Ecopetrol Sa · BVC:ECOPETROL
Ecopetrol Sa — H1 2011 Earnings Presentation
29 slides from Ecopetrol Sa's earnings presentation, Jul 26, 2011
Slide 1: Financial and Operating Results First semester 2011
FINANCIAL AND OPERATING RESULTS First semester 2011 July 26, 2011
Slide 2: Disclaimer
DISCLAIMER This document may include strategy discussions and forward-looking statements regarding the probable development of Ecopetrol’s Business. Said projections and statements include references to estimates or expectations of the Company regarding its future and operational results. Potential
Slide 3: Management Participants in Today's Conference Call
MANAGEMENT PARTICIPANTS IN TODAY´S CONFERENCE CALL Javier Gutierrez Pedro Rosales Enrique Velasquez Chief Executive Officer EVP of Downstream VP of Exploration Camilo Marulanda Alvaro Castañeda Adriana Echeverri VP of Growth and VP of Transportation Chief Financial Officer Strategy and Logistics Hec
Slide 4: Agenda
AGENDA 1 Highlights for the first semester of 2011 2 Financial results for the first semester of 2011 3 Outlook for the second semester 2011 4
Slide 5: Highlights for the First Semester of 2011
HIGHLIGHTS FOR THE FIRST SEMESTER OF 2011 “Historically strong financial and operating results.” Production growth Higher evacuation capacity Higher income and Ebitda Corporate Group Production Evacuation Capacity Ebitda and Net Income (COP$ tn) (thousand barrels of crude and gas per day) (thousand
Slide 6: Investment Plan for the First Semester of 2011
INVESTMENT PLAN FOR THE FIRST SEMESTER OF 2011 “Execution of Capex according to plans”. Higher investments (US$ millons) 3,418 38 Corporate and other 157 135 245 Refining and Petroch. 347 1,933 Exploration 433 44 New business 224 532 115 36 Transport 251 186 1 Acquisitions 1,530 1,076 Subsidiaries P
Slide 7: Exploration and Production
EXPLORATION AND PRODUCTION “ Five discoveries in Colombia and record production.” Discoveries in Colombia Production Growth Well Nunda-1 Well Fauno-1* Location Huila province Location Meta Province Type of crude Light (API 30°) Type of crude Heavy (API 12°) Type of well A3 Type of well A3 Corporate
Slide 8: Transportation
TRANSPORTATION “Key expansion of infrastructure allowed transporting higher volumes .“ Key projects of transport infrastructure expansion: Higher evacuation capacity Main lines, ports and storage facilities Exp. Port Coveñas Pozos – Galán Crude evacuation capacity +27 MBOD +300 MBOD (thousand barrel
Slide 9: Refining
REFINING “ Higher through-put in order to produce cleaner fuels, with increased profitability .” Through-put increase at the Higher refining margin Barrancabermeja refinery at the Barrancabermeja refinery Refinery through-put Gross refining margin (thousand barrels per day) (USD/Barrel) 230 6.96 3.8
Slide 10: Sales and Marketing
SALES AND MARKETING “56% share of exports in total sales and price of crudes & products rose more than 38%.” Sales volumes growth Higher prices of crude, products and gas Total sales Prices of crude, products, and gas (thousand barrels of crude and gas / day) (US$ / Bl) 825 723 339 464 97 95 384 361
Slide 11: Organizational Consolidation
ORGANIZATIONAL CONSOLIDATION Highlights of the first semester of 2011 Environmental incidents / Accidents Ranked among the top 100 most respected global companies by Barron’s (WSJ group) 91 87 HR Ranked as the 444 largest company in Fortune Magazine’s top 500 1H2010 19 17 1H2011 Procurement Sa
Slide 12: Agenda
AGENDA 1 Highlights for the first semester of 2011 2 Financial results for the first semester of 2011 3 Outlook for the second semester 2011 1
Slide 13: Financial Results of Ecopetrol S.A.
FINANCIAL RESULTS OF ECOPETROL S.A.* “ Historically high level of revenues, net income and Ebitda” Total Revenue Costs and Expenses Operating Profit (COP$ trillion) (COP$ trillion) (COP$ trillion) and Operating Margin (%) 39% 41% 33% 26.2 27% 31% 15.4 17.9 18.8 12.0 11% 15.9 11.0 11.4 66% 11.8 8.6 7
Slide 14: Segment Financial Results of Ecopetrol S.A.
SEGMENT FINANCIAL RESULTS OF ECOPETROL S.A.* “Positive Ebitda in all business segments in 2011.” 16.8 1H-2010 1H-2011 10.6 9.8 7.4 Total Revenues 1.8 3.8 6.3 (COP$ trillion) 1.4 E&P Refining Transportation Sales and Marketing 6.6 1H-2010 1H-2011 3.9 Net Income 0.397 0.262 0.072 (COP$ trillion) -0.37
Slide 15: Cash Flow and Balance Sheet of Ecopetrol S.A.
