The revenue of the Petroleum Industry of Serbia (NIS) in the first nine months of this year decreased by 20.1 percent to 304.1 billion dinars, primarily due to a 22 percent reduction in the average price of crude oil, as well as lower turnover compared to the previous year, announced the brokerage firm Momentum Securities today.
The company’s profit, before deducting depreciation, interest, and income tax expenses (EBITDA), weakened by 46.1 percent to 56.6 billion dinars, mainly due to the drop in oil prices and the effect of “expensive inventory.”
The net profit decreased by 54.3 percent, primarily due to the negative impact of the donation (60 million euros) to the Serbian government, implemented in the second quarter.
Oil and gas production decreased in the first nine months compared to the previous year by 1.3 percent, and refining by six percent. The total turnover of oil derivatives decreased by seven percent. Looking only at the third quarter, turnover stabilized and recorded a one percent decline.
In June, NIS officially became the majority owner of Petrohemija, increasing its ownership stake from 20.9 percent to 90 percent through a capital increase of 150 million euros.
According to the signed agreement, these funds will be used to build a polypropylene production plant. Petrohemija had a decline in most financial and operational indicators in the third quarter, with a net loss of 2.6 billion dinars during that period.
NIS recently announced an ambitious plan for capital investments (CAPEX) for the next year, which could reach a record level since the company’s privatization. This year’s CAPEX is planned at just under 50 billion dinars, mostly in the exploration and production segment, while next year’s investment in this regard is expected to be just under 60 billion dinars.
“For next year, regular maintenance is planned at the Pančevo Refinery, but even without this intervention, there is a clear intention for increased capital investments that deviate from the trends among major global players who are still nowhere near the investments from the period before the oil crisis in 2015,” Momentum stated.
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