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Ecopetrol Announces Results for the Second Quarter and First Half of 2009
- Oil and natural gas production rose 9.7% for the second quarter of 2009; Ecopetrol's organic production in June reached 504.2 thousand BOE/D.
- Volumes sold increased 16.4% in the second quarter of 2009, driven by higher oil and gas production and purchases.
- Unconsolidated operating profit was COP 2,132.28 billion for the second quarter of 2009, compared to COP 1,020.91 billion for the first quarter of 2009.
- Unconsolidated net profit reached COP 762 billion for the second quarter of 2009, equivalent to COP 18.83 per share.
- Unconsolidated net profit reached COP 2.371,27 billion for the first half of 2009, equivalent to COP 58.59 per share.
- The Company began the integration of acquisitions made during the first quarter of 2009 worth USD 1.99 billion.
- On May 26, Ecopetrol obtained a loan for COP 2.2 trillion through a syndicated local bank.
Results for second quarter of 2009 compared to results of second quarter of 2008
(Logo: http://www.newscom.com/cgi-bin/prnh/20090209/ARM001LOGO )
Below is a summary of Ecopetrol's unconsolidated financial results:
(In billions of COP)
Unconsolidated Unconsolidated
2Q09 2Q08 % 1st Half 09 1st Half 08 %
Total Sales 6685.5 9424.8 -29.1% 11798.3 16647.2 -29.1%
Operating
Profit 2132.3 4384.8 -51.4% 3153.2 8150.5 -61.3%
Net Income 762.0 3356.7 -77.3% 2371.3 5650.0 -58.0%
Earnings per
Share(COP) 18.83 82.94 -77.3% 58.59 139.60 -58.0%
EBITDA 2807.6 4823.2 -41.8% 4436.9 9024.4 -51.8%
EBITDA Margin 42% 51% 38% 54%
1 Pursuant to the RCP, Colombian companies only have the obligation to consolidate their financial statements at the end of each fiscal year. Therefore, figures in this report do not constitute a formal consolidation of Ecopetrol's financial statements. However, they do present an estimated consolidation of Ecopetrol's financial statements.
Commenting on the second quarter 2009 results,
We continued to successfully implement our strategic plan, increasing
production to 504.2 thousand BOE/D in June. This significant milestone toward
our goal of producing the equivalent of one million barrels of oil by 2015 was
achieved six months ahead of schedule. We strengthened our exploratory
activities in the second quarter by increasing our portfolio of prospects in
All of the strategic acquisitions announced during the first quarter were
completed and we began their integration in the second quarter. We recently
entered the debt market, raising
Market Environment
The second quarter was marked by the first signs of a global economic
recovery, which impacted commodity prices and exchange rates in emerging
countries as investors again took positions in those markets. The exchange
rate appreciated by 15.7% during the quarter (from USD/
Sales Volume
Domestic Sales Volume 2Q09 2Q08 %
(thousands BOE/D)
Crude Oil 79.1 74.7 5.8%
Natural Gas 69.1 63.3 9.2%
Gasolines 59.1 61.9 -4.5%
Medium Distillates 93.1 95.3 -2.3%
LPG and Fueloil 19.3 20.5 -6.1%
Industrial and Petrochemical
Products 14.3 14.5 -1.6%
Total Domestic Sales 333.9 330.2 1.1%
Exports Volume
(in thousand BOE/D) 2Q09 2Q08 %
Crude Oil 216.7 142.1 52.5%
Products 55.5 51.5 7.8%
Natural Gas 26.4 19.5 35.5%
Total Export Sales 298.6 213.1 40.1%
Total Volume Sold 632.5 543.3 16.4%
Domestic sales volume 1st Half 09 1st Half 08 %
(in thousand BOE/D)
Crude Oil 81.4 73.9 10.1%
Natural Gas 66.0 65.6 0.7%
Gasolines 59.7 62.3 -4.2%
Medium Distillates 91.7 91.8 -0.2%
LPG and Fuel oil 20.1 20.2 -0.7%
Industrial and Petrochemical
Products 14.1 16.2 -12.7%
Total Domestic Sales 332.9 330.0 0.9%
Exports Volume
(in thousand BOE/D) 1st Half 09 1st Half 08 %
Crude Oil 200.4 137.0 46.3%
Products 56.0 47.9 16.9%
Natural Gas 24.7 13.9 77.7%
Total Export Sales 281.1 198.8 41.4%
Total Volume Sold 614.0 528.8 16.1%
Total sales volume rose 16.4% during the second quarter of 2009 as compared to the same period in 2008 due to an 85.5 thousand BOE/D increase in exports. The largest increases were in Castilla crude exports (120%), and natural gas exports (35.5%). For the first half of 2009 as compared to the first half of 2008, there was a 16.1% increase due to a 41.4% increase in exports.
Domestic sales increased slightly by 3.7 thousand BOE/D from the second quarter of 2009 as compared to the second quarter of 2008 due mainly to a 5.8 thousand BOE/D rise in natural gas sales resulting from larger consumption in the thermal energy sector, and a 4.4 thousand BPCD increase in crude oil sales to the Cartagena Refinery, which helped offset the 5 thousand BPD decline in gasoline and medium distillate sales. For the first half of 2009 compared to the same period in 2008, there was a 0.9% increase in domestic sales resulting from greater sales of crude oil to the Cartagena Refinery.
