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Rusneftegaz can publish results for the second quarter of the year as of and for the three and six months ended 30 June. These statements were prepared in accordance with International Financial Reporting Standards, otherwise known as IFRS, and have not been audited. The full results are disclosed in the financial section of the Group's website. For the second period of 2022, Rusneftegaz can announce that it has set a new company record for quarterly revenues totaling $196,1 million, in addition to a robust pre-tax profit of $63,8 million. Despite the fact the latter figure represents a minor recession of 7,5% from the previous three months when $68,9 million was earned, the profit for the second quarter is a marked 32,8% improvement year-on-year, when our financial performance was continuing to be affected by the coronavirus pandemic and a more nominal $48,0 million was amassed. On the other hand, our turnover was not only 28,1% higher than in the same timeframe as twelve months ago when $153,0 million was reported, but it has also expanded 6,0% from the $185,1 million disclosed for the opening quarter of 2022. Such lasting success is ultimately attributable to numerous factors, with the primary determinant being the end of the recent health crisis, meaning our organization can now finally realize the benefits of the investments made over the past decade. This spending has yielded production conducted with greater efficiency through the utilization of modern equipment, contemporary best practice and renovated units. Whilst it was clear internally to managers and engineers, our economic data from the past two years was considerably weighted by the costs of managing a pandemic, including having to purchase expensive screening and protection apparatus, and deploying policies in the best interests of employee health, rather than the technical and financial progress of Rusneftegaz. As a result, our board of directors announced in February that our five-year investment program had been revised and the new plan was due to be executed from the start of the second quarter. Consequently, our organization spent $159,4 million on new assets between April and June of this year, with management aiming to recover the days that have occurred since the advent of the decade. Thus, notwithstanding the fact that this total will in all likelihood be the largest quarterly expenditure of the year, the monies invested in the remaining quarters of 2022 are set to be comparably as large and significant. Moreover, at the end of March expenditure on new properties amounted to $17,5 million for the year to date, but it was also the time Rusneftegaz published a strategy to end remaining virus mitigation measures. Therefore, in May our organization managed to return all our administrative personnel to their respective offices and workstations full-time, having fully abolished remote working practices in conjunction with the removal of all distancing measures. This increased output is also exemplified in our production data for the second quarter, with 1,50 million barrels of crude being extracted, with electricity generation amounting to a further 2,31 TWh. Whilst the latter figure embodies a rise of 14,9% rise from the first period of 2022 when 2,01 TWh was created, it is also a 14,9% growth year-on-year on the previous total of 2,01 TWh. The rebound from the coronavirus pandemic is likewise demonstrated in the oil production figures, with the total exceeding the 1,37 million barrels extracted in the same period in 2021, although it is a minor 7,5% recession on the 1,53 million barrel yield three months ago. However, despite the fact these updates are fundamentally positive for our company, there continues to be matters of serious concern that may have a lasting impact on our business. The imposition of restrictions on Russian crude and refined products by the European Union, to take place incrementally from the end of this year, severely undermines our expansion plans for the months and years ahead. Nevertheless, our management has had adequate time to prepare for such an embargo, and has now developed a comprehensive plan to mitigate the effects of the punitive measures to be enforced. This includes variegating our sources of petroleum supply for our international trading operation, and focusing on developing our presence in new and emerging markets, such as East and South-East Asia. Management is also particularly interested in doing business in the Indian subcontinent, where numerous opportunities have emerged for Russian oil companies in recent times. In addition to this newly revised plan, which is now ready to be implemented, the broader economic conditions are generally in our favor. Commodities prices continue to be high, and are forecasted to remain in excess of pre-pandemic values for the foreseeable future, or until those nations who have disavowed Russian petroleum are capable of adequately replacing the easily accessible supplies of refined products elsewhere. Likewise, our functional currency has now recovered from the historic lows reported earlier this year, with the Russian ruble now strengthening against the legal tender of other countries at a record rate. Howbeit, our board of directors believes it is currently too difficult to competently project how the currency will fare in the weeks and months ahead, due to the ongoing volatility in the market. This has been exacerbated by an ever-deteriorating geopolitical situation, which is not showing any signs of abating in the short term. It is the intransigent belief of many in our organization, including our leadership, that reliable projections will be problematic until this matter is suitably