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UPDATE 1-OMV's Q3 operating profit beats expectations
November 9, 2017 / 7:11 AM / a month ago

UPDATE 1-OMV's Q3 operating profit beats expectations

* Clean CCS EBIT up 52 pct y/y at 804 mln eur

* Expects “significantly” higher 2017 refining margins vs 2016

* Upstream business boosted by higher oil price, output (Adds details)

By Shadia Nasralla

VIENNA, Nov 9 (Reuters) - Austrian oil and gas group OMV’s third-quarter adjusted operating profit jumped 52 percent to 804 million euros ($932.9 million) as oil prices and its refining margins rose from a year ago, it said on Thursday.

The average estimate in a Reuters poll of analysts for clean CCS earnings before interest and tax, which strip out one-off effects and the current cost of supply, was 756 million euros. A company poll saw them at 788 million euros.

Benchmark oil prices rose around 20 percent in the third quarter alone to end around $10 per barrel higher than a year ago, helping OMV’s exploration and production, or upstream, business to rise around sevenfold to 300 million euros.

Output, boosted by production in Norway and Libya, also rose around 40,000 barrels of oil equivalent (boe) per day to 341,000.

Like its bigger rivals, OMV has been cutting costs to buffer the impact of oil prices which are still around half of what they were in 2014. This has helped OMV’s refining and marketing, or downstream, business to almost double its margins to $7 per barrel in a year.

It said it expected its refining margins this year to be “significantly” higher than last year.

OMV slashed its costs per boe to $8.8 from $13.2 in 2015. On Thursday it also cut its investment budget by 100 million euros for this year to 1.7 billion euros, driven by lower upstream spending.

$1 = 0.8618 euros Reporting by Shadia Nasralla; Editing by Kirsti Knolle and Michael Shields

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