LUKOIL NET INCOME EXCLUDING NON-RECURRENT WRITE-OFF REACHED $11.3 BILLION IN 2011, FREE CASH FLOW AMOUNTED TO $7.2 BILLION
Thursday, March 1, 2012
LUKOIL has published consolidated US GAAP financial statements for 2011.
The Company’s 2011 net income rose by 15.0% and reached $10,357 million. EBITDA (earnings before interest, taxation, depreciation and amortization) rose by 15.9% and reached $18,606 million in 2011. Sales revenues were $133,650 million (+27.3% y-o-y). The positive dynamics of our financial results was mainly due to a sharp increase in hydrocarbon prices in 2011 compared with 2010.
Net income for the fourth quarter 2011 was negatively affected by $955 million losses due to the write-off of assets caused by the revaluation of the Yuzhnoye Khylchuyu field reserves.
The Company’s strict financial discipline and cost control helped generate a record high free cash flow in 2011 compared with previous years. The free cash flow reached $7,240 million in 2011 compared with $6,930 million in 2010. The capital expenditures, including non-cash transactions, in 2011 were $8,492 million, which is 24.1% higher than in 2010.
Hydrocarbon production costs per boe reached $4.71 in 2011, having increased by 14.3% y-o-y, mainly due to the appreciation of the ruble against the US dollar.
Commercial hydrocarbon production by LUKOIL Group for 2011 amounted to 2,140 thousand boe per day, which is 4.4% below y-o-y.
In 2011, throughputs at the Company’s own and affiliated refineries (including its share in crude-oil and petroleum-product throughput at the ISAB and TRN refining complexes) decreased by 1.9% y-o-y down to 64.92 million tons. Throughputs at the Company’s refineries in Russia increased by 0.1% y-o-y, throughputs at the international refineries decreased by 6.3% y-o-y. The shutdown of the Odessa refinery as a result of unfavorable economic conditions mainly accounts for the decrease in international throughputs in 2011.
Measures aimed at higher efficiency and cost control allow the Company to generate a strong free cash flow and increase the net income.
| Consolidated Statements of Income | |||
| 2011 | 2010 | 2009 | |
| (millions of US dollars) | |||
| Revenues | |||
| Sales (including excise and export tariffs) | 133,650 | 104,956 | 81,083 |
| Costs and other deductions | |||
| Operating expenses | (9,055) | (8,298) | (7,340) |
| Cost of purchased crude oil, gas and products | (59,694) | (43,250) | (31,761) |
| Transportation expenses | (6,121) | (5,608) | (4,830) |
| Selling, general and administrative expenses | (3,822) | (3,558) | (3,306) |
| Depreciation, depletion and amortization | (4,473) | (4,154) | (3,937) |
| Taxes (other than income taxes) | (12,918) | (8,978) | (6,474) |
| Excise and export tariffs | (22,217) | (18,878) | (13,058) |
| Exploration expense | (532) | (336) | (218) |
| Loss on disposals and impairments of assets | (1,663) | (363) | (381) |
| Income from operating activities | 13,155 | 11,533 | 9,778 |
| Interest expense | (694) | (712) | (667) |
| Interest and dividend income | 211 | 174 | 134 |
| Equity share in income of affiliates | 690 | 472 | 351 |
| Currency translation loss | (301) | (122) | (520) |
| Other non-operating income (expense) | 58 | 125 | (13) |
| Income before income taxes | 13,119 | 11,470 | 9,063 |
| Current income taxes | (2,678) | (2,104) | (1,922) |
| Deferred income taxes | (615) | (247) | (72) |
| Total income tax expense | (3,293) | (2,351) | (1,994) |
| Net income | 9,826 | 9,119 | 7,069 |
| Net loss (net income) attributable to noncontrolling interests | 531 | (113) | (58) |
| Net income attributable to OAO LUKOIL | 10,357 | 9,006 | 7,011 |
| Earnings per share of common stock attributable to OAO LUKOIL (US dollars) | |||
| basic | 13.30 | 10.95 | 8.28 |
| diluted | 13.04 | 10.94 | 8.28 |
Full consolidated US GAAP financial accounts of LUKOIL for 2011 are available on the Company’s web sites: www.lukoil.com and www.lukoil.ru.
