MOL Group: Solid Performance in 2020

MOL Group has announced its financial results for 2020 that shows operating earnings without one-off special effects and adjusted by the current cost of supply decreasing but still a bit above USD two billion.

Despite the much challenging pandemic and economic crisis, MOL Group generated USD 464 million Clean CCS EBITDA in the fourth quarter, bringing full-year Clean CCS EBITDA to USD 2.05 billion, above the updated guidance.

The company's statement says that in a year of disruption, volatility and uncertainty, all segments generated positive simplified free cash flow that resulted in USD 636 mn in 2020, higher than a year ago. Organic capex was at USD 1.41 bn in 2020, in line with the guidance (up to USD 1.5 bn). MOL expects 2021 EBITDA at around USD 2.3 bn as macro likely recovers.

Chairman-CEO Zsolt Hernádi is quoted in the statement by saying that “we delivered over USD 2bn EBITDA in 2020, and while earnings were lower compared to 2019, our fast and timely reaction to the crisis allowed us to generate even stronger free cash flow than our pre-Covid guidance. This was only possible with each and every business line having cash positive operations even in a year of major disruption.

2020 was an unprecedented year with never seen challenges. I am very proud of all our colleagues, as our operations were running uninterrupted even amidst the biggest crisis, we continued to be a reliable partner of all our customers and partners and we were able to continue all our strategic investments, although unfortunately they slowed down a bit due to the mobility restrictions. Even under major stress we are not losing sight of our vision and we will be doubling our efforts in 2021 to progress with our business transformation.

We expect 2021 to be a year with some normalization and recovery, which is also behind our rising EBITDA guidance of USD 2.3 bn. Our capital investments also need to catch up, so our organic capex shall be at around USD 1.7-1.9 bn, once again implying a fully funded business with positive free cash flow.”

The statement also points out that upstream production volume increased by 8% in 2020 to 120 mboepd thanks to the contribution of ACG, yet EBITDA decreased by 34% year-on year due to the extremely weak external price environment; downstream Clean CCS EBITDA decreased in Q4 to USD 133mn, hit by depressed refinery margins and the usual Q4 seasonality. Full-year result was 15% lower than a year ago; Consumer Services EBITDA rose by 23% in Q4 2020 to USD 128 mn, the segment generated an all-time high USD 510mn EBITDA in full year 2020, 8% higher than in 2019; while the 2021 EBITDA guidance is at around USD 2.3bn as some macro recovery expected.