MOL Makes 4Q Losses As Falling Oil Prices Offset Strong USD Vs HUF

BUDAPEST--MOL Nyrt. (MOL.BU), one of central Europe's largest refineries and Hungary's biggest company by revenue, turned loss-making in the fourth quarter as falling oil prices offset the effects of higher production and stronger dollar against the forint, the firm's earnings report published Tuesday shows.

MAIN FACTS:

-- MOL's clean net loss was 68.6 billion forints ($272 million), compared to HUF5.2 billion profit the same period a year ago.

-- At the same time, clean earnings before interest, taxes, depreciation and amortization, or Ebitda, one of the key indicators for the sector, was up 19% on the year at HUF146 billion, versus HUF127 billion expected by eight analysts in a poll by portfolio.hu.

-- Besides a strong downstream, there was also some improvement in the upstream segment, partially a result of successful field development both in the mainland and offshore in Central Europe.

-- Loss per share was HUF778 versus HUF38 earnings per share a year earlier and a loss per share of HUF226 expected in the poll.

-- In full 2014, capital expenditure or Capex spending reached HUF532 billion ($1.97 billion) in 2014, spent on completing the firm's North Sea acquisition and a retail network buy of 44 fuel stations in the Czech Republic. This compares to a planned Capex of up to $1.9 billion.

-- Indebtedness ratio, or net gearing narrowed to 19.6% versus 16% a year ago, MOL said.

-- Zsolt Hernadi, chief executive and chairman said the company saw strong results in 2014 despite falling oil prices. He announced the firm's newest Downstream Program for 2015-2017 which is expected to bring $500 million downstream EBITDA improvement and "very strong" free cash flow generation over the coming years.

-- "In terms of acquisitions, we expect to benefit from lower oil prices; we're ready to act once the opportunity arises," Mr. Hernadi added.

-- MOL shares closed up 0.5% at HUF11,785 on the Budapest Stock Exchange Monday.

Write to Veronika Gulyas at [e-mail]

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