Galp Energia SGPS (GALP) Q4 2012 earnings summary

Executive summary

• FY12 EBITDA was €1,015M, up 27% YoY; net profit was €359M, up 43%. 4Q12 EBITDA reached €229M and net profit €83M, each up 10% YoY.

• Production growth in Brazil and higher refining margins supported 4Q EBITDA; portfolio additions and appraisal results advanced exploration plans.

Financial highlights

• FY12 turnover was €18,507M; EBITDA €1,015M, up 27%; EBIT €584M, up 48%; net profit €359M, up 43%.

• 4Q12 turnover was €4,231M, down 3% YoY; EBITDA €229M, up 10%; EBIT €142M, up 33%; net profit €83M, up 10%.

• IFRS net profit was €343M for FY12, down 21% YoY; 4Q12 IFRS net profit was €13M, down 72%.

• FY12 associates contributed €72M, down 1%; financial results were a €63M expense, up 49%; taxes were €182M and minority interests €53M.

Outlook and guidance

• 1Q13 working-interest production targeted at ~24 kboepd; Lula NE production expected to start in 2013 with one producing well.

• Lula project production ramp-up expected over 18 months, with 2013 exit production targeted at ~75 kboepd.

• Sines hydrocracker production expected to reach maximum capacity in 1Q13, with full refining-margin impact in 2Q13.

• Mamba appraisal drilling expected to conclude in 1H13; 2013 exploration included Namibia wells and the K Bulge prospect after appraisal work.

• Marketing volumes expected to decline YoY amid Iberian conditions; natural-gas volumes expected to rise QoQ on stronger LNG trading.