The lower domestic consumption of refined products was due to an increase in the distribution of gasoline with 10% ethanol, greater restrictions on the use of vehicles in several Colombian cities, and the conversion of vehicles to natural gas as a result higher domestic gasoline prices as compared to natural gas prices for vehicles.
The availability of Ecopetrol crude oil and products included the following purchases and imported volumes:
Purchases(in thousand BOE/D) 2Q09 2Q08 %
Crude Oil 165.4 137.9 19.9%
Refined Products 9.8 6.5 50.9%
Natural Gas 37.6 31.6 19.2%
Total Purchases 212.8 175.9 20.9%
Imports (in thousand B/D) 2Q09 2Q08 %
Crude Oil 0 0 0%
Products 37.5 28.1 33.5%
Total imports 37.5 28.1 33.5%
Purchases
(in thousand BOE/D) 1st Half 09 1st Half 08 %
Crude Oil 162.7 137.7 18.2%
Refined Products 8.5 4.8 76.8%
Natural Gas 36.0 31.5 14.4%
Total Purchases 207.3 174.0 19.1%
Imports (in thousand B/D) 1st Half 09 1st Half 08 %
Crude Oils 0.0 0.4 -100%
Products 35.5 23.7 49.8%
Total Imports 35.5 24.1 47.1%
Unconsolidated Financial Results
Unconsolidated Profit and Loss Statement
(In billions of COP)
2Q09 2Q08 % 1st Half 09 1st Half 08 %
Domestic Sales 3438.6 5838.6 -41.1% 6592.4 10385.5 -36.5%
Export Sales 3015.3 3360.3 -10.3% 4738.3 5821.6 -18.6%
Services Sales 231.7 225.8 2.6% 467.6 440.1 6.2%
Total Sales 6685.5 9424.8 -29.1% 11798.3 16647.2 -29.1%
Variable Costs 2674.4 3473.5 -23.0% 5259.9 5690.3 -7.6%
Fixed Costs 1326.2 1232.4 7.6% 2416.8 2159.0 11.9%
Cost of Sales 4000.6 4705.8 -15.0% 7676.7 7849.2 -2.2%
Gross Profit 2685.0 4718.9 -43.1% 4121.5 8798.0 -53.2%
Operating
Expenses 552.7 334.2 65.4% 968.3 647.5 49.6%
Operating Profit 2132.3 4384.8 -51.4% 3153.2 8150.5 -61.3%
Non-operating
Profit (Loss) -1030.3 394.2 -361.4% 163.3 -242.9 167.2%
Provision for
Income Tax 340.0 1422.3 -76.1% 945.2 2257.6 -58.1%
Net Income 762.0 3356.7 -77.3% 2371.3 5650.0 -58.0%
Earnings per Share
(COP) 18.83 82.94 -77.3% 58.59 139.60 -58%
EBITDA 2807.6 4823.2 -41.8% 4436.9 9024.4 -50.8%
EBITDA Margin 42% 51% 38% 54%
While international prices improved during the second quarter of 2009,
they continued to be below those of the comparable period in 2008. This
resulted in a decline in the average price of the crude oil export basket from
Lower prices during the second quarter of 2009 led to a 29.1% decrease in
total sales, from
The differential between the crude oil basket and WTI improved from an
average of
The export product basket differential with WTI also improved from an
average of
Cost of sales decreased 15.0% in second quarter 2009 compared to the second quarter of 2008 due to a 23.0% decline in variable costs, which (partially) offset a 7.6% increase in fixed costs. For the first half of the year 2009, cost of sales decreased 2.2% as compared to the same period in 2008.
The decrease in variable costs was mainly due to the lower value of crude
oil purchases, whose average price decreased from
Fixed costs increased 7.6% in the second quarter of 2009 compared to the same period in 2008, mainly as a result of increases in operating maintenance costs, and well reconditioning costs, as well as higher hydrocarbon transport costs stemming from the increased use of trucks to transfer higher quantities of heavy crude oils from the Rubiales field.
