Q1 2024 results point to another above mid-cycle refining margin year. Volumes, EUR/USD, opex and RES contribution are all supporting our adjusted (total) EBITDA FY24 of E1.0bn for Helleniq and E1.3bn for MOH. Which may be lower yoy but big enough to finance the ongoing earnings diversification and solid dividends.
Conclusion. Our preference for MOH has not changed. Its latest move to acquire Ellaktor’s waste management business (Helector), will be a great deal both in financial* and strategy terms. It reminds us MOH is a few steps ahead in diluting the weight of refining in EBITDA below 50%.
Greek Refineries: Above Mid Cycle; Prefer MOH
May 30th, 2024Motor Oil: Doing Stuff
April 9th, 20242023 was the second consecutive year with ref margin >$18/bbl, EUR/USD below 1.10 and vol @ 13.4m tn or higher. MOH generated EBITDA of E1.48bn o/w E1.18bn from refining. Still, Q4 EBITDA was below our estimate by -15%/E63m on -14% lower vol and $2/bbl lower margin (gasoline crack).
But FY cash flow of E496m was in line with our estimates, on lower working capital and taxes. This is a 16.6% yield against market cap. MOH announced a record E1.8 DPS (RGe E1.7) on a 25% payout, implying a 6.6% yield on current market cap (incl. E0.40 interim).
Motor Oil: Higher for Longer
November 27th, 2023Q3 was impressive, with the 9M adjusted EBITDA (E1.1bn) at 90% of our FY 2023 estimate. Refining margin of $22/bbl x 3.9m tn x 1.09 EUR/USD pushed clean EBITDA at E538m in Q3, higher than E155m in Q2 (lower margin, lower vol), but even higher than E447m in Q1. Jet, gasoline, and diesel cracks rebounded back to Q1 levels with the naphtha reformer leading to higher gasoline production. Equity cash flow at E488m/E745m in Q3/9M pushed net debt significantly lower at E1.2bn (from E1.8bn in Q4 2022).
Greek Equities Update June 2023
June 22nd, 2023’If you cannot explain it simply, then you do not understand it well enough.’’ Testing ourselves, we share our understanding of each Greek investment case we cover within a few lines.
Conclusions: Our base case scenario is materializing, i.e., Mitsotakis administration renewing its mandate and Greece avoiding a recession. Equities have re-rated and are +36% YTD, so now…
Greek Refineries: Is The Party Over?
June 1st, 2023What’s new? Q1 2023 results showed refining margins remain at super high levels of $21-$22/bbl keeping quarterly clean EBITDA at E400m-E450m. Low/reversed working capital resulted to solid cash flow conversion (E230m FCFE MOH, E540m ELPE) with both companies reporting lower net debt qoq (