ORLEN Group to invest PLN 3.5 billion in strategic programme to upgrade electricity distribution network

The ORLEN Group will implement a strategic investment program in the field of energy distribution networks, increasing the security and efficiency of electricity supplies in northern and central Poland. Financing for the program will be provided by the European Investment Bank (EIB), which has approved a PLN 3.5 billion loan to ORLEN to support the strategic development of its electricity distribution infrastructure, including renewable energy (RES) connections, network upgrades, and investments in smart grid technology. This EIB financing, offered on preferential terms compared to commercial banks, will significantly accelerate the implementation of plans in this area. The initial financing agreement signed is valued at PLN 900 million. The programme will be implemented by Energa Operator.

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ORLEN Group consolidated results for Q2 2024

Despite mounting macroeconomic pressures, the ORLEN Group closed the second quarter of 2024 posting LIFO-based EBITDA, adjusted for the effects of regulations, of PLN 11.3 billion, up by 8% y/y. The Group’s performance was supported by the energy segment as well as being driven by improved volumes in the upstream segment, which helped offset the impact of macroeconomic headwinds. In the first half of this year, the ORLEN Group allocated PLN 14 billion to investments supporting the energy transition and bolstering Poland’s energy security.

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ORLEN Group consolidated results for Q1 2024

In the three months ended 31 March 2024, the ORLEN Group generated LIFO-based EBITDA* of PLN 8.4 billion and net profit of PLN 2.8 billion. The stable financial results were delivered with a PLN 1 billion q/q reduction in net debt. Over the period, the Group invested nearly PLN 6.4 billion across all its business lines. The retail segment saw a 20% y/y increase in sales reflecting growing demand in Poland and the Group’s entry into a new market with the acquisition of over 260 fuel stations in Austria. The energy segment’s performance remained stable, its electricity output from renewable and low-carbon sources upped to nearly 70%.

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ORLEN’s hydrogen mobility project with unprecedented EU support

The ‘Clean Cities – Hydrogen mobility in Poland’ project implemented by ORLEN has been backed by the largest grant ever awarded by the European Union for hydrogen innovation, totalling EUR 62m of non-repayable funding. The EU funds will support an ambitious agenda to erect 16 hydrogen refuelling stations available to the public across various regions of Poland and to establish a green renewable hydrogen production facility, leveraging an advanced water electrolysis process powered by renewable energy.

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ORLEN Group consolidated results for Q4 2023

In the three months ended 31 December 2023, the ORLEN Group generated LIFO-based EBITDA* of PLN 11.2bn and net profit of PLN 7.3bn. The full-year LIFO-based EBITDA* for 2023 was PLN 44.8bn and net profit reached PLN 27.6bn. The Group’s fourth-quarter results were positively impacted by the performance of the gas segment, which delivered an EBITDA of PLN 11bn, primarily on the back of lower gas procurement costs and higher sales. ORLEN also increased its retail sales volumes by more than 20% (y/y), partly as a result of the acquisition of service stations in Hungary and Slovakia.

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Consolidated Q3 2023 results posted by the combined ORLEN Group

In the three months ended September 30th 2023, the ORLEN Group generated LIFO-based EBITDA of PLN 8.2bn and net profit of PLN 3.5bn. This means that on a year-to-date basis, for the first nine months of 2003, the Group’s operating profit reached PLN 34bn and net profit was more than PLN 17bn. In the third quarter of 2023, despite macroeconomic headwinds, the Refining segment contributed positively to the Group’s performance, posting LIFO-based EBITDA of PLN 1.9bn. The contribution from Petrochemicals was negative, which was due to lower demand for petrochemical products. In the Retail segment, ORLEN reported improved sales volumes in the third quarter. In the Polish market alone, they expanded by 9% year on year. The Group’s financial ratios were maintained at safe levels, with PLN 20.4bn allocated to capital expenditures during the nine months to September 30th.

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The results of the combined ORLEN Group for the second quarter of 2023

The retail segment’s contribution to ORLEN Group’s second-quarter result was modest again due to factors including a decline in fuel margins. Sales at fuel stations in Poland represented merely around 1% of LIFO-based EBITDA from the beginning of the year. Also sales of the refining segment more than halved compared with the prior quarter. The combined ORLEN Group generated around PLN 75bn in revenue, with a net profit margin of only 6% (PLN 4.5bn). This proportion is close to the level posted prior to the war in Ukraine. The result was achieved through consolidation with Grupa LOTOS and PGNiG, and best reflects the strong position of the ORLEN Group, which was one of the five fastest advancing companies in the Fortune Global 500 ranking. The scale-up of the combined ORLEN Group’s operations also increases tax revenue streams to the state budget. As Poland’s largest tax payer, ORLEN has already paid PLN 36.5bn in taxes in the first six months of this year, about PLN 20bn more than in the same period last year. This means that with the completed acquisitions and investment projects underway, a large and strong ORLEN genuinely contributes to the sustainable economic and social advancement of Poland.

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First-quarter 2023 earnings delivered by combined ORLEN Group support execution of strategic investments in reliable and affordable energy

Retail segment’s contribution to the ORLEN Group’s first-quarter result was insignificant due to a decline in fuel margins, among other factors. Sales at service stations in Poland accounted for just around 1% of LIFO-based EBITDA. Earnings of the refining segment were also down by half compared with the prior quarter. The combined ORLEN Group generated more than PLN 110bn in revenue, with a net profit margin of only 8% (PLN 9.2bn), with the proportion close to the level posted prior to the war in Ukraine. The Group invests its profits. This year, it will spend a record amount of PLN 36bn on projects aimed to permanently improve Poland’s and the region’s energy security and independence. Zero- and low-carbon power generation projects will be continued. The scale-up of the combined ORLEN Group’s operations will also increase tax revenue streams to the state budget. In the first three months of 2023, PKN ORLEN – Poland’s largest tax payer – already paid PLN 16.5bn to the public purse, significantly contributing to the country’s economic and social development.

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Post-merger fourth-quarter 2022 results posted by ORLEN Group provide solid foundation to support economic growth and enhance energy security for Poland

Sales at Polish fuel stations were not a significant contributor to the ORLEN Group’s overall performance in the fourth quarter of 2022, accounting for just around 3% of its total LIFO-based EBITDA. For the first time, the reported results reflected the consolidated performance of four companies: PKN ORLEN, Energa, LOTOS and PGNiG. In the three months to December 31st 2022, the combined ORLEN Group generated more than PLN 100bn in revenue, with a net profit margin of only 8% (PLN 8.1bn*). The fact that the ORLEN Group currently enjoys stable revenue levels is attributable, among other things, to the elimination of illegal fuel trade, which before 2016 had a negative impact on the performance of legally operating fuel companies in Poland. In 2022 alone, the ORLEN Group paid PLN 39bn in taxes to the state budget, an increase of about PLN 13bn on 2015. Throughout 2022, the ORLEN Group spent PLN 19.6bn on projects seeking to permanently improve energy security and independence, including renewable energy development projects. The massive capital spending programme was enabled by the mergers and profits delivered by the Group.

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