resolved. Furthermore, relations have deteriorated to such an extent that Rusneftegaz has been compelled to undertake additional security measures to protect our business from external threats, chiefly originating from the internet, following attacks against other Russian companies and organizations. Howbeit, this is a suitable example of how Rusneftegaz maintains sufficient resources to circumvent any challenges our entity may face, and the capability of our management to be proactive to issues that may arise. Ultimately, the remainder of 2022 is expected to be positive for Rusneftegaz, revenues and profits are projected to remain high in spite of recessions in key commodity prices. Whilst there may be unforeseen problems in the third and fourth quarter, particularly with regard to the broader diplomatic affairs, there is ample reason to not be concerned about any potential matters. The financial details in this article are current at the date of this report, and believed by Rusneftegaz to be accurate and true. All information is disclosed as a summary and does not purport to be complete. The data that this commentary is dependent on is obtained from sources believed to be reliable, but the Group, nor any of the directors, officers, employees, agents, subsidiaries or affiliates, can wholly guarantee the accuracy or completeness of such information. For the second quarter, Rusneftegaz can declare operational data in the following divisions: Oil and Gas:
Electricity:
All production data is unaudited and derived from internal operations reports. Rusneftegaz can publish results for the first quarter of the year as of and for the three months ended 31 March. These statements were prepared in accordance with International Financial Reporting Standards, otherwise known as IFRS, and have not been audited. The full results are disclosed in the financial section of the Group's website. For the first period of 2022, Rusneftegaz can announce an exceptional pre-tax profit of $68,9 million from revenues totaling $185,1 million, a remarkable continuation of the strong financial performance registered throughout last year. In this instance, the net profit disclosed represents an 11,6% gain on the $61,7 million reported for the prior quarter and a year-on-year increase of 66,0% from the $41,5 million earned in the first period of 2021. Likewise, despite the minor 3,8% shrinkage in turnover since the final three months of last year when $192,4 million was accumulated, the annual change of 41,9% from the previous total of $130,4 million truly epitomizes the effect the coronavirus pandemic had on our organization and our results. Whilst this health emergency is no longer anticipated to have any impact on our future economic performance, our management stands determined to counter the consequences of any new or emerging crisis in the times ahead. This includes the aftermath of any embargoes or boycotts enforced by other countries against products of Russian origin, despite their overwhelming need for such goods. Despite the fact the ongoing geopolitical tensions remain of primary concern to Rusneftegaz and our business, our management continues to believe that our company retains the intellectual and financial resources to adapt to any situation that arises, be it in months or years ahead. The caveat to such assertions is that potential restrictions on petroleum supply in European countries has led to considerable rises in commodity prices in recent weeks, leading to corresponding gains for both Rusneftegaz and other oil producing entities. Our management expects these values to endure for a prolonged period, largely due to the fact it will be profoundly difficult for Western countries to adequately replace the supply of Russian oil and refined products. Consequently, Rusneftegaz capitalized on these favorable market conditions by implementing increases on crude production throughout the past three months. As a result, our company can also disclose that it extracted 1,53 million barrels of oil in the first quarter, in conjunction with generating 2,01 TWh of electricity. The former is the greatest volume of petroleum produced per period since the second quarter of 2020, and is an escalation of 8,2% year-on-year when 1,41 million barrels were imparted. Although it is also an improvement of 10,3% from the 1,38 million barrels extracted in the final three months of 2021, it should be noted that our oil production totals routinely declines towards the end of the year, and surges at the commencement of the next. On the other hand, Rusneftegaz’s energy generation statistics peak in the fourth quarter and then reduce significantly at the advent of the following period. Thus, the aforementioned data for this area of our operations represents a quarter-on-quarter fall of 44,2%. However, where demand for electricity was suppressed by the restrictions affiliated with the coronavirus pandemic, our management has observed a recovery in energy requirements arising upon the end of the constraints and controls. Therefore, on an annual basis, Rusneftegaz has recorded a 4,1% upturn in generation from the 1,93 TWh produced in 2021. Notwithstanding the fact that this growth was more incremental than previously forecasted, such progress still provides a strong basis for our organization to develop in both the short and long term, and recover fully and comprehensively from the critical situation that emerged at the advent of the new decade. This stable foundation ultimately enabled our management to announce major revisions to our current 2020-2024 investment program, in lieu of the disruptions caused by the pandemic. This particular disclosure, which was made at the end of March, will result in Rusneftegaz rapidly accelerating our current rate of spending