RWE Dea continues to grow
Operating result 2012 up to EUR 685 million
Capex investments remain at a high level of EUR 658 million
Further increase in base of reserves / contingent resources (discovered)
Following the successful preceding years, RWE Dea AG once again substantially improved its result: at EUR 685 million, the operating result exceeds that of the previous year by 23 per cent (2011: EUR 558 million). In fact, this is the best operating result in the company’s history as an upstream enterprise so far. The main reasons for the further substantial surge in earnings during the last financial year are reported to have been the slightly higher crude oil and gas prices as well as currency effects, but also lower costs thanks to successful exploration projects against the backdrop of production kept at a stable level. “Our balance sheet for 2012 proves that we stringently and successfully pursuing the growth track we embarked on,” emphasised Thomas Rappuhn, Chairman of the Board of Management of RWE Dea AG at today’s annual press conference in Hamburg.
Sales at RWE Dea grew to reach over two billion euros in 2012. The increase year-on-year amounts to roughly five per cent (or EUR 1.9 billion). Income before taxes were up by 39 per cent, to reach EUR 766 million (previous year: EUR 553 million); after-tax income grew by 164 per cent, to EUR 528 million (previous year: EUR 200 million). Net income amounted to EUR 525 million, likewise substantially exceeding the previous year’s level of EUR 197 million. “These figures are highly encouraging and show that we continue to grow,” says Chief Financial Officer Dr Johannes Karlisch.
RWE Dea Annual Press Conference 2013
Oil and total production almost at previous year’s level
In 2012, RWE Dea produced 2.6 billion cubic metres of gas and 2.4 million cubic metres of crude. Converted into oil equivalents (OE), total production came to 4.9 million cubic metres, slightly down on the previous year’s level (5.1 million m3 OE). As regards natural gas, production turned out slightly lower in the United Kingdom than in 2011 due to the natural production decline and project delays. In the case of crude oil, the natural production decline in the Mittelplate field made itself felt. “To stop this trend in our domestic production, in addition to various exploration projects we plan to re-commission legacy fields in Schleswig-Holstein and Lower Saxony. We still perceive interesting potential there,” reports the new Chief Operations Officer Dirk Warzecha.
Results benefit from crude oil and natural gas prices at a high level
Crude continued to be traded at very high prices on the international markets in 2012. The annual average price for a barrel of the reference oil Brent crude reached a level of around US$ 112 (2011: US$ 111). Whereas the weakening global economic growth had an impact on price trends, this was offset by the influence of geopolitical factors. The natural gas prices realised by RWE Dea reached an average of 25.3 euro cents/m3 in 2012, almost matching the previous year’s level of 25.5 euro cents/m3.
Investments remained at a high level
Capex investments reached a level of EUR 658 million in 2012, down by four per cent compared with the very high level in the previous year (EUR 688 million). In addition to project delays in North Africa, this was due to the investments cancelled in the Edvard Grieg field development project in Norway, which RWE Dea sold in autumn of 2012. “We are doing our utmost to continue our organic growth,” said Chief Financial Officer Dr Johannes Karlisch. “In order to achieve our objective of doubling our annual production, we are investing a great deal in current field development and in other highly promising exploration projects.”
The focal points of investment activity were above all on the successful exploration wells drilled in Norway as well as the Breagh, Devenick and Clipper South field developments in the United Kingdom. In Egypt, capex investments went into the Disouq field development and in Germany into plant and wells of the German oil and gas production operations. Chief Operations Officer Warzecha: “In 2012, we managed to advance major development projects to a decisive degree. We continue to work vigorously on the speedy development of reservoirs in order to boost the production of oil and gas substantially in the coming years.”
Further increase in base of reserves and contingent resources (discovered)
In 2012, RWE Dea succeeded in further extending the total reserves and resources (discovered) additionally for withdrawal from ongoing production to roughly 239 million cubic metres of oil equivalents (previous year: 237 million cubic metres). “With constantly improving drilling and production technology, in future we will also develop new resources in a wider international spectrum and use our existing ones safely and efficiently,” emphasised Warzecha. As in the preceding years, RWE Dea’s exploration activities were also extremely successful. “82 per cent of the costs incurred in exploration went into successful projects,” said Warzecha.
Further growth through new venture activities
To ensure and further extend production at a high level, RWE Dea is on the lookout for attractive opportunities to extend its portfolio and continues to expand its presence systematically in new regions. “In doing so, we assign importance to our ability to contribute our strengths and expertise in a targeted fashion to arrive at a good strategic balance of our portfolio,” Rappuhn explained. Beyond the existing focal regions in Europe, North Africa and the Caspian Sea region, RWE Dea also perceives good potential in other parts of Africa and in the region of Trinidad & Tobago.
Size of workforce slightly up on the previous year
At the end of December 2012, RWE Dea employed a workforce of 1,375, in terms of full-time equivalents. This was a slight increase in the number of employees compared with the previous year (2011: 1,362). As a technologically innovative international company, RWE Dea can offer highly attractive fields of activity to qualified employees. At the end of 2012, more than 30 per cent of RWE Dea’s employees were working outside Germany. In total, employees from 46 nations successfully collaborate at RWE Dea. Rappuhn: “The positive business development is being promoted by targeted recruitment and systematic personnel development.” Moreover, RWE Dea also has a commitment to further the social interests of the people at the Company and its surroundings.
Consistent field development and robust growth targeted
Thanks to new exploration success stories, RWE Dea has managed to extend its reserves and resources and will continue to implement its growth strategy embarked on in a targeted manner. Production is being extended through the realisation of field development projects already started as well as future field development projects. “Thanks to timely and cost-effective implementation of the many ongoing and pending projects, we plan to boost our production figures, operating result and key financial ratios in the next years,” says Thomas Rappuhn in summarising the Company’s prospects for the future. “RWE Dea and its workforce are proactively engaged in tackling the tasks that lie ahead in future.”
Source: RWE Dea
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