Total revenues 550,119 1,248,495 (321,648) 1,476,966 ------------------------------------ ----------- ------------- ----------- ------------ Operating expenses 78,785 29,575 (2,532) 105,828 Selling, general and administrative expenses 20,121 21,032 (1,125) 40,028 Profit (loss) for the period attributable to PJSC LUKOIL shareholders 68,049 (3,397) (904) 63,748 EBITDA 125,477 51,775 (637) 176,615 ------------------------------------ ----------- ------------- ----------- ------------
For the six months ended 30 June 2016
Russian Federation International Elimination Consolidated ------------------------------------ ----------- ------------- ----------- ------------ Sales and other operating revenues Third parties 429,952 2,086,681 - 2,516,633 Inter-segment 509,437 1,327 (510,764) - ------------------------------------ ----------- ------------- ----------- ------------ Total revenues 939,389 2,088,008 (510,764) 2,516,633 ------------------------------------ ----------- ------------- ----------- ------------ Operating expenses 155,859 61,275 9,819 226,953 Selling, general and administrative expenses 48,874 46,058 (1,807) 93,125 Profit for the period attributable
to PJSC LUKOIL shareholders 99,012 7,277 (897) 105,392 EBITDA 219,209 86,517 (528) 305,198 ------------------------------------ ----------- ------------- ----------- ------------
For the six months ended 30 June 2015
Russian Federation International Elimination Consolidated ------------------------------------ ----------- ------------- ----------- ------------ Sales and other operating revenues Third parties 444,517 2,472,754 - 2,917,271 Inter-segment 648,487 2,757 (651,244) - ------------------------------------ ----------- ------------- ----------- ------------ Total revenues 1,093,004 2,475,511 (651,244) 2,917,271 ------------------------------------ ----------- ------------- ----------- ------------ Operating expenses 147,953 62,236 1,320 211,509 Selling, general and administrative expenses 42,109 41,357 (2,253) 81,213 Profit for the period attributable to PJSC LUKOIL shareholders 179,874 795 (12,890) 167,779 EBITDA 303,605 102,648 (15,342) 390,911 ------------------------------------ ----------- ------------- ----------- ------------
In the International segment the Group receives the most substantial revenues in Switzerland and the USA.
For the For the three three For the For the months months six months six months ended ended ended ended 30 June 30 June 30 June 30 June 2016 2015 2016 2015 ------------------- -------- -------- ----------- ----------- Sales revenues in Switzerland 641,323 683,645 1,148,389 1,368,906 in the USA 127,777 130,394 210,305 212,498 ------------------- -------- -------- ----------- -----------
These amounts are attributed to individual countries based on the jurisdiction of subsidiaries making the sale.
Note 29. Fair value
There are the following methods of fair value measurement based on the valuation technique:
Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability,
either directly or indirectly;
Level 3: unobservable inputs.
The following table shows the carrying amounts and fair values of financial assets and financial liabilities included in the consolidated statement of financial position at 30 June 2016 and 31 December 2015.
Fair value --------------- --------- --------------------------- 30 June Carrying Level Level Level 2016 amount 1 2 3 Total --------------- --------- -------- ------- -------- -------- Financial assets: Commodity derivative contracts 14,640 - 14,640 - 14,640 Available for sale securities 3,813 - - 3,813 3,813 --------------- --------- -------- ------- -------- -------- Financial liabilities: Commodity derivative contracts 16,969 - 16,969 - 16,969 Long-term debt 799,520 376,856 - 452,253 829,109 --------------- --------- -------- ------- -------- -------- Fair value --------------- --------- --------------------------- 31 December Carrying Level Level Level 2015 amount 1 2 3 Total --------------- --------- -------- ------- -------- -------- Financial assets: Commodity derivative contracts 41,648 - 41,648 - 41,648 Available for sale securities 4,045 - - 4,045 4,045 --------------- --------- -------- ------- -------- -------- Financial liabilities: Commodity derivative contracts 10,827 - 10,827 - 10,827 Long-term debt 820,493 400,140 - 392,952 793,092 --------------- --------- -------- ------- -------- --------
The fair values of cash and cash equivalents (Level 1), current and long-term accounts receivable (Level 3) are approximately equal to their value as disclosed in the consolidated statement of financial position. The fair value of long-term receivables was determined by discounting with estimated market interest rates for similar financing arrangements. The fair value of long-term loans (Level 3) was determined as a result of discounting using estimated market interest rates for similar financing arrangements. These amounts include all future cash outflows associated with the long-term debt repayments, including the current portion and interest. Market interest rates mean the rates of raising long-term debt by companies with a similar credit rating for similar periods, repayment schedules and similar other main terms. The fair value of bonds (Level 1) was determined based on market quotations at 30 June 2016 and 31 December 2015.
This information is provided by RNS
The company news service from the London Stock Exchange
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