3rd Quarter Results
OAO Novatek
NOVATEK ANNOUNCES THIRD QUARTER AND NINE MONTHS 2009 IFRS RESULTS
Moscow, 13 November 2009. OAO NOVATEK today released its
consolidated interim condensed financial information for the three and
nine months ending 30 September 2009 prepared in accordance with
International Financial Reporting Standards (“IFRS”).
IFRS Financial and Operational Highlights
(in millions
of Russian roubles)
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3Q 2009
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3Q 2008
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9M 2009
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9M 2008
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Revenues
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21,217
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19,437
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Oil and gas sales
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59,909
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60,015
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475
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561
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Sales of polymer and insulation tape
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1,373
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1,692
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279
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465
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Other revenues
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818
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984
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21,971
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20,463
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Total revenues
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62,100
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62,691
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(13,638)
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(11,936)
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Total operating expenses
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(40,055)
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(34,781)
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-
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-
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Net gain (loss) on disposal of interest in subsidiaries
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52
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-
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25
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(11)
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Other income (loss)
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(128)
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(190)
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8,358
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8,516
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Profit from operations
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21,969
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27,720
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903
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(976)
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Finance income (expense)
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(902)
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(815)
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9,238
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7,506
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Profit before income tax
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21,039
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26,804
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7,277
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5,686
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Profit (loss)
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16,579
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20,241
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7,353
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5,682
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Profit (loss) attributable to OAO NOVATEK shareholders
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16,665
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20,238
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2.43
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1.87
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Basic and diluted earnings per share
(in Russian roubles)
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5.50
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6.67
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In the third quarter 2009, our total revenues grew by 7.4% to RR 21,971
million compared to the corresponding period of 2008, primarily due to
an increase in both natural gas prices and stable gas condensate and LPG
sales volumes.
Profit attributable to NOVATEK shareholders in the third quarter
increased by 29.4%, to RR 7,353 million, or RR 2.43 per
share, as compared to the corresponding period in 2008, and was
primarily due to higher revenues and a non cash foreign exchange gain
during the 2009 period, as well as a decrease in the statutory tax rate
from 24% in 2008 to 20% effective as of 1 January 2009.
In the nine months ended 30 September 2009, our total revenues decreased
marginally to RR 62,100 million as compared to the corresponding period
in 2008. The marginal decrease in revenues was primarily due to
significantly higher prices for liquids sales volumes in both
international and domestic markets in the 2008 period, which were offset
by higher natural gas prices and an increase in liquid sales volumes
during the 2009 period.
Profit attributable to NOVATEK shareholders in the nine months ended 30
September 2009 decreased by 17.7% to RR 16,665 million, or RR 5.50 per
share, due to the higher liquids prices in the 2008 period, which were
offset by higher liquids volumes in the 2009 period and an increase in
transportation expense in the 2009 period due to a change in the sales
mix of our natural gas customers from ex-field to end-customer sales.
Selected Operating Highlights
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3Q 2009
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3Q 2008
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Production and Purchased Volumes
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9M 2009
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9M 2008
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7,756
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7,531
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Natural gas production
(million cubic meters)
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23,492
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22,487
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250
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757
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Natural gas purchases
(million cubic meters)
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699
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2,105
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8,006
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8,288
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Total natural gas production and purchases
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24,191
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24,592
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738
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633
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Liquids production (thousand tons)
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2,206
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1,861
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6
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24
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Liquids purchases (thousand tons)
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6
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94
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744
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657
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Total liquids production and purchases
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2,212
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1,955
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3Q 2009
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3Q 2008
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Sales Volumes
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9M 2009
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9M 2008
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7,763
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8,226
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Natural gas (million cubic meters)
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24,030
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24,596
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467
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329
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Stable gas condensate (thousand tons)
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1,518
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1,153
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189
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153
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Liquefied petroleum gas (thousand tons)
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533
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461
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48
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63
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Crude oil (thousand tons)
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149
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212
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3
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32
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Oil products (thousand tons)
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9
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99
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In the third quarter and nine months of 2009, our total consolidated
natural gas and liquid hydrocarbon production grew mainly due to an
increase in production at our Yurkharovskoye field as a result of the
completion of a production capacity expansion project which was launched
in September 2008.