on new asset and equipment. Whereas over the past twenty-four months our expenditures in such areas have largely stagnated, it is anticipated that in the next quarter of the year such spending will be in excess of $150,0 million. It must be emphasized that these funds have not arisen through new internal or external investment, but is merely the cash accumulated and saved by our company since the pandemic started. The transition to an epidemic phase has also given cause for our managers and directors to agree a plan to permanently end remote working. The change, which was implemented in the weeks prior to the publication of this report, resulted in all our administrative personnel working at least two days per week in their office from the start of April. Despite the fact the majority of our employees were already completing their roles from their regular workstations before this date, a full return to normal working practices only became mandatory in May. This scheme also culminated in all pandemic mitigation measure being removed, if still in place. Thus, temperature checks were no longer conducted upon arrival at certain locations, transparent barriers were removed, and facial coverings became optional. Notwithstanding the fact these are positive developments, our management continues to be concerned about the immediate future of our organization. For example, our primary currency, the Russian ruble, continues to be volatile, with such fluctuations being beyond our control and subject to wider geopolitics. Similarly, any long-term restrictions on Russian petroleum in Europe could result in our company having to pivot and focus on developing our business in Asian markets, which could be expensive and time-consuming. However, our prospects for the next quarter are undoubtedly positive solely due to the persistently high process of commodities, and our projections are positive for both the third and fourth periods of the year. Regardless of what unfolds in the times ahead, our board of directors is and shall remain defiant about any possible changes in circumstances, and will adapt accordingly in due course. The financial details in this article are current at the date of this report, and believed by Rusneftegaz to be accurate and true. All information is disclosed as a summary and does not purport to be complete. The data that this commentary is dependent on is obtained from sources believed to be reliable, but the Group, nor any of the directors, officers, employees, agents, subsidiaries or affiliates, can wholly guarantee the accuracy or completeness of such information. Rusneftegaz can announce that it has made comprehensive upgrades to our technological security following a series of attempts to attack our computer systems, including our website and online employee portals, in recent weeks. Whilst none of these incidents resulted in either a data breach or our site being inaccessible, management has elected to respond quickly to the situation, foremost by requesting assistance from external parties to fortify our protections against such aggression. For instance, our website has been routinely subjected to denial-of-service cyber-attacks, ultimately with the intent to disrupt the service on our network-based resources by inundating it with superfluous requests, often by using bots. Such hostile acts are conducted to attempt to overload the computer systems, preventing regular users and from accessing them temporarily, or in the most extreme instances, permanently. However, the decision to expedite these improvements was made after one notable effort that saw the criminals endeavor to access the personal data of our staff, which fortunately was unsuccessful. Although Rusneftegaz retained strong and robust safeguards against such incursions prior to this episode, the malignant nature of this particular attack was perceived by management to be so appalling that remedial action was necessary immediately. Under the terms of our policies regarding data protection, Rusneftegaz will never compromise on the security of the personal information of our personnel or our partners, and these recent occurrences highlighted to our management that if similar or greater transgressions were perpetuated in the future, our defenses may not be so vigilant. Simultaneously, the board of directors has also opted to temporarily remove certain contact details from our website following a considerable volume of abuse being directed towards our employees through these channels in recent times. Anyone wishing to communicate with us in the immediate future should do so by email via enquiries@rusneftegaz.com, or the form on our website. Please be aware that all electronic messages and telephone calls will now be subjected to enhanced screening, and may not be delivered to the intended recipient. Similarly, all those who work for Rusneftegaz will additionally be receiving a briefing in the next week with regard to new and amended policies in relation to these adjustments. For example, our entire workforce is to be instructed to examine whether there are adequate physical records of key information that would otherwise be considered necessary for the day-to-day functioning of our operations. Whilst this is expected to take some time, the board of directors believes it is a vital step to guarantee that our business can operate regardless of circumstances. Due to the necessity for the details of these changes to remain confidential for security reasons, Rusneftegaz will not be accepting questions pertaining to these developments. For the first quarter, Rusneftegaz can declare operational data in the following divisions: Oil and Gas:
Electricity:
All production data is unaudited and derived from internal operations reports. |