The estimates of the stock market analysts point to OMV Petrom posting a record profit in the first nine months of this year, RON2.5 billion (EUR601 million), up 77% on the same time last year, reveals a poll conducted by ZF among Erste Group, ING, Unicredit, CA-IB Securities, EFG Eurobank Securities, Broker Cluj, Ieba Trust and Tradeville analysts.
The profit analysts estimate for the first nine months is higher than Petrom’s profit for the entire last year, RON2.2 billion.
The average analysts’ estimate in the third quarter points to a net income of RON782.3 million (EUR184 million) compared with an about RON110 million loss in July through September 2010. Petrom’s third quarter profit was affected by a one-off loss of about EUR100 million caused by the reassessment of its assets in Kazakhstan. Were it not for this loss, the profit would have stood at RON325 million in the third quarter of 2010.
Petrom will announce third quarter results on Wednesday and analysts expect the profit to be driven by the still high oil prices, which have a positive influence on the company’s margins and sales.
Oil peaked at about $110/barrel in March-April this year and then started to go down so that it now stands at $95/barrel, significantly higher than last year, though.
“We estimate a net profit of about RON0.9 billion for the third quarter, as a result of a rise in sales by some 17% compared with the same time last year because of the high oil price and of the high fuel prices on the domestic market,” said Manuela Ogrinja, analyst with EFG Eurobank Securities.
Some analysts think the refining margins, too, might show some improvement in the third quarter.
“We expect Petrom to have a very good third quarter like the previous quarter was and much better than the third quarter of last year. The production segment should benefit from the high oil price,” says Thomas Unger, Erste Group analyst. Erste also expects profitability of the refining and marketing segment to improve as a result of the higher sales, which are typical of this period.
Analysts believe Petrom’s profit will be positively influenced by the depreciation of the leu against the dollar, as converting the oil price in dollars as used on the international market in lei should give the company more lei to the dollar.
ING’s analyst Tamas Pletser expects exploration and production profit to be somewhat lower quarter to quarter, while the profit of the refining and market segment will be much lower (as margins were really low). He says that “it is unlikely that the four quarter will be better than the third, but it won’t be significantly weaker, though,” because the oil price remains high, the exchange rate has stabilized and the increase in gas prices may help the company.
Tradeville analysts do not see the company posting the good results of 2011 because of the uncertainty surrounding the economy.
“We expect Petrom to post about RON839 million profit in the third quarter because the profit margin is expected to have maintained at the same level as in the first half,” said Ovidiu Dumitrescu, Tradeville analyst.
“On the other hand, we believe sales will start being affected by the uncertainty surrounding the economy. In our opinion, 2012 will be much less spectacular both in terms of margins and in terms of sales, but will be a starting point for the strategic change the company is considering. We expect the results of the strategy to become visible as of 2013-2014.”
(EUR1=RON4.2, January-September, EUR1=RON4.25 July-September)