UNIMOT: high growths of volumes, business results and operational flows in Q1of 2020

Date of publication: 21.05.20

UNIMOT S.A., the listed on the WSE independent importer of liquid and gaseous fuels has published a quarterly report for Q1 2020. The UNIMOT Group has achieved a growth of volumes in all the business segments, higher yoy revenues and historically the highest level of consolidated adjusted EBITDA, which amounted to PLN 32.9 million.

In Q1 2020 the total revenues of the UNIMOT Group amounted to PLN 1 195.4 million, which is up by 37.6% yoy. The consolidated adjusted EBITDA (cleaned for the estimated valuation of compulsory reserve, justified movements and one-time events), which is the best benchmark of the efficiency of the UNIMOT Group’s business, reached the highest level in the history and amounted to PLN 32.9 million, which is up by 196.5% yoy and achievement of over 50% of the forecast assumed for the whole of 2020.

– This year began in an excellent way for us. This is a historically good quarter, which makes us very pleased. This is even more important as it constitutes for us a sort of a financial cushion in case potential problems in conducting the business in subsequent quarters occur following the COVID-19 pandemic. Each of our business segments recorded growths of volumes, we also achieved historically high operating flows, which in Q1 of the present year amounted to PLN 146.5 million – says Mr Adam Sikorski, President of the Management Board of UNIMOT S.A.

Very good business results are primarily driven by the favourable external environment in the diesel oil business (volumes up by 41.5% yoy), higher than the assumed bio-fuels sales volumes following a larger number of won tenders (volumes up by 50.8% yoy), and also higher sales of natural gas generated on the wholesale, mainly thanks to the volumes of the rented in 2019 storage space in the underground gas storage (cavern) (the whole natural gas segment generated volumes higher by 183.9% yoy). Over 30% growths of volumes were also recorded by the segments of electricity and LPG.

Unprecedented drops of crude oil prices observed in Q1 2020 had an influence on the book valuation of Group’s compulsory reserves, which translated into negative book results – The Group’s EBITDA reached the level of PLN -9.3 million, and the net loss PLN -10.6 million.

– Our book EBITDA hardly ever reflects actual business results as it is influenced by the valuation of reserves, which comprises the valuation of actual product and valuation of instruments that hedge this product. The price we pay for 100% hedging against the change of market quotations is the impact on the book result of price volatility (spot and futures) in time. This time this negative impact amounts to PLN -45.3 million, but still non-monetary and temporary – the moment the hedging becomes mature, the sum of compulsory reserve and hedging transactions valuation will equal zero – explains Mr Marek Moroz, Vice-President of the Management Board for Financial Issues.

The impact of the COVID-19 pandemic in Q1 2020 was in the scale of the UNIMOT Group insignificant, and after a worse April, since May in some business one can observe a gradual improvement of the situation – It is difficult to foresee what this situation will look like in the future but at present we are very optimistic about the future. Until the present day we have not observed a negative impact of the pandemic on our main segments, that is diesel oil and bio-fuels. The segment of wholesale electricity trading also looks positive and the LPG segment achieves ever better margins. However, we are expecting that the results of Q2 will be closer to the results of Q1 or Q2 of 2019 – says Mr Adam Sikorski, President of the Management Board of UNIMOT S.A.

In connection with the COVID-19 pandemic the Group has implemented a saving plan in the scope of reducing the operating costs (marketing, IT, business trips), which in the scale of the year will amount to PLN 3 million. Next stages of further cost reduction have also been prepared in case such a need occurs.

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