Russian oil producer Rosneft said profit slumped in the first quarter as crude prices hit its bottom line
Net income dropped to 14 billion rubles in the first three months of the year compared to 56 billion rubles in the same period a year earlier the company said as it published its results from quarter one 2016.
Revenue fell 21% to RUB1.05trillion.
Earnings before interest, taxes, depreciation and amortisation declined to 273 billion rubles from 319 billion rubles in the first quarter of last year.
Rosneft chairman Igor Sechin, said: “With remaining inflation process in the economy and negative market conditions the Company improved the implementation of strategic initiatives with the focus on the business efficiency.”
Lifting costs were down to 155 RUB/boe ($2.1/boe) in quarter one 2016 compared to quarter four 2015 and quarter one 2015, which contributed to improvement in EBIDTA margin.
Sechin hailed Rosneft’s strong lead in upstream capex and opex at $4.1/boe and $2.1/boe, respectively, with Russian and foreign peers exceeding the company’s levels by 2-8 times.
The company keeps generating positive free cash flow despite capex went up by 20% driven by intensive development of new projects in upstream.
“In conditions of negative macroeconomic environment the company sustains stable level of operating cash flow which supports financing of planned capital investments and timely meeting of all liabilities,” he said.
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