OMV posts first-quarter loss and lowers yearly production target

Share On Facebook
share on Linkedin

Austrian energy group OMV posted a net loss for the first quarter due to high inventory costs. It has also lowered its production target and crude price forecasts in response to the fall in oil demand.

OMV said it lost €68 million ($74 million) in the three months to the end of March after making a profit of €496 million in the same period a year ago.

With economies around the world locked down and travel halted to contain the coronavirus pandemic, storage capacities are filling up globally, causing extra cost for energy companies.

Clean current cost of supplies (CCS) earnings before interest and tax (EBIT), which exclude special items and inventory gains or losses, fell 8 per cent in the quarter to €699 million. This is above an average estimate of €573 million in an OMV poll of 15 analysts.

Oil prices sank 65 per cent in the first three months of 2020 to lows of $22 a barrel as strict movement restrictions led to a collapse in demand for transportation fuels.

OMV said it expects the Brent oil price to average $40 per barrel this year and saw the realised gas price at €11.9 per megawatt hour.

The company now sees its 2020 output at around 440,000 barrels of oil equivalent per day instead of its previous target of 500,000.

Chief executive Rainer Seele has said he was considering reducing working hours for OMV staff and shutting down a refinery due to the fall in demand.

The group, which has a global workforce of around 20,000, announced last month it would cut spending by about 20 per cent this year. It said it had reached a deal to pay in stages for its stake purchase in plastics maker Borealis to free up cash.

To fund the $4.7 billion acquisition, OMV plans to sell $2.3 billion of assets by the end of next year.


Brent Crude Oil:

CLICK HERE TO REGISTER FOR FREE ON ADVFN, the world's leading stocks and shares information website, provides the private investor with all the latest high-tech trading tools and includes live price data streaming, stock quotes and the option to access 'Level 2' data on all of the world's key exchanges (LSE, NYSE, NASDAQ, Euronext etc).

This area of the site is for independent financial commentary. These blogs are provided by independent authors via a common carrier platform and do not represent the opinions of ADVFN Plc. ADVFN Plc does not monitor, approve, endorse or exert editorial control over these articles and does not therefore accept responsibility for or make any warranties in connection with or recommend that you or any third party rely on such information. The information available at is for your general information and use and is not intended to address your particular requirements. In particular, the information does not constitute any form of advice or recommendation by ADVFN.COM and is not intended to be relied upon by users in making (or refraining from making) any investment decisions. Authors may or may not have positions in stocks that they are discussing but it should be considered very likely that their opinions are aligned with their trading and that they hold positions in companies, forex, commodities and other instruments they discuss.

Leave A Reply

Do you want to write for our Newspaper? Get in touch:

By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions

P: V: D:20220926 18:13:47