Hungary’s MOL Group announced a US$152 million net loss for Q1 2020, which it blamed on the COVID-19 pandemic-related crisis.
MOL said that underlying operations were running strong until mid-March, as reflected by the US$622 million Clean CCS EBITDA, however, the pandemic had already started to severely affect all business lines in the last 2-3 weeks of March and the situation further deteriorated in April.
“Due to the unpredictable external environment, 2020 EBITDA guidance was withdrawn, and organic capital expenditure guidance was cut by more than 25 per cent,” said MOL.
Chairman-CEO Zsolt Hernádi commented on the results: “Covid-19 shapes and rules the world and the energy industry. The pandemic situation and economic crisis that follows will cast a long shadow on our overall performance in 2020. While we are fighting the pandemic and doing our best to protect our people, our customers and partners, we are also working hard to make sure MOL can continue to operate even under extreme scenarios and can eventually emerge even stronger from this crisis. Our dedicated people, high quality assets, strong balance sheet and our resilient, integrated business model shall help us navigating through these unchartered waters. We have already made a series of difficult decisions that will help us to achieve cash neutrality, to maintain our liquidity and financial flexibility and to grab opportunities which may arise on the way towards normalisation.”
MOL reported that in Q1 it’s upstream EBITDA decreased to US$185 million in Q1. Oil and gas production volumes were 110.6 mboepd, 4 per cent lower than a year ago, due to the natural decline in CEE.
On the downstream side, MOL said that the Clean CCS EBITDA doubled and increased to US$295mn in Q1 from a low base, supported by doubling refinery margins. The polyol project reached 60 per cent completion at the end of Q1. The pandemic affects the project’s supply chain and makes workforce mobilisation increasingly difficult. Its full impact on the project schedule is not yet possible to assess, but delays are expected.