Ecopetrol Announces Its Results for the First Quarter of 2014

 

 

Highlights of Ecopetrol S.A.'s financial results
Unconsolidated
(COP$ Billion)	1Q 2014 *	4Q 2013*	Var. %	1Q 2013*	Var. % **
Total sales	15,741.7	16,201.3	( 2.8%)	14,771.8	6.6%
Operating profit	4,552.6	4,077.4	11.7%	5,145.3	(11.5%)
Net Income	3,225.9	2,629.7	22.7%	3,495.7	(7.7%)
Earnings per share (COP$)	78.46	63.96	22.7%	85.02	(7.7%)
EBITDA	7,704.6	5,268.4	46.2%	7,746.0	(0.5%)
EBITDA Margin	49%	33%		52%
Consolidated
(COP$ Billion)	1Q 2014 *	4Q 2013*	Var. %	1Q 2013*	Var. % **
Total sales	18,262.0	17,960.2	1.7%	16,745.7	9.1%
Operating profit	5,882.8	4,209.7	39.7%	5,553.9	5.9%
Net Income	3,287.4	2,426.5	35.5%	3,411.7	( 3.6%)
EBITDA	7,793.0	4,901.4	59.0%	7,596.5	2.6%
EBITDA Margin	43%	27%		45%
* Not audited
** Between 1Q 2014 and 1Q 2013

In the opinion of Ecopetrol S.A.'s CEO, Javier Gutierrez:

The financial results of the first quarter of 2014 were better compared with those from the fourth quarter of 2013. The unconsolidated net income as well as the Ebitda increased 22.7% and 46.2% respectively.

The results of the first quarter of 2014 reflected the difficult operating conditions: there were 33 attacks on infrastructure, and blockades by some communities in different regions across Colombia. Due to this situation, we have experienced delays in execution of some E&P projects. In midstream, the operation of the Bicentenario oil pipeline has remained disrupted since February 20 and in the Cano Limon – Covenas pipeline since March 25. As a consequence, average production reached 765.7 mboed falling 3.2% compared to the first quarter of 2013, and 1.8% compared to the last quarter of 2013.

The dollar sales price of crude, products and gas declined 8.1%, 5.3% and 16.3%, respectively, versus the same period of 2013, as the result of international market conditions.

Higher variable costs were generated due to higher transportation fees, the cost of transporting by truck, increased purchases of ultra-low sulfur content diesel and diluent, among others.

The better results for the companies of the Corporate Group, came from the Transportation and Exploration and Production segments, the latter posting a 5.0% growth in production.

We had several highlights during the quarter such as the discovery in the well Tibirita 1A in Llanos Orientales, the 11 most competitive bids for the blocks in Lease 231 in the Gulf of Mexico (U.S.), the 55 thousand barrel increase in the capacity of the San Fernando–Monterrey transport system, the achievement of 89% completion in the Reficar modernization project, and the two patents in Colombia for the production of biofuels. Additionally we also highlight the progress in projects such as the water flooding pilot in the Galan field and the CEOR at the Yarigui field.

We are advancing in the initiatives to improve operating conditions, and the progress in the capex plan, which includes close cooperation and coordination with Government agencies such as the Military Forces, the Labor Ministry and Local governments. We have also created a multidisciplinary team with the objective of prioritizing the key project execution steps.

As a closing, I would like to reiterate our commitment to overcome the operational difficulties and move forward with the projects that will allow us to continue along the path of growth."

The complete report is available in www.ecopetrol.com.co

Ecopetrol is Colombia's largest integrated oil & gas company, where it accounts for 60% of total production. It is one of the top 50 oil companies in the world and the fourth largest oil company in Latin America. The Company is also involved in exploration and production activities in Brazil, Peru and the United States Gulf Coast, and owns the main refineries in Colombia, most of the network of oil and multiple purpose pipelines in the country, petrochemical plants, and is entering into the biofuels business.

This release contains forward-looking statements relating to the prospects of the business, estimates for operating and financial results, and those related to growth prospects of Ecopetrol. These are merely projections and, as such, are based exclusively on the expectations of management concerning the future of the business and its continued access to capital to fund the Company's business plan. Such forward-looking statements depend, substantially, on changes in market conditions, government regulations, competitive pressures, the performance of the Colombian economy and the industry, among other factors; therefore, they are subject to change without prior notice.

[1] Some figures in this release are presented in U.S. dollars (US$), as indicated. The financial results in the main body of this report have been rounded to one decimal place. Figures presented in COP$ billion are equivalent to COP$1 thousand million (COP$1,000,000,000). Additionally, some 2013 figures have been reclassified to be comparable to those of 2014.