In the third quarter and nine months of 2009, our natural gas sales
volumes decreased by 5.6% and 2.3%, respectively, primarily due to a
reduction in our purchases from third parties, as a result of our
ability to meet domestic market demand from our own production, and an
increase in natural gas inventories, whereas our liquids sales volumes
grew by 22.5% and 14.8%, respectively, primarily due to the increase in
unstable gas condensate production at our Yurkharovskoye field.
At 30 September 2009, we had 202 thousand tons of stable gas condensate
in transit or storage and recognized as inventory until such time as it
is delivered to the port of destination as compared to 216 thousand tons
as of 30 September 2008. We also recorded 503 million cubic meters of
natural gas as inventory at 30 September 2009 compared to 267 million
cubic meters as of 30 June 2009.
“Our third quarter results continue to demonstrate our ability to adapt
to difficult market conditions and capitalize on our operational
strengths” stated Leonid V. Mikhelson, CEO NOVATEK. “Throughout 2009, we
have shown that the timely investments in infrastructure and production
capacity over the past few years allowed us to continue to grow our
business and deliver sustainable value to our shareholders”
Selected Balance Sheet Items
in millions of Russian
roubles)
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30 September 2009
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31 December 2008
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ASSETS
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Non-current assets
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165,073
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113,578
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Property, plant and equipment, net
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159,789
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108,714
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Total current assets
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18,130
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25,428
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Total assets
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183,203
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139,907
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LIABILITIES AND EQUITY
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Non-current liabilities
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30,995
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28,763
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Long-term debt
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17,986
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19,935
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Current liabilities
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24,938
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14,169
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Total liabilities
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55,933
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43,267
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Equity attributable to
OAO NOVATEK shareholders
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107,896
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96,069
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Non-controlling interest
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19,374
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571
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Total equity
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127,270
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96,640
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Total liabilities and equity
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183,203
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139,907
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The full set of consolidated interim condensed IFRS financial
information, the notes thereto and Management’s Discussion and Analysis
of Financial Condition and Results of Operations are available on the
Company’s web site (www.novatek.ru).
***
Certain statements in this press release are not historical facts and
are “forward looking” within the meaning of Section 27A of the
Securities Act and Section 21E of the US Securities Exchange Act of 1934
(hereinafter, the Exchange Act). Forward looking statements include
statements concerning our plans, expectations, projections, objectives,
targets, goals, strategies, future events, future revenues or
performance, capital expenditures, financing needs, plans or intentions
relating to acquisitions, our competitive strengths and weaknesses,
plans or goals relating to forecasted production, reserves, financial
position and future operations and development, our business strategy
and the trends we anticipate in the industries and the political and
legal environment in which we operate and other information that is not
historical information. By their very nature, forward looking
statements involve inherent risks and uncertainties, both general and
specific, and risks exist that the predictions, forecasts, projections
and other forward looking statements will not be achieved.
For further information, please visit www.novatek.ru
or contact:
***
OAO NOVATEK is Russia’s largest independent gas producer and the
second-largest natural gas producer in Russia. Founded in 1994, the
Company is engaged in the exploration, production, processing and
marketing of natural gas and liquid hydrocarbons. The Company’s upstream
activities are concentrated in the prolific Yamal-Nenets Region, which
is the world's largest natural gas producing area and accounts for over
90% of Russia's natural gas production and 20% of the world’s gas
production. NOVATEK is an open joint stock company established under the
laws of the Russian Federation. The Company’s shares are listed on the
Russian Trading System (RTS) and the London Stock Exchange (LSE) under
the ticker symbol ‘NVTK’ and on the NASDAQ PORTAL System as Rule 144A
GDR under the ticker symbol “NVATY”.
