The company’s bottom line could have been even stronger, but a financial negative result of 283 million lei (EUR67.7 million) hurt the final figure.
“The results were good, coming mainly on rising crude oil prices and cost management, but the company felt the negative impact of risk hedging and the low refining margins,” explained Mariana Gheorghe, Petrom chief executive officer.
An analysis of the company’s figures along its three business segments – exploration and production, refining and marketing, gas and energy – confirm that hydrocarbon exploitation is still the main profit driver. “For the first time since privatization, Petrom has had four consecutive quarters of rising hydrocarbon production,” mentioned Gheorghe. Thus, the company’s first-half oil and gas output was 2% higher from last year.
On the refining and marketing segment, Petrom’s figures were harmed by the still falling fuel demand. On the other hand, sales were spurred by rising pump prices.
As regards the electricity segment, Petrom says it started tests in June for the EUR500 million gas-fuelled station it is building in Brazi and that it has already fitted 13 of the 15 turbines of the wind farm it is constructing in Dobrogea. “We’ll start commercial operations on the electricity segment by yearend,” said Gheorghe.
Petrom’s foray in electricity generation comes at a moment when the financial market turmoil is likely to impact electricity demand again. “Directly or indirectly, what’s happening now internationally will also influence Romania as we will see an impact over oil prices, the exchange rate, but also over fuel and electricity demand,” Gheorghe also said.
Going back to the moves Romania should make, Petrom CEO calls for caution. “Romania’s economic growth was primarily triggered by rising exports. Should the crisis hurt this frail recovery, finding other markets outside the Western one is a very difficult mission,” she said.
“In the case of any manager, cost control is mandatory. As a government, you cannot manage a global economy, but public cost control is mandatory,” she added.
(English version by Catalina Apostoiu; Editing by Radu Bostan)