One-off events which impact significantly ORLEN Group results for the first half of 2025

ORLEN S.A. („Company”, „ORLEN Group”) informs that as part of its work on the consolidated financial statement for the first half of 2025 it has identified grounds and conducted tests for impairment of assets according to international accounting standards (“IAS 36”). 

IAS 36 imposes an obligation to cyclical review of the present value of the future cash flows expected to be derived from the assets based on current and predicted macro and market environment conditions.

Impairments of assets are non-cash and are not directly linked to the ORLEN Group’s operating cash flow. 

As a results of the tests carried out, the Company predicts that in the consolidated financial statement for 2nd quarter of 2025 it will recognize:

• Reversal of impairment of assets in the total amount of PLN 0,7 bn in the Upstream & Supply segment of ORLEN S.A. mainly as a result of an increase in the production potential of existing deposits.

• Impairments of assets in the total amount of PLN 2,2 bn, including mainly:

o PLN 1,1 bn in the Upstream & Supply segment, mainly as a result of changes in macroeconomic conditions,

o PLN 1,0 bn in the Downstream segment, particularly as a result of the necessary CAPEX spent on the New Chemistry Project at ORLEN S.A. (PLN 0,8 bn) and the Hydrocracking Unit at ORLEN Lietuva (PLN 0,2 bn).

At the same time, the Company predicts that in the separate financial statement for 2nd quarter of 2025 it will include: 

• Reversal of impairment of assets in the total amount of PLN 0,7 bn in the Upstream & Supply segment,

• Impairments of assets in the total amount of PLN 1,9 bn which consists mainly of PLN 0,8 bn in the New Chemistry project and PLN 1,0 bn in the Upstream & Supply segment,

• Impairments of shares in the total amount of PLN 0,7 bn resulting from the loss of value of shares in LOTOS Upstream.

In the Downstream segment, the impairments result from assumptions of the difficult macroeconomic and market conditions, prepared on the base of the internal analysis with forecasts of widely-recognized data providers and product quotations. The Group is currently restructuring its assets in the Downstream segment in line with ORLEN Strategy 2035. 

CAPEX spent in 2025 on the newly re-established the New Chemistry  amounted to PLN 1,7 bn (in total, since the launch of the project in 2021 to 30 June 2025, including spending on the Olefins III, total CAPEX amounted to PLN 15,8 bn).

 

Impairments of assets related to the New Chemistry project (formerly Olefins III) were consequently recognized since 2023  and amounted to:

- In 2023: PLN 7190 m,

- In the 1st quarter of 2024: PLN 506 m,

- In the 2nd quarter of 2024: PLN 374 m,

- In the 3rd quarter of 2024: PLN 770 m,

- In the 4th quarter of 2024: PLN 5241 m, 

- In the 1st quarter of 2025: PLN 881 m, 

- In the 2nd quarter of 2025: PLN 760 m and resulted from the ongoing difficult conditions in global markets and structural changes in the petrochemical market.

The abovementioned one-offs and the estimations of results are currently under review by the auditor and may be subject to change in the final version of the ORLEN Group consolidated financial statements for the first half of 2025, which the Company will publish on 21 August 2025.