Operating profit (EBITDA) of KMG International Group for the Q1 of 2018 amounted to 47 million US dollars
According to the audited financial statements, KMG International (KMGI or the Group) achieved positive operating and financial results in Q1 of 2018. During the reporting period, the Group registered its operating profit (EBITDA) of 47 million US dollars, which is 12% above that of the preceding year (41.8 million US dollars) and more than twice as high than the average EBITDA in Q1 over the past 6 years in 2012-2017 (19.7 million US dollars).
At the same time, net profit amounted to 8.5 million US dollars, which is 77% above the results of 2017 for the same period (4.8 million US dollars).
Q1 of 2018 broke a record in terms of operating efficiency which increased the level of maximum productivity achieved by the end of 2017. During the reporting period, the volume of processed raw materials at three KMGI production facilities in Romania - Petromidia and Vega refineries, and the Petrochemicals petrochemical complex - reached some 1.7 million tons which represented a 27% increase compared to the same period of 2017.
The volume of exported raw materials and petroleum products transshipped via trading channels made up 1.3 million tons which was 111% above that of 2017. Also, significant growth was shown by the volumes of wholesale and retail sales via internal and external channels which made up 1.9 million tons and was 60% above that of the preceding year (1.2 million tons).
In Q1 of 2018 gross turnover of KMGI reached 2.7 billion US dollars, which is 38% above that of 2017.
In general, such factors as an increase in the volumes of raw materials processing and sales of oil products in Romania and the region had a significant impact on the size and performance of net profit. At the same time, KMGI continues to implement programs to optimize and improve the cost-effectiveness of processing, logistics and sales, as well as the transformation of current activities in order to reduce operating costs and increase profitability
In particular, internal projects and programs for complex digitalization of production, launching capacities for the production of petrochemical and polymer products, installing additional depots and tanks in oil storage tanks, improving energy efficiency, expanding the fuel filling station chain in Romania and other countries of presence are in the active implementation stage.
“In 2018, we continued the implementation of internal programs aimed at the phased development and further diversification of business. First of all, these are low-cost initiatives in oil refining, trading and retail, bringing economic benefits immediately after their introduction, that is, the initiative of “quick wins”. The main growth driver was the achievement in the reporting period of new record indicators of operating efficiency and maximum productivity, exceeding the results achieved by the end of 2017. At the same time, the Program of Changes implemented by the company has a positive effect. This is a symbiosis of the best business practices and developments in the field of building effective models of corporate culture, as well as neurophysiology and psychology. The key role in it is assigned to creating a favorable working environment in the company and the values of each employee in the team, ”said Alexey Golovin, vice president for corporate development and strategy at KMG International.
As expected, the current development programs will be implemented by the Group in 2018 at its own expense.
It is to be recalled that in the past 2017, 10 years after integration into the KMG structure, the company achieved absolute records in its entire 40-year history. The further development goals of the Group are focused on diversifying business and expanding positions in the countries of Central and Eastern Europe and the Black Sea region.