Less: share of profit of associates and joint ventures
6,306
(24,956)
(34,116)
(45,504)
(90,704)
99.3
Plus: the share of EBITDA of equity accounted investments and joint ventures
35,547
84,607
88,037
107,446
167,313
55.7
Total adjusted EBITDA
342,614
404,811
456,198
550,967
799,506
45.1
Profitability (%)
Item
as at 31.12.2014
as at 31.12.2015
as at 31.12.2016
as at 31.12.2017
as at 31.12.2018
∆ 2018/2017 (pp)
Adjusted EBITDA margin
24.33
27.58
29.52
28.48
32.12
3.6
Net profit margin
8.99
7.92
13.57
13.94
16.11
2.2
Return on assets (ROA)
6.92
5.07
8.33
9.84
12.43
2.6
Return on equity (ROE)
11.90
9.77
15.58
17.38
21.97
4.6
Adjusted return on average capital employed (adjusted ROACE)
13.07
12.15
11.77
13.90
19.66
5.8
Adjusted ROACE Return on average capital employed.(%)
Item
as at 31.12.2015
as at 31.12.2016
as at 31.12.2017
as at 31.12.2018
Adjusted EBITDA
404,811
456,198
550,967
799,506
Depreciation, depletion and amortisation
(140,659)
(158,919)
(178,449)
(216,480)
Effective income tax charge on EBIT
(53,501)
(62,429)
(71,605)
(114,725)
Adjusted EBIT Adjusted EBIT represents the Group’s EBIT and its share of EBIT of associates and joint ventures.
210,651
234,850
300,913
468,301
Average capital employed
1,733,285
1,994,626
2,164,614
2,381,424
Adjusted ROACE
12.15
11.77
13.90
19.66
Liquidity
Item
as at 31.12.2014
as at 31.12.2015
as at 31.12.2016
as at 31.12.2017
as at 31.12.2018
∆ 2018/2017 (%)
Current liquidity ratio
1.88
1.46
1.37
0.88
1.18
34.1
Quick liquidity ratio
0.94
0.79
0.66
0.42
0.67
59.5
Cash ratio
0.53
0.51
0.26
0.21
0.44
109.5
Leverage
Item
as at 31.12.2014
as at 31.12.2015
as at 31.12.2016
as at 31.12.2017
as at 31.12.2018
∆ 2018/2017 (%)
Net debt / total assets (%)
20.67
26.34
25.18
19.93
14.99
(4.9)
Net debt / equity (%)
38.38
52.44
44.45
35.20
26.50
(8.7)
Leverage (%)
31.11
36.05
30.80
25.97
20.74
(5.2)
∆ 2018/2017 (%)
Net debt / market capitalisation
0.64
0.90
0.64
0.51
0.32
(37.3)
Net debt / EBITDA
1.44
1.90
1.60
1.19
0.73
(38.7)
Total debt / EBITDA
1.87
2.37
1.68
1.39
1.07
(23.0)
The main macroeconomic factors affecting the Company’s performance
The main factors affecting the Group’s performance include:
changes in market prices for crude oil and petroleum products;
changes in RUB/USD exchange rate and inflation;
taxation;
changes in transportation tariffs for crude oil and petroleum products.
Changes in market prices for crude oil and petroleum products
Crude oil and petroleum products prices on the international and Russian markets are the main factor affecting the Group’s performance.
Prices for petroleum products on the international market are determined by the global oil prices, petroleum products demand and supply, and competition in different markets. In turn, prices in the international market affect those in the domestic market. Price trends for different types of petroleum products differ.
The increase in crude oil and petroleum product prices on the international markets in 2018 had a positive impact on the Group’s results.
Crude oil and petroleum product prices
Fuels
2014
2015
2016
2017
2018
∆ 2018/2017 (%)
International market ($/bbl)
Brent
98.95
52.46
43.73
54.09
71.16
31.6
Urals Spot (average Med + NWE)
96.94
51.49
42.02
52.94
69.86
32.0
International market ($/t)
Premium gasoline (average NWE)
918.72
569.96
467.05
557.58
674.67
21.0
Naphtha (average Med + NWE)
825.28
450.05
377.85
477.10
595.99
24.9
Diesel fuel (average NWE)
854.41
500.70
398.58
493.65
641.23
29.9
Gasoil 0.1% (average Med)
837.77
486.26
391.21
483.49
632.07
30.7
Fuel oil 3.5% (average NWE)
518.48
247.49
199.93
290.96
387.07
33.0
Domestic market (₽/t)
High-octane gasoline
31,948
32,488
34,574
36,820
41,724
13.3
Low-octane gasoline
28,071
28,435
29,858
31,931
37,249
16.7
Diesel
27,764
28,944
27,965
32,619
41,070
25.9
Fuel oil
9,014
7,202
6,051
9,594
14,319
49.2
Sources: Platts (international market), Thomson Reuters Kortes (domestic market)
Change in RUB/USD exchange rate and inflation
The Group’s management has determined that the reporting currency is the Russian rouble. The functional currency of each of the Group’s subsidiary is the currency of the economic environment where the entity operates. For most entities, this is the Russian rouble.
Item
2014
2015
2016
2017
2018
Change in Consumer Price Index (CPI) (%)
11.4
12.9
5.4
2.5
4.30
Average RUB/USD exchange rate for the period (₽)
38.42
60.96
67.03
58.35
62.71
USD/RUB exchange rate as at the beginning of the period (₽)
32.73
56.26
72.88
60.66
57.60
USD/RUB exchange rate as at the end of the period (₽)
56.26
72.88
60.66
57.60
69.47
Change in RUB/USD exchange rate for the period (%)
72
30
(17)
(5)
21
Taxation
Average tax rates for Russia’s oil and gas companies in the reporting periods