The Company continued to implement its strategy of optimizing goods and
decreasing services' supply costs, which prevented an estimated cost of
Gross profit was
Operating expenses increased 65.4% in the second quarter of 2009 compared
to the second quarter of 2008 as a result of the following two factors: (i) a
207.4% increase in exploration and project expenses due to the recognition of
unsuccessful exploratory activities, mainly
The operating profit for the second quarter of 2009 decreased as compared
to the operating profit of the second quarter of 2009, and was
Non-operating profit decreased 361.4% compared to the second quarter of
2008 due to a
Net profit for the second quarter 2009 was
EBITDA totaled
General Balance Sheet
Unconsolidated General Balance Sheet
As of June As of March
In billions of COP 2009 2009 %
Current Assets 14,053.5 18,497.0 -24.0%
Long Term Assets 36,056.1 34,854.8 3.4%
Total Assets 50,109.6 53,351.8 -6.1%
Current Liabilities 12,728.5 18,016.0 -29.3%
Long-Term Liabilities 9,204.1 7,604.1 21.0%
Total Liabilities 21,932.6 25,620.1 -14.4%
Shareholders' Equity 28,177.0 27,731.8 1.6%
Total Liabilities and
Shareholders' Equity 50,109.6 53,351.8 -6.1%
Memorandum Accounts* 135,399.68 168,298.71
As of
Liabilities at
Shareholders' equity rose from
Cash Position
As of
Results by Segment
Quarterly Results by Segment
In billions of COP E&P Refining
2Q09 1Q09 2Q09 1Q09
Domestic Sales 2512.0 1812.9 2614.2 2366.9
Exports 1579.2 551.3 526.7 395.5
Total Sales 4091.2 2364.3 3140.9 2762.4
Operating Profit 1995.2 925.3 -98.5 17.3
Net Income 1421.3 755.3 -77.7 188.8
Quarterly Results by Segment
In billions of COP Transportation Marketing and Sales
2Q09 1Q09 2Q09 1Q09
Domestic Sales 519.1 488.6 1054.1 944.9
Exports 0 0 909.4 776.2
Total Sales 519.1 488.6 1963.5 1721.1
Operating Profit 137.7 164.5 148.5 -77.6
Net Income 87.9 137.1 140.1 -51.7
Quarterly Results by Segment
In billion
COP E&P Corporate TOTAL ECP
2Q09 1Q09 2Q09 1Q09
Domestic Sales -3029.2 -2223.6 3670.1 3389.7
Exports 0 0 3015.3 1723.1
Total Sales -3029.2 -2223.6 6685.3 5112.8
Operating Profit -50.6 -8.6 2132.3 1020.9
Net Income -809.6 579.7 762.0 1609.3
Accumulated Results by Segment
Billions of COPs
E&P Refining Transportation
As of June As of June As of June
2009 2009 2009
Domestic Sales 4325.0 4981.0 1007.6
Export Sales 2130.5 922.2 0
Total Sales 6455.5 5903.3 1007.6
Operating Profit 2920.5 -81.2 302.2
Net Income 2176.7 111.0 225.0
Accumulated Results by Segment
Billions of COPs
Marketing &
Sales Corporate TOTAL ECP
As of June As of June As of June
2009 2009 2009
Domestic Sales 1999.0 -5252.8 7059.7
Export Sales 1685.7 0 4738.4
Total Sales 3684.6 -5252.8 11798.1
Operating Profit 70.9 -59.2 3153.2
Net Income 88.5 -229.9 2371.3
The segment report is calculated on the basis of transfer prices among business units, using export parity prices as reference. In addition, the methodology assigns fixed discounts for crude oil that the Marketing and Sales segment provides to the Barrancabermeja refinery.
The Exploration and Production segment contributed 91.8% to accumulated
net profit in the amount of
The Refining segment accumulated a
The Transportation segment recorded an accumulated net profit of
The Marketing and Sales segment had an accumulated net profit of
The Corporate segment reported an accumulated net loss of
Consolidated Financial Results
Pursuant to the RCP, Colombian companies only have the obligation to consolidate their financial statements at the end of each fiscal year. Therefore, figures in this report do not constitute a formal consolidation of Ecopetrol's financial statements. However, they do present an estimated consolidation of Ecopetrol's financial statements.
For purposes of the estimated consolidation of Ecopetrol's financial statements for second quarter and first half 2009, in addition to Ecopetrol S.A. results, the following companies were included:
In the Upstream Area: Ecopetrol Oleo e Gas Do Brasil, Ecopetrol America Inc, Ecopetrol del Peru S.A., and Hocol.
In the Downstream area: Bioenergy S.A., Andean Chemicals Limited, ECP
Global Energy, Propilco S.A., Comai, ODL Finance S.A., Ecopetrol
Transportation Company, Oleoducto de
For the second quarter and the first half of 2008, the following companies were included: Ecopetrol S.A. Black Gold Re Ltd, Ecopetrol Oleo e Gas Do Brasil, Ecopetrol America Inc, Ecopetrol del Peru S.A., Andean Chemicals Ltd, Propilco, and Comai.
Consolidated Profit and Loss Statement with Subsidiaries*
In billion
COP 2Q09 2Q08 % 1st Half 09 1st Half 08 %
Domestic Sales 3500.3 6031.7 -42.0% 6687.5 10578.6 -36.8%
Export Sales 3544.5 3484.5 1.7% 5361.6 5950.0 -9.9%
Services Sales 231.7 225.8 2.6% 467.6 440.1 6.2%
Total Sales 7276.5 9742.0 -25.3% 12516.6 16968.7 -26.2%
Variable Costs 2742.5 3755.6 -27.0% 5329.8 5690.3 -6.3%
Fixed Costs 1942.3 1232.4 57.6% 3112.9 2441.8 27.5%
Cost of Sales 4684.8 4988.0 -6.1% 8442.7 8132.0 3.8%
Gross Profit 2591.7 4754.0 -45.5% 4073.9 8836.7 -53.9%
Operating
Expenses 490.8 350.5 40.0% 910.4 663.8 37.1%
Operating Profit 2101.0 4403.5 -52.3% 3163.5 8172.9 -61.3%
Non-Operating
Profit (Loss) -1067.3 394.3 -370.7% 105.3 -246.5 -142.7%
Provision for
Income Tax 348.7 1426.2 -75.6% 975.3 2261.5 -56.9%
Minority
Interest 7.2 0.0 0.0% -7.2 0.0 0.0%
Net Income 692.3 3371.6 -79.5% 2300.7 5664.9 -59.4%
EBITDA 3134.1 4841.9 -35.3% 4,889.7 9,046.8 -46.0%
EBITDA Margin 43% 50% 39% 53%
* These values are included for reference purposes only
With respect to total sales for second quarter 2009, the greatest
contributions by individual subsidiaries (without taking into account the
effect of deletions) came from Refineria de
Consolidated net profit was
Among subsidiaries, the greatest net profits came from Hocol with
Consolidated EBITDA totaled
Accumulated EBITDA was
Significant Aspects of the Strategic Plan financing
To support the development of the Strategic Plan, the Company announced an
estimated financing requirement of up to
In
Additionally, on
Ecopetrol's corporate debt was rated BB+ with a stable outlook by the risk-rating agencies Standard & Poor's and Fitch, while Moody's rated the Company's corporate credit risk in local currency Baa2 with a stable outlook, which placed Ecopetrol in the investment grade category.
