In Q1 2015, the PGNiG Group reported net profit of PLN 1.2bn, up 5% year on year, mainly due to improved efficiency and cost reductions, including lower cost of gas purchases. Such strong performance was achieved despite another mild winter, similar to that last year.

The Group's EBITDA grew by 7%, to PLN 2.3bn, compared with PLN 2.2bn in the corresponding period of 2014. With a 38% share, the Exploration and Production segment was the largest contributor to the Group's EBITDA, followed by Trade & Storage with a 27% share, Distribution with a 22% share, and Generation accounting for 13% of the total. In Q1 2015, the Group's revenue went up by 31%, to nearly PLN 12.5bn, against PLN 9.5bn reported in Q1 2014.

Exploration and Production segment - higher crude oil sales volume

Revenue from the Exploration and Production segment in the first quarter of 2015 came in at PLN 1.2bn, a year-on-year decrease of 25%, which translated into EBITDA of PLN 878m, down 22% on the same period last year.

The factors contributing to the segment's performance included a 21% growth in crude oil sales volume, cost reductions, as well as a PLN 200m drop in revenue from sale of crude oil, caused by a nearly 40% decline in crude prices expressed in the Polish złoty.

The Group's oil and condensate production in Q1 2015 went up by some 20%, to 386 thousand tonnes, compared with 322 thousand tonnes in Q1 2014.

In Q1 2015, production of natural gas (measured as high-methane gas equivalent) remained unchanged year on year at 1.2 bcm.

Higher gas sales margin

The Trade and Storage segment's performance in Q1 2015 was driven, among other factors, by the declining unit cost of gas procurement. As a result, the margin on sales of high-methane gas was +4% in Q1 2015, compared with +3% in the corresponding period of 2014. The segment's revenue was up 41%, to approximately PLN 11.2bn.

In Q1 2015, gas sales by the PGNiG Group went up by 2.8 bcm, to 7.7 bcm, compared with 4.9 bcm in Q1 2014. Sales through the Polish Power Exchange (TGE) increased by 2.8 bcm. By customer groups, larger gas volumes were sold on the Polish Power Exchange, to the customers of PGNiG Sales & Trading, and to power and heating plants.

PGNiG Group's performance in Q1 2015 (PLNm)

Q1 2014 Q1 2015 Change
Revenue 9,535 12,495 31%
Operating expenses (excl. D&A) (7,354) (10,169) 38%
EBITDA 2,181 2,326 7%
EBIT 1,558 1,662 7%
Net profit 1,180 1,244 5%

Higher sales volumes contribute positively to the Distribution segment's performance

The Distribution segment's revenue rose by 5%, to PLN 1.3bn, in Q1 2015. The higher revenue was attributable to the gas distribution volumes growing by 1%, to 3.3 bcm, due to average air temperatures being lower by 0.6 degree Celsius.

Sales in the Generation segment driven by electricity and heat prices

In Q1 2015, the Generation segment's revenue was PLN 688m, having increased by 6% on the corresponding period of 2014 on the back of higher electricity and heat prices. Sales of electricity from the Group's own generation sources stood at 1.39 TWh in Q1 2015, remaining flat year on year, while sales of heat fell by 2.5%, to 15.1 PJ.

Utilisation of gas storage capacities

As at the end of March 2015, the Group held 1.25 bcm of high-methane gas stocks in its underground storage facilities, compared with 1.26 bcm in March 2014.

Dorota Gajewska

Press Officer

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