Business Forum • 12 August, 2024 at 8:35 AM
MOL Group announced its financial results for Q2 and H1 2024. In the first six months MOL Group delivered $916 mn profit before tax, marking a 19% increase year-on-year while in Q2 it reached $534 mn. Both Downstream and Upstream generated stable and reliable financial results thanks to steady demand on refining side and slightly higher hydrocarbon prices. Consumer Services' performance has been driven by fuel sales volumes and the further strengthening non-fuel margin.
Chairman-CEO Zsolt Hernádi commented the results: “Our company is under pressure in many ways. First, we need to ensure security of supply in the region in the long run. For that we are working day-in-and-out on securing all transportation options and maximizing our oil feedstock diversity and refinery flexibility. Second, we continue delivering our transformation agenda relying solely on our own resources as these diversity and transformation programs do not receive any kind of community funding. Third, we remain committed to delivering our long-term strategy to create value and provide return for our shareholders.
It is not easy to reach these goals especially as Government takes and regulatory burden in CEE add an extra stress on us. This is reflected by the fact that the contribution of our main Hungarian businesses has been marginal to the financial performance of MOL Group in 2024 so far. Despite all of these, I am very proud of MOL Group as our company continues to deliver stable and reliable performance in this unpredictable and volatile market environment. This demonstrates the resilience and strength of our company and our people.”
In Upstream, oil and gas production volume remained above guidance, totaling 92.1 mboepd in Q2 2024 thanks to higher international production in KRI Shaikan and Kazakhstan, supported also by the increase in both Hungarian and Croatian production quarter-on-quarter. Group unit OPEX stayed flat quarter-on-quarter at $5.8/boe due to strict cost control and favourable evolution of energy prices.
Downstream's results were driven by robust demand while the increase in refining margin countered the negative effects of the decrease in Brent-Ural spread. Petrochemicals' margin was slightly up quarter-on-quarter in line with lower energy prices. In Tiszaújváros, MOL has achieved two major milestones: the inauguration of the company's €1.3 billion polyol complex in May and the initiation of the design phase for a 40 ktpa chemical recycling unit.
In Consumer Services, stronger fuel sales volume and the improvement in non-fuel margin were the main drivers of the higher results, counterbalancing the effect of decreasing fuel unit margins. The accounting gain on the remedy handover of fuel stations also had a positive impact. Non-fuel margin represents 37.5% of the total margin in Q2 2024, up 3.9% points in comparison with the same period last year, supported by growth in gastro and grocery sales. The number of Fresh Corner sites rose to 1,270 in Q2 2024 from 1,180 in the same period last year.
Circular Economy Services marked a negative profit performance due to the conservative approach in cost accruals especially with regards to Depository Refund System (DRS) ramping up during the quarter and first time inclusion of MOHU Budapest JV's consolidated results. The DRS system is in operation since 1 January, with ~3,100 Reverse Vending Machine units installed and available at retail networks. As of 1 July, the DRS system started to operate countrywide, every day ~3 million beverage packaging is returned to circulation through the system.
Gas Midstream's performance was marked by the combined effect of milder weather conditions, changing demand in regional transmission services and unfavourable FX changes.