Post on 04-Apr-2020
February 2020
PKN ORLEN
PKN ORLEN – Capital Group presentation
ORLEN. FUELLING THE FUTURE
PKN ORLEN – one of the biggest oil&gas companies in Europe (1)
BUSINESS SEGMENTS
� 197 m boe 2P reserves in Poland and Canada
� Average production ca. 18,2 th. boe/d in 2019LEADER IN CENTRAL EUROPE
Refining
� Refineries located in Poland, Lithuania and the Czech Rep. with total max. crude oil
throughput of 35,2 mt/y
� Strategic location with an access to crude oil, product pipelines and sea terminals
� REBCO crude oil processing allows to benefit from Brent/Ural differential
� Diversification of crude oil supplies
Petchem
� Petrochemical assets fully integrated with refining
� Launching new production capacity
Energy
� 6,1 GWt / 1,9 GWe (including over 1GWe from modern CCGT blocks located in
Włocławek and Płock)
� 1,2 GWe – project of offshore wind farm on the Baltic Sea
� Over 2800 fuel stations – the largest retail network in Central Europe
� Ca. 2150 Stop Cafe/Star Connect (including convenience stores branded O!SHOP)
� Cobranding: ORLEN brand on foreign stations within the Group
2
PKN ORLEN – one of the biggest oil&gas companies in Europe (2)
27,52%
28,83%
43,65%Others
State Treasury
Polish pension funds
PKN ORLEN listed on WSE since 1999
INDICES:
WIG, WIG20, WIG30, WIG Poland, WIG Paliwa, WIG - ESG
Market capitalization:
ca. PLN 36,7 bn
SHAREHOLDERS STRUCTURE KEY DATA 2019
Data as of 31.12.2019 3
PLN
9,4bn
EBITDA LIFO
197
m boe
2P oil and gas
reserves
33,9
mt
Record-high
throughput
PLN
3,1bn
Record-high
retail result
43,3
mt
Record-high
sales
PLN
3,5per
share
Dividend
Data as of 31.12.2019
* Poland, Lithuania, the Czech Republic
THROUGHPUT AND UTILIZATION RATIOmt; %
27,330,9 30,1
33,2 33,4 33,9
2014 2017
84%90%
2015
86%94%
2016
95%
2018
96%
2019
Utilisation ratio
Downstream
Refining
COMPETITIVE ADVANTAGES
� Refinery in Plock classified as a super-site (acc. to
WoodMackenzie) considering the depth and throughput
capacity as well as integration with petchem
� Diversification of crude oil and security of natural gas supplies
� Prepared for changes in regulatory and market trends due to
execution of investment projects
� Leader in the fuel market in the Central Europe*
REFINING
PLN 4,3 bn
EBITDA LIFO
KEY DATA
� Max. throughput capacity is 35,2 mt/y, of which: 16,3 mt/y
Płock, 10,2 mt/y ORLEN Lietuva and 8,7 mt/y Unipetrol
� Ca. 60% of crude oil throughput is REBCO, which allows to
benefit from B/U differential
� Long-term contracts secure ca. 50% of throughput capacity.
Remaining crude is bought on spot market
� Wholesale market share: gasoline (PL: 65%, CZ: 64%,
LT: 82%) and diesel (PL: 54%, CZ: 60%, LT: 76%)
� Propylene glycol unit and the purchase of a license and base
project for unit to produce second generation bioethanol
(ORLEN Południe), Visbreaking unit (Płock)
4
Downstream
Petrochemicals
KEY DATA
� Sales in 2019 amounted to ca. 5,2 mt
� Market share ca. 40% - 100% depending on the product
� PX/PTA – one of the most advanced petrochemical complex in
Europe with PTA production capacity of 690 kt/y
� Launching of Metathesis (Płock) and PPF Splitter (ORLEN
Lietuva)
� Construction of Polyethylene unit in Unipetrol at final stage
� Petrochemicals Development Program
� building of Aromatics complex
� expansion of Olefins
� expansion of Phenol capacity
� building new R&D Center
COMPETITIVE ADVANTAGES
� The largest petrochemical company in Central Europe*
� Petchem assets integrated with refining
� Attractive portfolio of petchem products including: monomers,
polymers, aromatics, PTA, fertilizers and PVC
� Strategic regional supplier for chemical industry
PETROCHEMICALS
ANWIL – CHEMICAL COMPANY
� PVC and fertilizers producer
� Ethylene pipeline connection with Plock refinery secures
feedstock for PVC production
� Synergies with CCGT block in Włocławek – steam, electricity
and infrastructure
� Expansion of fertilizers production
PLN 2,7 bn
EBITDA LIFO
Data as of 31.12.2019
* Poland, Lithuania, the Czech Republic 5
Downstream
Energy
ENERGY
Data as of 31.12.2019
* LT - Lithuania
COMPETITIVE ADVANTAGES
� ORLEN Group – one of the key producers of electricity and heat
consumed in majority internally. Electricity production in 2019 ca.