Exploration
In the second quarter, as part of its internationalization and risk
diversification strategy, Ecopetrol, through its affiliate Ecopetrol Oleo E
Gas do Brasil LTD, in partnership with Anadarko Exploracao e Producao de
Petroleo e Gas Natural Ltd, entered into agreements to explore the BMC-29
block in
Ecopetrol continued its expansion activities in the U.S.
As of
During the first half of 2009, the Company acquired in 1,250 equivalent
kilometers of seismic in
Production
In line with its goals of increasing crude oil and natural gas production, Ecopetrol achieved a monthly average gross production of 504.2 thousand BOE/D in June, a 9.1% increase compared to average production in March of 2009.
For the second quarter of 2009, the three-month average gross production of oil and equivalent gas increased 9.7% from 445.4 thousand BOE/D (80.7% of crude oil and 19.3% of natural gas) in the second quarter of 2008 to 488.5 thousand BOE/D (80.9% of crude oil and 19.1% of natural gas) in the second quarter 2009.
This growth was marked by a higher gross production of heavy crude oils in the Llanos Orientales region, and in the mature fields of the Magdalena Medio zone.
For the first half of the year, gross production increased 7.1%, from 441.5 thousand BOE/D in 2008 (356.7 thousand BPD of crude oil and 84.8 BOE/D of natural gas) to 472.9 thousand BOE/D (385.3 thousand BPD of crude oil and 87.7 thousand BOE/D of natural gas) in the same period in 2009.
In terms of its acquisition strategy, on
Hocol contributed average gross production of 23.91 thousand BOE/D in June, while Offshore International Group contributed a 6.24 thousand BOE/D production for the first half of 2009. These production amounts are not included in Ecopetrol's above-mentioned gross production.
Production results were supported by the drilling management of development wells. The Company took part in the drilling of 142 development wells during the second quarter of 2009, compared to 139 development wells in the second quarter of 2008.
Ecopetrol drilled 34 development wells during the second quarter of 2009 on its own, while the other 108 were drilled by its partners, compared to 34 wells drilled on its own and 105 through arrangements with its partners in the second quarter of 2008.
Lifting costs were
Refining
Subsequent to the acquisition of the remaining 51.0% of Refineria de
The hydrotreatment project in Barrancabermeja, which will enable improved fuel quality, is now 82% complete.
In the second quarter of 2009, 213.7 thousand BD of crude oil were loaded
in the Barrancabermeja refinery, compared to 233.2 thousand BD refined in the
second quarter of 2008. The lower load was due to scheduled maintenance works
in
The gross margin of refined products for the Barrancabermeja refinery was
The refining cash cost for the Barrancabermeja refinery was
Transportation
The expansion of infrastructure systems is required in order to transport higher production of heavy crude oil from the Llanos Orientales [field]. The new Apiay-Porvenir pipeline began operating at full capacity in the second quarter of 2009, with a total capacity of 160 thousand BCD, which will allow transportation of heavy crude oils from the Meta province to the Vasconia station, from where it can be transferred for export.
The transportation cost for the first half of 2009 was
Investments
Capitalized total investments for the second quarter of 2009, including
acquisitions, were
In the first half of 2009, capitalized total investments were
Of total investments in the first half of 2009, including acquisitions, 25.9% was allocated to upstream activities (mainly mature and heavy crude oil fields), 12.3% to downstream activities, and the remaining 61.8% to acquisitions, mainly the acquisitions of Offshore International Group, Ocensa S.A., and Refineria de Cartagena S.A.
Corporate Social Responsibility
Negotiation of the Collective Bargaining Agreement
Upon the filing of claims by the coexisting unions in Ecopetrol S.A. -
namely, USO, ADECO, and SINDISPETROL - and under the terms of the respective
Guarantee Acts, direct negotiation talks with these unions began on
This process, whose aim is to establish the conditions governing labor contracts while in force, is of the utmost importance to Ecopetrol S.A. and its workers because the agreements reached will strengthen the relationship of trust with unions and contribute to the achievement of the Company's corporate goals.
