MOL Group says Q3 results affected by fuel price regulations and windfall taxes

Today, MOL Group announced its financial results for the third quarter of 2022. Supported by the strong Upstream and Downstream performance, driven by the macroeconomic factors, Clean CCS EBITDA resulted in 1.4 billion USD in Q3 2022. This result brought Q1-Q3 2022 EBITDA to 3.6 billion USD that allows MOL to further upgrade full year EBITDA guidance range to 4.1-4.4 billion USD. At the same time, windfall taxes and fuel price regulations across the CEE region hit MOL operations by approximately 1.18 billion USD in Q1-Q3 2022.

Chairman-CEO Zsolt Hernádi commented the results: „While macro conditions evolved favourably for the oil and gas industry in the first nine month of the year, the uncertain external environment, the looming recession, the state interventions and windfall taxes cast uncertainty over the industry. European sanctions seems to determine the economic future of Europe, the third quarter of 2022 proved to be very tight in terms of energy supply in the Central Eastern European region. So far we managed to maintain stable fuel supplies in several CEE countries, I consider it as our biggest achievement in this quarter thanks to the extraordinary efforts of MOL’s employees. We will need our colleagues’ commitment in the future as well as we need a disciplined financial approach to deliver the upcoming transitional investments to guarantee energy security, to switch from Russian energy sources and not to lose sight of the green transition. We took a major step on our 2030+ roadmap: MOL was awarded with a concession for municipal and communal waste management services covering a period of 35 years in Hungary, allowing us to expand in a new, low-carbon, circular economy business.”

Upstream EBITDA almost doubled year-on-year to USD 640mn in Q3 2022, year-to-date delivery stood at USD 1.72bn that represents almost half of the Group’s total EBITDA. The main driver of the strong result in Q3 were the macro indicators that were able to offset the negative impact of extra royalties in the last quarter. Oil and gas production volume exceeded 90 mboepd in Q3 2022 while in the first 3 quarters it reached an average of 92.3 mboepd, surpassing the annual 90 mboepd production guidance. Group unit OPEX remained under 5 USD/boe, despite significant cost pressure across the value chain.

Downstream Clean CCS EBITDA increased year-on-year and reached USD 741mn in Q3, but decreased by 14% compared to the previous quarter.  Price regulations and windfall taxation in CEE hit the segment’s profitability  in Q3 2022 and petchem EBITDA decreased by 90% year-on-year, but strong R&M contribution offset the negative drivers. The planned major maintenance of the Százhalombatta refinery was successfully completed in the Q3 period.

Consumer Services Q3 2022 EBITDA decreased by 43% year-on-year, and more than halved if we compare the first 3 quarters with last year’s Q1-Q3 period. Fuel price regulatory measures in several CEE countries affected the results,the segment’s EBITDA decreased by USD 85mn due to fuel price caps in the CEE region. Non-fuel margin improvement and sales volume increase partly mitigated the negative drivers. The number of Fresh Corner sites rose to 1,130 in Q3 2022 from 1,103 in Q2 2022.