8,6 TWh.
� ORLEN Group has power plants in 3 countries, of which:
� the biggest industrial block in Poland: EC Płock (415 MWe,
2150 MWt).
� modern Combined Cycle Gas Turbines in Poland:
CCGT Włocławek and CCGT Płock (over 1000 MWe in total).
� Ca. 3,1 bn m3 gas consumption in ORLEN Group in 2019,
including ca. 2,9 bn m3 in Poland, which makes us one of the
largest gas consumers in Poland.
LOW EMISSION ENERGY PROJECTS
� PKN ORLEN has a concessions for construction wind farms
on the Baltic Sea with maximum capacity of 1200 MWe.
Concession expires in 2027.
� Final capacity of the wind farm and each of turbines will
depend on e.g.: geological conditions of the Baltic Sea bottom,
environmental conditions and technological progress.
� In case of positive evaluation of the project, investment phase
may start in 2023/24.
INSTALLED THERMAL CAPACITYMWt
INSTALLED ELECTRICAL CAPACITYMWe
3 658
POLAND
1 399
CZECH
REP.
1 040
LT*
POLAND
CZECH REP.
LITHUANIA
1600
142
160
6
COMPETITIVE ADVANTAGES
� Modern and the largest network of fuel stations in Central
Europe*
� ORLEN – strong, recognizable and the most valuable brand in
Poland (PLN 4,7 bn)
� Attractive loyalty programs
� Dynamic growth of non-fuel offer by launching new Stop
Cafe/Star Connect locations (including convenience stores
O!SHOP)
� E-mobility – expansion of EV chargers
COFFEE CORNERS AND CONVENIENCE STORES
#
Retail
RETAIL
PLN 3,1 bn
EBITDA LIFO
Data as of 31.12.2019
* Poland, Lithuania, the Czech Republic
KEY DATA
� 2836 fuel stations, of which: 1800 Poland, 585 Germany,
416 Czech Rep., 25 Lithuania, 10 Slovakia
� Market share: 34% Poland, 24% Czech Rep., 7% Germany,
5% Lithuania
� 2145 Stop Cafe/Star Connect locations, of which: 1699 Poland
(including 518 O!SHOP), 306 Czech Rep., 117 Germany and
23 Lithuania
� In 2019 we sold 66,8 million hot-dogs (2,1 per second) and ca.