Environment
Ecopetrol takes a leading role in several Colombian efforts to preserve
the environment. In the first half of 2009, these efforts included the
agreement among Ecopetrol, the Municipality of Barrancabermeja and Fundacion
Ecopetrol for the Development of Magdalena Medio (Fundesmag) to invest
Additionally, and jointly with the Ministry of Environment, Housing and
Land Development, Ecopetrol launched the Biodiversity National Call, which is
focused on promoting know-how and conservation projects, biodiversity
management and use of the High Andean wetlands, Orinoquia and Magdalena Medio,
as well as of the ecosystems present in certain districts within the Company's
area of influence. The Company made a
Presentation of results
On
In Spanish In English
8:00 a.m. Bogota 10:00 a.m. Bogota
(9:00 a.m. New York) (11:00 a.m. New York)
The webcast will be available at Ecopetrol's web page: www.ecopetrol.com.co., and in the following links:
http://phx.corporate-ir.net/playerlink.zhtml?c=218606&s=wm&e=2317454 (English) http://phx.corporate-ir.net/playerlink.zhtml?c=218606&s=wm&e=2330943 (Spanish)
Please access the website 10 minutes earlier in order to download the required software. A copy of the webcast will be available for one year after the live event.
About Ecopetrol S.A.
Ecopetrol S.A. (BVC: ECOPETROL; NYSE: EC) is the largest Colombian company
as measured by revenues, profit, assets, and stockholder's equity. Ecopetrol
is also
For further information on Ecopetrol, visit its website at www.ecopetrol.com.co.
Forward-looking statements
This release contains forward-looking statements related to business prospects, operating and financial results estimates, and Ecopetrol's growth prospects. These are mere projections, and, as such, are solely based on top management expectations regarding the future of the Company and its ongoing access to capital to finance the Company's business plan. Such forward-looking statements depend, basically, on variations in market conditions, government regulations, pressure from competition, the performance of the Colombian economy and the industrial sector, among other factors; therefore they are subject to change without prior notice.
ECOPETROL:
Investor Relations Director
Alejandro Giraldo
Phone: +571-234-5190
Fax: +571-234-5628
E-mail: investors@ecopetrol.com.co
Media Relations (Colombia)
Jorge Mauricio Tellez
Phone: + 571-234-4329
Fax: +571-234-4480
ECOPETROL S.A.
Unaudited Profit and Loss Statement
In millions of Colombian Pesos
2Q-09 2Q-08 % 1Q-09
Revenues
Domestic Sales 3438557 5838609 -41% 3153804
Foreign Sales 3015286 3360343 -10% 1723061
Service Sales 231666 225800 3% 235888
Total Revenues 6685509 9424752 -29% 5112753
Cost of Sales
Variable Costs:
Purchases from ANH and
Third Parties 1716256 2337881 -27% 1399973
Amortization and Depletion 429339 263542 63% 394519
Imported Products 424803 843107 -50% 544050
Inventory Changes -191597 53659 -457% 240005
Others 295549 -24730 1295% 7006
Fixed Costs:
Depreciation 162104 157171 3% 151630
Contracted Services
Association and Ecopetrol 301072 302317 0% 374210
Maintenance 235232 206853 14% 64946
Labor Costs 176530 157079 12% 190129
Hydrocarbon Transportation
Services 201207 162068 24% 159581
Others 250064 246886 1% 150122
Total Cost of Sales 4000559 4705833 -15% 3676171
Gross Profit 2684950 4718919 -43% 1436582
Operating Expenses
Administrative 123044 71198 73% 94028
Selling Expenses 185763 183650 1% 223722
Exploration and Project
Expenses 243862 79318 207% 97922
Operating Profit 2132281 4384753 -51% 1020910
Non-operating Income (expenses):
Financial Income 1430584 2115656 -32% 3147425
Financial Expenses -2147555 -1371097 -57% -1822388
Non-Financial Income 117871 381385 -69% 202683
Non-Financial Expenses -431197 -731785 41% -334152
Profit before Income Tax 1101984 4778912 -77% 2214478
Provision for Income Tax 339975 1422260 -76% 605217
Minority Interest
Net Income for the Quarter 762009 3356652 -77% 1609261
EBITDA 2807640 4823221 -42% 1629228
EBITDA MARGIN 42% 51% 32%
EARNINGS PER SHARE 18.83 82.94 39.76
Unaudited Profit and Loss Statement
ECOPETROL S.A.
