Galp 3Q23 results

All the materials related with the results are available here. The analysts' Q&A session will be held at 14:00h (Portugal / U.K. time).

“This was a strong quarter for Galp, with good operational momentum led by the performance in our Brazilian assets. Our robust financial performance was reflected across all business units in a context of disciplined strategic execution. Final investment decisions were made for a 100 MW electrolyser, set to be one of Europe's largest, and an advanced biofuels unit. These investments lay the foundation  to our future as a provider of sustainable energy solutions.” 

Filipe Silva, CEO

Third quarter 2023

Galp delivered a robust set of results supported on a strong operating performance and disciplined capital allocation during 3Q23, allowing to further strengthen its financial position.

RCA Ebitda reached €1,057 m:

• Upstream: RCA Ebitda was €594 m, down YoY, reflecting the de-recognition of the Angolan upstream assets’ disposal and a less favourable oil and gas prices environment.

  On a comparable basis, excluding Angolan assets, current portfolio working interest (WI) production was up 8% YoY, supported by the ramp-up of Coral Sul FLNG in Mozambique and stable production in Brazil.

• Renewables & New Businesses: RCA Ebitda was €43 m, on a seasonally high generation quarter, with the increased generation from added operating capacity more than offsetting the lower market price environment YoY.

• Industrial & Midstream: RCA Ebitda was €342 m, reflecting a strong performance of the industrial activities, with the system’s high utilisation capturing the international cracks environment. The contribution from the midstream businesses continued robust, benefiting from improved supply and trading activities across oil, gas and power.

• Commercial: RCA Ebitda was €111 m, up YoY, following improved performance on the Iberian retail and convenience, and despite the pressured environment on some B2B segments.

Group RCA Ebit was €741 m, mostly following RCA Ebitda.

Taxation was up YoY, including €76 m of extraordinary taxes in Iberia, leading to an implicit 63% tax rate (the rate would be 52% if excluding these extraordinary effects). RCA net income was €210 m.

Galp’s adjusted operating cash flow (OCF) was robust at €716 m, reflecting the sound operating performance. Cash flow from operations (CFFO), including working capital and inventory effects, reached €686 m.

Net capex totalled €161 m, mostly directed towards Upstream projects under execution and development in the Brazilian pre-salt, as well as the preparation of the upcoming exploration activities in Namibia and including interim inflow of €132 m related with the Angolan upstream assets’ disposal.

FCF amounted to €497 m, with Net Debt reduced by €152 m during the period.

Nine months of 2023

Galp’s RCA Ebitda was €2,838 m, while OCF was €1,781 m, reflecting a robust operating performance across all business units during the period.

Net capex totalled €476 m, mostly directed towards Upstream’s developments, and considering €209 m of inflows from the Angolan upstream assets’ disposal.

FCF amounted to €1,351 m, with net debt down 22% compared to the end of last year, considering dividends to non-controlling interests of €89 m, dividends paid to shareholders of €422 m and €308 m invested through the share buybacks.

Financial Data

Short term outlook

Galp expected 2023 Ebitda and OCF is unchanged, supported by improved business performance and despite the lower than initially assumed commodity price environment.

Net capex at €0.4-0.6 bn, reflecting the lower investments execution registered in the first half and already including the 2023 proceeds from the Angolan upstream divestments.

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