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Motor Oil (Q4/FY:18 results):

MANOS CHATZIDAKIS – BETA SECURITIES

Motor oil will announce Q4/FY:19 results today after market hours. Management will host a conference call tomorrow to discuss results. We expect a soft quarter affected by refining margins drop and significant inventory losses. In specifics:

§   Sharp drop in oil prices in Q4 (-24%) will weight on sales which are seen -20% lower y-o-y. In regards of volumes the refinery is expected to post a satisfactory volume of 3.4m MT.

§   Lower refining margins in the tune of 8 $/bbl in Q4 as a results of gasoline crack drop and the tightening of differential spread are behind the 24% y-o-y drop in refining EBITDA. Marketing EBITDA is forecasted lower by 20% y-o-y affected also by segmental inventory losses. Clean EBITDA is expected to shape at €115m

§   Going further down we pencil in depreciation of €26m and net financial costs of €11.5m. Clean net income is forecasted at €55.7m

§   On a reported level accounting for c€60m inventory losses we expect EBITDA at 55m (-67% y-o-y) and net earnings of €11.3m (-84.8%)

§   Despite interim dividend payment and tax payment Q4:18 FCF is expected to remain at positive territory. Remaining dividend is expected at 1.0 eur/share while total dividend for the year will reach 1.3 eur/share.

§   In the conference call we will be looking for updated outlook regarding IMO 2020, refinery upgrade CapEx and scheduling and conclusion timetable of recently announced take overs (namely Alpha TV and IBG Bank).

§   Motor oil trades 4.9x its EV/EBITDA and has 6% expected dividend yield. 

The following table summarize our Q4/FY:19 estimates 

Motor oil

2017

2018 (Est)

Y-o-Y

2017

2018 (Est)

Y-o-Y

EUR mn.

FY

FY

(%)

4Q

4Q

(%)

Volumes (MTx1000)

13,651

13,930

2.0% 

3,458 

3,400 

-1.7% 

Sales

7,843.5

8,380.3

6.8% 

2,106.5 

1,680.0 

-20.2% 

EBITDA

620.6

531.9

-14.3% 

167.0 

55.0 

-67.1% 

Adjusted EBITDA

649.6

570.9

-12.1% 

150.0 

115.0 

-23.3% 

of Which Refining

576.6

479.9

-16.8%

132.6

101.0

-23.8%

of which Marketing & other

73.0

91.0

24.7%

17.4

14.0

-19.5%

Net Income

313.5

273.9

-12.6% 

86.5 

13.1 

-84.8% 

Adjusted Net Income

331.2

301.7

-8.9% 

74.4 

55.7 

-25.1% 

Conference call details (Tuesday, March 19th, 17:30 GR- Time)

§   GBR         0808 2380 669

§   GRE         800 848 1114

§   US           1 877 553 9962

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