As of June 30, As of June 30,
2009 2008 %
In million Colombian Pesos
Revenues
Domestic Sales 6592361 10385540 -37%
Foreign Sales 4738347 5821592 -19%
Services Sales 467554 440054 6%
Total Revenues 11798262 16647186 -29%
Cost of Sales
Variable Costs:
Purchases from ANH and Third Parties 3116229 4251549 -27%
Amortization and Depletion 823858 518271 59%
Imported Products 968853 1269744 -24%
Inventory Changes 48408 -357410 114%
Others 302555 8107 3632%
Fixed Costs:
Depreciation 313734 325754 -4%
Contracted Services Association and
Ecopetrol 675282 587966 15%
Maintenance 300178 260906 15%
Labor Costs 366659 308515 19%
Hydrocarbon Transportation Services 360788 273913 32%
Others 400186 401901 0%
Total Cost of Sales 7676730 7849216 -2%
Gross Profit 4121532 8797970 -53%
Operating Expenses
Administrative 217072 144439 50%
Selling Expenses 409485 363272 0%
Exploration and Projects Expenses 341784 139754 145%
Operating Profit 3153191 8150505 -61%
Non-operating Income (expenses):
Financial Income 4578009 3630971 26%
Financial Expenses -3969943 -3163514 25%
Non-Financial Income 320554 509446 -37%
Non-Financial Expenses -765349 -1219785 -37%
Profit before Income Tax 3316462 7907623 -58%
Provision for Income Tax 945192 2257626 -58%
Minority Interest
Net Income for the Quarter 2371270 5649997 -58%
EBITDA 4436868 9024438 -51%
EBITDA MARGIN 38% 54%
EARNINGS PER SHARE 58.59 139.6
Unaudited Profit and Loss Statement*
Ecopetrol S.A. and Subsidiaries*
In millions of Colombian Pesos 2Q-09 2Q-08 %
Revenues
Domestic Sales 3500327 6031706 -42%
Foreign Sales 3544496 3484447 2%
Services Sales 231666 225800 3%
Total Revenues 7276489 9741953 -25%
Cost of Sales
Variable Costs:
Purchases to the ANH
and Third Parties 1716256 2337881 -27%
Amortization and
Depletion 499277 263542 89%
Imported Products 424803 843107 -50%
Inventory Changes -191597 53659 -457%
Other 293749 257448 14%
Fixed Costs:
Depreciation 339643 157171 116%
Contracted Services
Association and
Ecopetrol 301072 302317 0%
Maintenance 235232 206853 14%
Labor Costs 176530 157079 12%
Hydrocarbons
Transportation
Services 201207 162068 24%
Other 688589 246886 179%
Total Cost of Sales 4684761 4988011 -6%
Gross Profit 2591728 4753942 -45%
Operating Expenses
Administrative 186084 75468 147%
Selling Expenses 44570 195710 -77%
Exploration and
Project Expenses 260131 79318 228%
Operating Profit 2100943 4403446 -52%
Non-Operating Income (Expenses):
Financial Income 6981821 2120726 229%
Financial Expenses -7757423 -1378823 -463%
Non-financial Income 149617 418686 -64%
Non-financial Expenses -441267 -766332 42%
Profit before Income Tax 1033691 4797703 -78%
Provision for Income Tax 348656 1426159 -76%
Minority Interest 7241
Net Income for the Quarter 692276 3371544 -79%
EBITDA 3134115 4841914 -35%
EBITDA MARGIN 43% 50%
Notes
* According to the Public Accounting Framework, Colombian companies only have the obligation to consolidate their financial statements at the end of each fiscal year, wherefore the figures in this report do not constitute a formal consolidation of Ecopetrol's financial statement, though they do adjust to the methodology defined for this purpose. These values are included for illustrative purposes only.
For the estimated consolidation of Ecopetrol's financial statements for second quarter and first half 2009, in addition to Ecopetrol S.A. results, the following companies were included: In the Upstream Area: Ecopetrol Oleo e Gas Do Brasil, Ecopetrol America Inc, Ecopetrol del Peru S.A., and Hocol.
In the Downstream area: Bioenergy S.A., Andean Chemicals Limited, ECP
Global Energy, Propilco S.A., Comai, ODL Finance S.A., Ecopetrol
Transportation Company, Oleoducto de
For the second quarter and the first half of 2008, the following companies were included: Ecopetrol S.A. Black Gold Re Ltd, Ecopetrol Oleo e Gas Do Brasil, Ecopetrol America Inc, Ecopetrol del Peru S.A., Andean Chemicals Ltd, Propilco, and Comai.
Unaudited Profit and Loss Statement*
Ecopetrol S.A. and Subsidiaries*
As of June As of June
Millions of Colombian Pesos 30,2009 30, 2008 %
Revenues
Domestic Sales 6687482 10578637 -37%
Foreign Sales 5361572 5950040 -10%
Services Sales 467554 440054 6%
Total Revenues 12516608 16968731 -26%
Cost of Sales
Variable Costs:
Purchases to the ANH
and Third Parties 3116229 4251549 -27%
Amortization and
Depletion 893796 518271 72%
Imported Products 968853 1269744 -24%
Inventory Changes 48408 -357410 114%
Other 302555 8107 3632%
Fixed Costs:
Depreciation 562223 343129 64%
Contracted Services
Association and
Ecopetrol 675282 587966 15%
Maintenance 300178 260906 15%
Labor Costs 366659 308515 0%
Hydrocarbons
Transportation Services 360788 273913 0%
Other 847731 667338 27%
Total Cost of Sales 8442702 8132028 4%
Gross Profit 4073906 8836703 -54%
Operating Expenses
Administrative 286512 148750 93%
Selling Expenses 281827 375332 0%
Exploration and Projects
Expenses 342073 139754 145%
Operating profit 3163494 8172867 -61%
Non-operating Income (Expenses):
Financial Income 10182748 3632372 180%
Financial Expenses -9632256 -3171240 204%
Non-financial Income 352627 546747 -36%
Non-financial Expenses -797783 -1254332 -36%
Profit before Income Tax 3268830 7926414 -59%
Provision for Income Tax 975311 2261525 -57%
Minority Interest -7191 0 0%
Net income for the Quarter 2300710 5664889 -59%
EBITDA 4889666 9046800 -46%
EBITDA MARGIN 39% 53%
Notes
* According to the Public Accounting Framework, Colombian companies only have the obligation to consolidate their financial statements at the end of each fiscal year, wherefore the figures in this report do not constitute a formal consolidation of Ecopetrol's financial statement, though they do adjust to the methodology defined for this purpose. These values are included for illustrative purposes only.
