PVN defies the odds to pass annual targets

Total revenue for PetroVietnam and its affiliates in 2013 soared to a combined VND762.86 trillion (US$36.33 billion), 18 per cent higher than the target set for the year, Hong said at the group's annual business review meeting in Ha Noi.— VNA/VNS Photo

HA NOI (Biz Hub)— Viet Nam National Oil and Gas Group (PetroVietnam) has completed all its targets and set new records despite an economic downturn, PetroVietnam's deputy general director, Le Minh Hong, announced on Tuesday.

Of the combined revenue, PetroVietnam accounted for VND384.4 trillion ($18.3 billion), which represented a year-on-year increase of nine per cent.

PetroVietnam's chairman, Phung Dinh Thuc, said the results were impressive given the challenges in the domestic and global markets.

Last year, the group contributed VND195.4 trillion ($9.3 billion) to the State budget, which was 4.5 per cent higher than a year ago and 31.5 per cent higher than the target.

Total pre-tax profit climbed to VND62.8 trillion ($3 billion), which represented a year-on-year increase of 27.5 per cent. The return on equity (ROE) was 17.1 per cent, while the total-debt-to-total-asset ratio was 0.4 times, indicating a secure financial situation for PetroVietnam.

Last year, the group's total output from oil and gas exploration was up five per cent over the previous year, reaching 26.46 million tonnes of oil equivalent (TOE). Oil output accounted for 16.71 million TOE, a 4.4 per cent increase compared with the target set for the year. The gas output was six per cent higher than the target, reaching 9.75 billion cubic metres.

The group also signed four new contracts and seven agreements. It discovered five new oil fields, while nine oil fields became operational.

Last year, PetroVietnam generated and transmitted 16.17 billion kWh of power to the national electricity grid, surpassing its target by 16.7 per cent.

"Last year, electricity generation made profits for the first time," he added.

Petrol output was 6.6 million tonnes, 22.5 per cent higher from the initial goal.

Revenue from petrol services increased to VND236.3 trillion ($11.25 billion), accounting for 31 per cent of the group's total revenue.

In 2013, PetroVietnam reported a total investment of VND76.5 trillion ($3.6 billion), from which VND7 trillion ($333 million) was disbursed.

The group completed investments in 42 projects that started operating during the year.

It has also been implementing a restructuring plan approved by Prime Minister Nguyen Tan Dung aimed at introducing drastic measures at the group and its affiliates.

The strong set of results is likely to enable the company to complete its targets for 2014 ahead of schedule.

Thuc said PetroVietnam estimates oil and gas reserves to increase to 55-61 million TOE this year, 20 per cent higher than the target set by the Government.

Petrol exploitation was expected to reach 26.63 million TOE; crude oil would account for 16.21 million TOE, while gas would account for 9.8 million tonnes.

It will strive to generate VND673.3 trillion ($32 billion) in revenue in 2014 and contribute VND144.5 trillion ($6.9 billion) to the State budget.

Its pre-tax profit is estimated at VND55 trillion ($2.6 billion) this year.

The chairman said PetroVietnam has implemented projects in foreign countries, such as Russia, Peru, Venezuela and Malaysia. The enterprise would increase its overseas investments as it searches for new oil fields in accordance with its resources and business plans.

Responding to a question on the divestment (sell-off) of its non-core businesses, he said PetroVietnam would continue to support its affiliates' efforts to raise capital at the best prices.

Accordingly, the PetroVietnam Finance Company (PVFC) joined hands with the Western Bank to establish PVCombank. PetroVietnam's capital in the bank after the merger was reduced from 78 per cent to 52 per cent. It will continue to reduce its capital in the bank, according to an earlier plan.

"Our target is to provide favourable conditions for the bank to operate effectively, thus reducing our share in the bank's capital at the possible best price. This will ensure the group's financial results are not affected," he added.

Ocean Bank could also undergo a divestment process by 2015, with the aim of raising capital at the best possible price. — VNS