CASH FLOW AND BALANCE SHEET OF ECOPETROL S.A.* “S&P and Fitch upgraded our rating to investment grade (BBB- /stable) in 2011.” Initial Sources Uses Final 30.8 0.6 24.7 Cash Flow 16.3 7.9 5.5 1H 2011 4.3 2.0 0.3 (COP$ trillion) Initial Operations Other Cash available Operations Capex Dividends Fx Dif
Slide 16: Financial Results of Subsidiaries
FINANCIAL RESULTS OF SUBSIDIARIES “ Corporate Group’s results were also historically high” Total Revenues Net Income(COP$ tn) & Net Margin (%) Ebitda (COP$ trillion) y Ebitda Margin (%) (COP$ trillion) 22% 47% 30.6 21% 39% 40% 39% 37% 18% 18% 16% 21.5 17.9 20.4 63% 12.5 14.4 6.9 8.0 8.7 37% 4.4 6.5
Slide 17: Financial Results of Subsidiaries
FINANCIAL RESULTS OF SUBSIDIARIES Ebitda* Net income* Company 1H2010 1H2011 1H2010 1H2011 Hocol 328 577 147 313 Savia 60** 92** 29** 52** EXPLORATION Ecopetrol America -185 -29 -250 -95 & PRODUCTION Ecopetrol Brasil -20 -28 -12 -8 Ecopetrol Peru -1 -10 0 -10 Equión N.A. 179 N.A. 73 Reficar 2 86 -4 1
Slide 18: Agenda
AGENDA 1 Highlights for the first semester of 2011 2 Financial results for the first semester of 2011 3 Outlook for the second semester 2011 18
Slide 19: Outlook for the Second Semester of 2011
OUTLOOK FOR THE SECOND SEMESTER OF 2011 EXPLORATION • Drilling of 37 exploratory wells in 2011 PRODUCTION • Average Production for the Corporate Group of 750 mboed in 2011 • Crude evacuation program TRANSPORTATION • Increase capacity of ODL pipeline to 200 thousand barrels per day • Begin the contra
Slide 20: Investor Relations
INVESTOR RELATIONS • Phone (+ 571) 234 5190 • Email [email protected] • Website www.ecopetrol.com.co 20
Slide 21: Restricted use notice
Para uso restringido en Ecopetrol S.A. Todos los derechos reservados. Ninguna parte de esta presentación puede ser reproducida o utilizada en ninguna forma o por ningún medio sin permiso explícito de Ecopetrol S.A.
Slide 22: Operating Results Ecopetrol S.A.
OPERATING RESULTS ECOPETROL S.A.* Production (MBOED) Sales (MBOED) Through-put at the B/meja refinery (MBD) 674.4 597.3 609.0 634.1 824.2 825.6 559.3 96.7 738.3 758.0 98.4 97.9 97.1 726.2 94.9 360.5 457.9 469.1 362.6 438.6 236.7 577.7 232.3 229.5 230.1 498.9 511.1 537.0 464.4 377.8 363.6 319.4 366.3
Slide 23: Corporate Group Production
CORPORATE GROUP PRODUCTION Thousand barrels of oil equivalent day (MBOED) 707.3 2.0 615.9 12.5 6.9 590.1 30.8 1.9 7.5 520.6 2.0 27.0 7.1 25.6 1.0 14.7 6.2 655.1 579.5 555.4 498.7 447 376 385 399 2005 2006 2007 2008 2009 2010 Jan-Jun 2010 Jan-Jun 2011 Ecopetrol Hocol Savia Equión K2 23
Slide 24: Reserves Balance – MBOE
RESERVES BALANCE – MBOE CORPORATE GROUP – SEC AFTER ROYALTIES 1P RESERVES BALANCE SEC AFTER ROYALTIES CORPORATE GROUP 193% X% IRR 1800 359% 1.714 1600 1.538 98% 65% 1400 46% 1.253 1.210 1200 1.137 MMBLS - Eq 1000 800 600 400 200 0 2006 2007 2008 2009 2010 24
Slide 25: Transportation
TRANSPORTATION Main infrastructure expansion projects: Afferent pipelines Santa Marta Cartagena Coveñas Ayacucho Rubiales – Monterrey Pipeline +80 MBOD B/Bermeja Caño (240 MBOD) Sebastopol Limón 1Q Vasconia Cusiana Vasconia - Galán Araguaney +20 MBOD Porvenir Monterrey Santiago (165 MBOD) 2Q Rubiale
Slide 26: Sales Volumes
SALES VOLUMES Local sales Exports 719 825 723 547 650 475 464 302 356 339 Total Sales 148 216 (MBOED) 327 331 348 363 384 361 2007 2008 2009 2010 Jan-Jun 2010 Jan-Jun 2011 Crude oil Ref. Products Natural Gas 464 356 23 339 56 302 20 37.5 7 49 1 216 49 Exports 148 (MBOED) 51 16 312 289 385 53 233 95
Slide 27: Operational Costs
OPERATIONAL COSTS 8.3 8.0 8.5 9.1 Lifting Cost 7.2 7.2 5.2 (USD/BOE)* ** 2006 2007 2008 2009 2010 Jan-Jun 2010 * * Jan-Jun 2011 5.8 6.0 5.7 5.5 5.3 3.5 4.5 Refining Cost (USD/Bl) 2006 2007 2008 2009 2010 Jan-Jun 2010 Jan-Jun 2011 0.40 0.43 0.42 0.44 0.41 0.41 0.35 Transportation Cost 2006 2007 2008
Slide 28: Return on Assets and Equity
RETURN ON ASSETS AND EQUITY 24% 21% 20% 18% 19% 18% Return on 9% 10% 9% 9% 12% 12% 15% 13% 12% 13% 11% 10% Assets 8% 7% 9% 9% (ROA) 40% 39% 37% 34% 35% 32% 26% 26% 28% Return on 22% 18% 22% 24% 23% 23% 16% 17% 16% 16% 21% 20% Equity 19% (ROE) 28
Slide 29: Debt Profile of Ecopetrol S.A.
DEBT PROFILE OF ECOPETROL S.A.* • Outstanding: COL$ 2.2 trillion Syndicated • Term: 7 years (including 2yr. grace period) Loan • Interest rate: DTF + 4% T.A. • Amortization: Semiannual • Outstanding: US$1.5 billion • Coupon 7.625% International • Coupon payment: Semiannual (Jul. 23 and Jan. 23) Bond