For the estimated consolidation of Ecopetrol's financial statements for second quarter and first half 2009, in addition to Ecopetrol S.A. results, the following companies were included: In the Upstream Area: Ecopetrol Oleo e Gas Do Brasil, Ecopetrol America Inc, Ecopetrol del Peru S.A., and Hocol.
In the Downstream area: Bioenergy S.A., Andean Chemicals Limited, ECP
Global Energy, Propilco S.A., Comai, ODL Finance S.A., Ecopetrol
Transportation Company, Oleoducto de
For the second quarter and the first half of 2008, the following companies were included: Ecopetrol S.A. Black Gold Re Ltd, Ecopetrol Oleo e Gas Do Brasil, Ecopetrol America Inc, Ecopetrol del Peru S.A., Andean Chemicals Ltd, Propilco, and Comai.
Unaudited General Balance Sheet
Ecopetrol S.A.
As of June As of March**
Millions of Colombian Pesos 30, 2009 31,2009 %
Assets
Current Assets:
Cash and Cash Equivalents 3896740 4905199 -21%
Investments 1140016 4056917 -72%
Accounts and Notes Receivable 5443632 5823977 -7%
Other 3573116 3710937 -4%
Total Current Assets 14053504 18497030 -24%
Non Current Assets
Investments 8417755 9803942 -14%
Accounts Receivable 1375948 204772 572%
Property, Plant and Equipment, Net 9102311 8205783 11%
Natural and Environmental
Resources, Net 7019129 6908475 2%
Resources Delivered under Management 0 0
Others 10140914 9731838 4%
Total Non-current Assets 36056057 34854810 3%
Total Assets 50109561 53351840 -6%
Liabilities and Shareholders' Equity
Current Liabilities:
Financial Liabilities 21328 0
Accounts Payable and Related Parties 10199989 12969595 -21%
Estimated Liabilities and Provisions 643986 661771 -3%
Others 1863240 4384631 -58%
Total current liabilities 12728543 18015997 -29%
Long-term liabilities
Long Term Labor Liabilities 2316441 2247638 3%
Estimated Liabilities and Provisions 2729043 2832880 -4%
Others 4158574 2523543 65%
Total Long-Term Liabilities 9204058 7604061 21%
Total Liabilities 21932601 25620058 -14%
Minority Interest
Shareholders' Equity 28176960 27731782 2%
Total Liabilities and Shareholders'
Equity 50109561 53351840 -6%
Memorandum Accounts 135399679 168298711
** After the presentation of First Quarter 2009 Earnings Report, and following a recommendation from its auditors, Ecopetrol S.A. made the decision to reclassify contributions to pension fund and abandon fund to non current assets from current assets, as those funds correspond to long-term funds
Unaudited General Balance Sheet
Ecopetrol S.A. and Subsidiaries*
As of June As of March**
30, 2009 31, 2009 %
Millions of Colombian Pesos
Assets
Current Assets:
Cash and Cash Equivalents 5301604 5340424 -1%
Investments 1585977 4308734 -63%
Accounts and Notes Receivable 5945625 6345547 -6%
Others 4268444 4044325 6%
Total Current Assets 17101650 20039030 -15%
Non-current Assets
Investments 2025875 5333076 -62%
Accounts and Notes Receivable 215407 161609 33%
Property, Plant & Equipment,
Net 13742146 10760563 28%
Natural and Environmental
Resources, Net 8924336 8425236 6%
Resources Delivered under
Management 0 0
Others 10302129 9814356 5%
Total Non-current Assets 35209893 34494840 2%
Total Assets 52311543 54533870 -4%
Liabilities and Shareholders' Equity
Current Liabilities:
Financial Liabilities 187184 170080 10%
Accounts Payable and Related
Parties 3118050 12859069 -76%
Estimated Liabilities and
Provisions 824027 717446 15%
Others 7942303 4464972 78%
Total Current Liabilities 12071564 18211567 -34%
Long Term Liabilities
Long Term Labor Liabilities 2352369 2247638 5%
Estimated Liabilities and
Provisions 2820608 2867197 -2%
Others 6003109 2558403 135%
Total Long Term Liabilities 11176086 7673238 46%
Total Liabilities 23247650 25884805 -10%
Minority Interest 0 918109 4%
Shareholders' Equity 28106398 27730956 1%
Total Liabilities and
Shareholders' Equity 52311543 54533870 -4%
Memorandum Accounts*** 136651843 168549091
Notes
* According to the Public Accounting Framework, Colombian companies only have the obligation to consolidate their financial statements at the end of each fiscal year, wherefore the figures in this report do not constitute a formal consolidation of Ecopetrol's financial statement, though they do adjust to the methodology defined for this purpose. These values are included for illustrative purposes only.