17,2 million litres of coffee (almost 8,5 olympic swimming pools)
� At the end of 2019 we had 0,6 million active FLOTA customers
and 5,9 million active VITAY customers
� Alternative fuel stations: 64 EV chargers, 2 hydrogen, 42 CNG
1 7261 737
1 7651 815
1 8751 907
1 947
2 0162 047
2 069
2 108
2 145
1 700
1 800
1 900
2 000
2 100
2 200
2Q17 4Q17 4Q181Q17 2Q183Q17 1Q18 3Q18 1Q19 2Q19 3Q19 4Q19
7
Upstream
UPSTREAM
PLN 0,3 bn
EBITDA LIFO
18,2 th. boe/d
TOTAL (2P) CRUDE OIL AND GAS RESERVES
197 m boe
AVERAGE PRODUCTION IN 2019
Poland : ca.1,0 th. boe/d (100% gas)
Canada : ca.17,2 tys. boe/d (49% liquid hydrocarbons)
COMPETITIVE ADVANTAGES
� Flexible response to changes in the oil and gas market
� Adjusting capital expenditure plans to the macro situation
� Leveraging segment synergies in Poland and Canada
POLAND
Total reserves of crude oil and gas (2P)
Ca. 11 m boe (8% liquid hydrocarbons, 92% gas)
EBITDA*: PLN 7 m
CAPEX: PLN 158 m
Total reserves of crude oil and gas (2P)
Ca. 186 m boe* (58% liquid hydrocarbons, 42% gas)
EBITDA*: PLN 324 m
CAPEX: PLN 476 m
CANADA
Data as of 31.12.2019 8
PKN ORLEN competitive advantages
� Integrated, high-class assets and strong position on the competitive market
� New units and attractive portfolio of products offered on developing markets
� Best locations and synergies of gas-fired power plants with other segments
� Modern and the largest sales network in the region with strong and recognizable
brand
� Upstream assets in Poland and Canada – cautious continuation strategy
Financial
strength
Value
creation
People
� Diversified sources of financing
� Average debt maturity in 2021
� Investment rating from Fitch and Moody’s
� Financial gearing – below 30%
� Net debt / EBITDA LIFO – below 1,5
� Dividend – paid every year since 2013
� The World’s Most Ethical Company 2019
� Top Employer Polska 2019
� Platts 2019 TOP250 – 45th place among the largest energy companies in the world
� ORLEN becomes a Title Sponsor of Alfa Romeo Racing
9
Thank you for your attention
For more information on PKN ORLEN, please contact Investor Relations Department:
phone: + 48 24 256 81 80
fax: + 48 24 367 77 11
e-mail: ir@orlen.pl
www.orlen.pl
Agenda
Supporting slides
11
Dividend
PLN
3,00
per share
2017
2013
PLN
1,50
per share
2014
PLN
1,44
per share
2015
PLN
1,65
per share
2016
PLN
2,00
per share
� Our divided policy is to pay dividend on the regular basis
� Dividend level depends on achieved results, macro situation,
liquidity and financial ratios as well as planned investments
� According to divided policy, the dividend is paid regularly
since 2013 (7 years in row)
� In 2019, we paid the record-high dividend of PLN 1.5 bn
(PLN 3,50 per share)
PLN
3,00
per share
2018
PLN
3,50
per share
2019
12
Source: Oil & Gas Journal, PKN Orlen own calculations, Concawe,Reuters, WMRC, EIA, NEFTE Compass, Transneft.ru
Refinery (capacity m tonnes p.a.; Nelson complexity index)
�Oil pipeline [capacity]
Refinery of PKN ORLEN Group
Projected Oil pipeline
Sea terminal (capacity)
Lisichansk
(8.5; 8.2)
Batman
(1.1; 1.9)
Yaroslavi
Ingolstadt
(5.2; 7.5)
Litvinov (5.4, 7.0)
Kralupy
(3.3; 8.1)
Plock
(16.3; 9.5)
Gdansk
(10.5; 10.0)
Mazeikiai
(10.2; 10.3) Novopolotsk
(8.3; 7.7)
Mozyr
(15.7; 4.6)
Bratislava
(6.0; 12.3)
Schwechat
(10.2; 6.2)
Burghausen
(3.5; 7.3)
Holborn
(3.8; 6.1)
Bayernoil
(12.8; 8.0)
Harburg
(4.7; 9.6)
Leuna
(11.0; 7.1)
Schwedt
(10.7; 10.2)
Aspropyrgos
(6.6; 8.9)
Corinth
(4.9; 12.5)
Elefsis
(4.9; 1.0)
Thessaloniki
(3.2; 5.9)
Izmit
(11.5; 6.2)
Izmir
(10.0; 6.4)
Kirikkale
(5.0; 5.4)
Duna
(8.1, 10.6)
Arpechim
(3.6; 7.3)
Petrobrazi
(3.4; 7.3)
Petrotel
(2.6; 7.6)Rafo
(3.4; 9.8)
Petromidia
(5.1; 7.5)
Rijeka
(4.4; 5.7)Sisak
(3.9; 4.1)
Novi Sad
(4.0; 4.6)
Pancevo
(4.8; 4.9)
Neftochim
(5.6; 5.8)
Drogobich
(3.8; 3.0)
Kremenchug
(17.5; 3.5)
Odessa
(3.8; 3.5)
(ex 12)
Kherson
(6.7; 3.1)
DRUZHBA
DRUZHBA
DRUZHBA
ADRIA
IKL
ADRIA
�(18) Ventspils
Butinge(14)
�
(70) Primorsk� Kirishi
