Sergii Koretskyi, CEO at UKRNAFTA, spoke about the Company’s performance during the first 12 months of the new management.
Financial indicators.
Net profit for the first half of 2023 amounted to UAH 14.1 bln. Currently, the net profit exceeded UAH 20 bln.
“This is the net profit from economic activity, the result after paying all taxes, in particular, income tax. With no changes to the accounting policy. Even considering the currency fluctuations and the inflation index”, Sergii Koretskyi noted.
For comparison, the cumulative result for the previous 10 years is billions lost.
According to the Director, the Company’s revenue for 2023 will be at the level of UAH 95 bln. That is, it will more than double the annual average for the last decade. This is the result of transparent market work without intermediaries.
In total, UAH 12.3 bln of tax was paid in the first half of the year. According to the results of the first half of the year, UAH 3.3 bln of income tax was paid.
"The plan of tax payments for the entire year 2023 is UAH 27 bln, including about UAH 5 bln of income tax. For example, over the last 10 years, UAH 12 bln of income tax was paid. Accordingly, only in 2023 the Company will transfer 5 times more funds to the state budget than the average during 2012-2021," explained Sergii Koretskyi.
According to him, the Company is preparing to pay at least UAH 6 bln of dividends based on the results of 2023 (the minimum rate is 30% of net profit - determined by the decision of the shareholders), which is more than the total result of the last 10 years.
Production
Ukrnafta set an ambitious goal of increasing oil production by 6% compared to 2022. There will be an increase, though a bit lesser than expected. On the contrary, there is an increase in the gas production exceeding the planned values. The balance of natural gas kept in the underground gas storages at the end of the year will not be less than at the beginning.
The plan for new well drilling remains unchanged – 9 in 2023 and 30 in 2024. Example to compare with: during the last years, 1-2 wells were drilled per year.
"For the first time in 10 years, we are doing 3D seismic survey. The implementation of three important geological survey programs for 2023-2027 has begun: 3D seismic surveys, geochemical surveys, exploration and production drilling. During the first year of implementation of the programs, we managed to increase the mining reserves by 1.2 million tons of conditional fuel- says Sergii Koretskyi. - We are transforming the Company according to world standards. Agreements were signed with the American Petroleum Institute, Weatherford, Oil Dynamics, Baker Hughes, Halliburton. Step by step, we attract the best equipment for drilling and production stimulation to replace the outdated Russian and post-Soviet equipment”.
Openness and efficiency
According to the Director of Ukrnafta, use of the Prozorro allowed the Company to save 9% of the expected cost. These are hundreds of millions of hryvnias.
"We got our own railway code. It is hard to believe, but the largest oil company used to have no railway code and only employed the third parties’ services, - notes Sergii Koretskyi. - We finally started using the electricity supplier’s license - since April, we have been saving 2% of the day-ahead market price, which is tens of millions of hryvnias per year. Previously, we also used to buy from intermediaries. We managed to halve the bank acquiring rate. It is another UAH 40 mln saved. We now have zero problem receivables during the period of work of the new management."
Network
According to the Director of PJSC Ukrnafta, sales in the gas station network have increased. In particular, the gas station technology fuel waste is decreased by 10%. The number of non-fuel checks is +43%, up to 3.7 mln (2.6 mln in the same period of last year). The turnover for January-October 2023 increased by 30%, considering the inflation. The conversion, i.e. the ratio between non-fuel and fuel receipts is +78%, i.e. it grew from 0.13 to 0.23. The goal is to achieve the conversion equal to 1.
"We launched our own branded fuel trucks. Almost 100 trucks with the Ukrnafta logo carry fuel of the highest European quality, providing their own gas station network, - notes Sergii Koretskyi. - We launched our own (and not third-party) vouchers and fuel cards for B2B. Thousands of new customers are already buying high-quality Euro-5 fuel in the largest national network of Ukrnafta gas stations. Thank you for your trust.".
The Company is refurbishing 100 stores - the former kiosks and through-window outlets with an entrance to the toilet on the street are now the full-fledged minimarkets with coffee and snacks. In 2024, +100 more such stores are planned.
Assistance to the Defence Forces
The Company supplies the Ministry of Defence of Ukraine with fuel in full.
"In 10 months, the savings for the Armed Forces of Ukraine from price reductions by Ukrnafta exceeded UAH 1.2 bln," reports Sergii Koretskyi. - UAH 700 mln of aid were provided to the Defence Forces. For armoured vehicles, drones, pickups and much more for military units. By the end of the year, we plan to provide approximately UAH 800 mln of aid. That is, the aid will amount to UAH 1.5 bln in total."
Separately, the Company Director noted that, considering the amount of funding for the support of the Armed Forces of Ukraine, the net profit could have been by UAH 1.5 bln higher. However, Serhii Koretskyi believes that this is an absolute necessity, so the Company will continue to support the Army and the front.
In addition, Ukrnafta supports veterans. The Company’s adaptation program helps them return to civilian life
