HELLENIC PETROLEUM SA, following Hellenic Capital Market Commission’s letter on 18/11/2020 regarding the accurate and timely information on the implications of COVID-19 pandemic outbreak in the operation of the listed companies trading on the regulated market of the Athens Stock Exchange and, following up on the 9M 2020 financial results of 05/11/2020, announces:
Business environment – Impact on Economic Results
The COVID-19 pandemic had a significant negative impact on the international oil market, with a decline in global demand at -8% (est.) for the 9M 2020, a negative impact on crude oil prices (-37% avg yoy), but also on refining margins, which is the key factor influencing the Group’s profitability.
In terms of 3Q20, the unprecedented impact of the COVID-19 pandemic continued to affect both Greece and the global market, the decline of benchmark refining margins averaged at negative levels, combined with the demand drop in the domestic fuels market and the strengthening of the euro, resulting to the worst international refining backdrop in history. In addition, a major challenge was the need for additional health and safety measures in facilities and offices due to the pandemic.
Domestic demand was affected mainly by the reduced economic activity in sectors like tourism, where the pandemic and measures to control it had a negative impact. More specifically, domestic ground fuels demand was 8% lower y-o-y, at 1.5m MT. The decline was larger in the aviation and marine fuels market (-49%), with aviation fuel demand recovering q-o-q, however remaining materially lower vs 3Q19 (-63%).
Despite the adverse conditions, the Group ensured the smooth operation of its three refineries by maintaining high operating levels and increasing exports, while taking advantage of any commercial opportunities in the international market in order to mitigate - to the extent possible - the effects of the adverse environment.
Liquidity – Financial Position
The Group continued to improve its capital structure, drawing additional liquidity, from both international capital markets as well as the Greek banking system, with very favorable terms. On 12 October 2020, HPF plc, a fully owned subsidiary of HELLENIC PETROLEUM, completed a €99.9m retap on its existing Oct ’24 notes, through private placement, with a 2.4% yield. In addition, during 4Q20, the Group is concluding the refinancing of €900m of credit facilities maturing in the next 6 months, further improving its debt maturity profile.
Financing cost remains at the lowest levels in recent years, down 14% in 3Q20, at €78m.
COVID-19 Pandemic Management Measures
In this environment, HELPE Group’s main priorities are the safety of its staff and contractors at its facilities, the smooth operation and supply of the market, as well as financial liquidity, so that it can both successfully overcome the current situation, as well as to continue the implementation of its strategy.
From the beginning of the pandemic, the Group’s response was immediate by:
- Establishing a Policy on prevention and management of issues arising from the COVID-19 pandemic, including detailed prevention guidelines and a Crisis Management Committees in all its facilities
- Set up of reserve working teams and modification of shift programs
- Remote working model (teleworking) >70% for office staff
- Utilizing digital technology and upgrading teleworking infrastructure
- Continuous information for personnel, along with ongoing health support (medical network, psychological support line)
- Increased hygiene and safety measures: temperature measure, frequent disinfection, use of masks and safety distance, as well as regular provision of masks and disinfectants
- Conducting c. 23,000 molecular and rapid COVID-19 tests to personnel and contractors from the beginning of the crisis until today
The Group responded in real time, to the growing needs of the COVID-19 pandemic with a large program of 8 million euros, to support the National Health System, in full cooperation with the relevant Ministries and Hospital Administrations.
In addition, HELLENIC PETROLEUM Group monitors closely the developments in relation to COVID-19, focusing on the health and safety of its staff and associates and adjusts, respectively, its operation.
Key consolidated financial indicators (prepared in accordance with IFRS) for 3Q/9M20 are shown below:
Further information regarding 3Q20 / 9M20 financial results:
Quarterly Results: https://www.helpe.gr/en/investor-relations/quarterly-results/quarter-results
Financial statements: https://www.helpe.gr/en/investor-relations/quarterly-results/financial-statements/financial-statements-group