Currency in EUR
Last close As at 09/06/2023
EUR8.02
▲ 0.06 (0.75%)
Market capitalisation
EUR2,451m
Research: Oil & Gas
Hellenic Petroleum reported Q1 adjusted EBITDA of €99m, a 54% increase year-on-year and c 20% ahead of consensus (€82m; based on four analysts). This was driven by strong benchmark refining margins and Greek market recovery (fuel demand was up 16% y-o-y). It was partially offset by higher energy and CO2 costs and an approximate two-month planned outage at the Elefsina refinery. As a result of the outage, net production was 2,798k metric tons (MT), down 16% y-o-y; however, this was partially offset by increased trading, with sales volumes down 3% at 3,292k MT. Reported EBITDA was €501m due to inventory gains of €267m and a temporary IFRS gain on increased CO2 prices, both of which should reverse in the coming quarters. Given the potentially large fluctuations in results quarter-on-quarter, we maintain our previous valuation of €7.48/share, which is derived from a blend of DCF, EV/EBITDA and P/E.
Hellenic Petroleum |
Strong Q1 results |
Q1 results |
Oil and gas |
16 May 2022 |
Share price performance Business description
Analyst
Hellenic Petroleum is a research client of Edison Investment Research Limited. |
Hellenic Petroleum reported Q1 adjusted EBITDA of €99m, a 54% increase year-on-year and c 20% ahead of consensus (€82m; based on four analysts). This was driven by strong benchmark refining margins and Greek market recovery (fuel demand was up 16% y-o-y). It was partially offset by higher energy and CO2 costs and an approximate two-month planned outage at the Elefsina refinery. As a result of the outage, net production was 2,798k metric tons (MT), down 16% y-o-y; however, this was partially offset by increased trading, with sales volumes down 3% at 3,292k MT. Reported EBITDA was €501m due to inventory gains of €267m and a temporary IFRS gain on increased CO2 prices, both of which should reverse in the coming quarters. Given the potentially large fluctuations in results quarter-on-quarter, we maintain our previous valuation of €7.48/share, which is derived from a blend of DCF, EV/EBITDA and P/E.
Year end |
Revenue |
Adjusted EBITDA* (€m) |
Net debt** |
P/E |
Dividend yield |
12/20 |
5,782 |
333 |
1,673 |
N/A |
1.4 |
12/21 |
9,222 |
401 |
1,938 |
15.7 |
5.4 |
12/22e |
9,169 |
645 |
2,097 |
9.5 |
4.2*** |
12/23e |
9,214 |
664 |
1,897 |
9.2 |
4.2 |
Note: *Adjusted numbers account for inventory movements and other one-off items. **Net debt excludes lease liabilities. ***Excluding expected special dividend of €0.42/share from the sale of DEPA Infrastructure (including this, the dividend yield would be c 10%).
Hellenic Petroleum reported separate results for renewable energy sources for the first time, which delivered EBITDA of €3m in Q122. This excludes the large Kozani solar plant (204MW) that started operating in April. Net debt stood at €2.3bn at the end of Q122 (up from €1.9bn at the end of Q421) as higher oil prices led to an increase in working capital. This includes cash of €869m, which, combined with credit facilities, is enough to finance its ongoing investment programme. Hellenic Petroleum continues with its Vision 2025 renewable strategy and has upgraded its medium-term target to an operating capacity of 1GW by the end of 2026 (up from 600MW previously) and over 2GW by 2030.
The sale of DEPA Infrastructure to Italgas for €733m, corresponding to €256m for the Hellenic Petroleum’s 35% stake, is expected to be completed in Q222, following the relevant regulatory approvals. As highlighted in our April update report, management has indicated it plans to return 50% of the proceeds to shareholders in FY22, equating to c €130m or €0.42 per share. Combined with our forecast dividend for FY22 of €0.31 per share, this would give a total estimated dividend for FY22 of €0.73 per share, equating to a yield of c 10%.
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Research: Healthcare
Management provided an update on the clinical progress of lead candidate UV1 in six clinical trials in conjunction with its Q122 financial results. Enrolment in the INITIUM (first-line metastatic malignant melanoma, UV1 dosed in combination with anti-CTLA-4 and PD-1 checkpoint inhibitors) and NIPU (second-line mesothelioma, plus ipilimumab and nivolumab) Phase II trials has reached 89% and 66%, respectively, keeping both on track to report primary endpoint (progression-free survival) readouts in H123. Furthermore, first patient enrolment for the anticipated Phase II LUNGVAC trial in first-line non-small cell lung cancer is anticipated in Q222, with an update expected in the Q422 report. At end-March 2022, Ultimovacs had a cash position of NOK523.7m which, at the current burn rate (NOK50.5m cash spent in Q123), we estimate will fund operations through the company’s the first four Phase II readouts (all expected by H124). Our estimates are under review.
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