Yuzhniy
(ex 4)�
Brody
Tiszaojvaro
s
�
Triest�
�
Rostock�
[Ca 55]
�[C
a 2
2]
�[C
a 3
0]
Novorossiys
k
(ex 45)
�
Trzebinia
(0,5)
Jedlicze
(0,1)
Naftoport(30)
[Ca 20][Ca 9]
[Ca 10]
[Ca 9][Ca 3,5]
�(30) Ust-Luga
BPS2
Supply routes diversification
13
This presentation (“Presentation”) has been prepared by PKN ORLEN S.A. (“PKN ORLEN” or “Company”). Neither the Presentation nor any copy hereof may be copied,
distributed or delivered directly or indirectly to any person for any purpose without PKN ORLEN’s knowledge and consent. Copying, mailing, distribution or delivery of this
Presentation to any person in some jurisdictions may be subject to certain legal restrictions, and persons who may or have received this Presentation should familiarize
themselves with any such restrictions and abide by them. Failure to observe such restrictions may be deemed an infringement of applicable laws.
This Presentation contains neither a complete nor a comprehensive financial or commercial analysis of PKN ORLEN and of the ORLEN Group, nor does it present its position
or prospects in a complete or comprehensive manner. PKN ORLEN has prepared the Presentation with due care, however certain inconsistencies or omissions might have
appeared in it. Therefore it is recommended that any person who intends to undertake any investment decision regarding any security issued by PKN ORLEN or its subsidiaries
shall only rely on information released as an official communication by PKN ORLEN in accordance with the legal and regulatory provisions that are binding for PKN ORLEN.
The Presentation, as well as the attached slides and descriptions thereof may and do contain forward-looking statements. However, such statements must not be understood as
PKN ORLEN’s assurances or projections concerning future expected results of PKN ORLEN or companies of the ORLEN Group. The Presentation is not and shall not be
understood as a forecast of future results of PKN ORLEN as well as of the ORLEN Group.
It should be also noted that forward-looking statements, including statements relating to expectations regarding the future financial results give no guarantee or assurance that
such results will be achieved. The Management Board’s expectations are based on present knowledge, awareness and/or views of PKN ORLEN’s Management Board’s
members and are dependent on a number of factors, which may cause that the actual results that will be achieved by PKN ORLEN may differ materially from those discussed in
the document. Many such factors are beyond the present knowledge, awareness and/or control of the Company, or cannot be predicted by it.
No warranties or representations can be made as to the comprehensiveness or reliability of the information contained in this Presentation. Neither PKN ORLEN nor its directors,
managers, advisers or representatives of such persons shall bear any liability that might arise in connection with any use of this Presentation. Furthermore, no information
contained herein constitutes an obligation or representation of PKN ORLEN, its managers or directors, its Shareholders, subsidiary undertakings, advisers or representatives of
such persons.
This Presentation was prepared for information purposes only and is neither a purchase or sale offer, nor a solicitation of an offer to purchase or sell any securities or financial
instruments or an invitation to participate in any commercial venture. This Presentation is neither an offer nor an invitation to purchase or subscribe for any securities in any
jurisdiction and no statements contained herein may serve as a basis for any agreement, commitment or investment decision, or may be relied upon in connection with any
agreement, commitment or investment decision.
Disclaimer
14
For more information on PKN ORLEN, please contact Investor Relations Department:
phone: + 48 24 256 81 80
fax: + 48 24 367 77 11
e-mail: ir@orlen.pl
www.orlen.pl