For the estimated consolidation of Ecopetrol's financial statements for second quarter and first half 2009, in addition to Ecopetrol S.A. results, the following companies were included: In the Upstream Area: Ecopetrol Oleo e Gas Do Brasil, Ecopetrol America Inc, Ecopetrol del Peru S.A., and Hocol.
In the Downstream area: Bioenergy S.A., Andean Chemicals Limited, ECP
Global Energy, Propilco S.A., Comai, ODL Finance S.A., Ecopetrol
Transportation Company, Oleoducto de
For the second quarter and the first half of 2008, the following companies were included: Ecopetrol S.A. Black Gold Re Ltd, Ecopetrol Oleo e Gas Do Brasil, Ecopetrol America Inc, Ecopetrol del Peru S.A., Andean Chemicals Ltd, Propilco, and Comai.
** After the presentation of First Quarter 2009 Earnings Report, and following a recommendation from its auditors, Ecopetrol S.A. made the decision to reclassify contributions to pension fund and abandon fund to non current assets from current assets, as those funds correspond to long-term funds
***Under Colombian GAAP, Ecopetrol must maintain in its accounting the recording of financial information and transactions not reflected in financial statements
Unaudited Cash Flow Statement
Ecopetrol S.A.
Millions of Colombian Pesos 2Q-09 2Q-08 % 1Q-09
BEGINNING BALANCE 4905199 5114615 -4% 1870246
OPERATING ACTIVITIES
Cash from Clients 6566615 7231803 -9% 4931556
Cash from Financial Interest 288492 365995 -21% 208144
Income from Reimbursements
from FAEP and Other 0 0 0 0
Other Payments 0 0 0 0
Cash from Acquired Affiliates 0 0 0 0
Financial Interest Payments 0 -184 100% 0
Cash Paid to Suppliers and
Contractors -5955380 -1362334 -337% -473100
Payments for Hydrocarbon Purchases -402532 -2610110 85% -798838
Payment of Income, Sales and Equity,
Taxes -2486032 -1242830 -100% -571795
Payment of Salaries, Social Benefits
and Social Security -331020 -225534 -47% -227797
Payment of Retirement Pensions and
Transfer to Funds 0 -94924 100% 0
Net Cash from Operating Activities -2319857 2061882 -213% 3068170
INVESTMENT ACTIVITIES
Net Decrease (Increase) in investments 4290176 -1573130 373% 1238306
Investments in Property, Plant
Equipment and Natural Resources -1716984 -1440599 -19% -1281444
Net Cash Used in Investment Activities 2573192 -3013729 185% -43138
FINANCING ACTIVITIES
Dividends Payment -3026185 -1163585 -160% 0
Received from Partners -
Capitalization -4522 176359 -103% 9921
Increase (Decrease)of Financial
Obligations 1768913 0
Cash Generated by (Used in)
Financing Activities -1261794 -987226 -28% 9921
CASH VARIATION -1008459 -1939073 48% 3034953
END BALANCE 3896740 3175542 23% 4905199
ECOPETROL S.A.
Unaudited Cash Flow Statement
As of June 30, As of June 30,
In million Colombian Pesos 2009 2008 %
BEGINNING BALANCE 1870246 3466184 -46%
OPERATING ACTIVITIES
Cash from Clients 11498171 13448057 -14%
Cash from Financial Interest 496636 691493 -28%
Income from Reimbursements
from FAEP and Other 0 0 0%
Cash from Acquired Affiliates 0 0 0%
Other Payments 0 0 0%
Financial Interest Payments 0 -339 100%
Cash Paid to Suppliers and Contractors -6428481 -2963495 -117%
Payment for Hydrocarbon Purchases -1201370 -3175850 62%
Payment of Income, Sales, and Equity
Taxes -3057827 -1965420 -56%
Payment of Salaries, Social Benefits,
and Social Security -558817 -397713 -41%
Payment of Retirement Pensions and
Transfer to Funds 0 -244572 100%
Net Cash from Operating Activities 748312 5392161 -86%
INVESTMENT ACTIVITIES
Net Decrease (Increase) in Investments 5528483 -3268203 269%
Investments in Property, Plant and
Equipment, and Natural Resources -2998428 -1743767 -72%
Net Cash Used in Investment Activities 2530055 -5011970 150%
FINANCING ACTIVITIES
Distribution of Profit -3026185 -1163585 -160%
Received from Partners - Capitalization 5399 496321 -99%
Increase (Decrease) in Financial
Liabilities 1768913 -3569 49663%
Cash Generated by (Used in)
Financing Activities -1251873 -670833 -87%
CASH VARIATION 2026494 -290642 797%
END BALANCE 3896740 3175542 23%
Unaudited Cash Flow Statement
Ecopetrol S.A. and Subsidiaries *
Millions of Colombian Pesos 2Q-09 2Q-08 %
BEGINNING BALANCE 5340425 5386758
OPERATING ACTIVITIES
Cash from Clients 9657739 7229960 34%
Cash from Financial Interest 290919 365855 -20%
Income from Reimbursements from FAEP
and Other 0 0
Other Payments 0 0
Cash from Acquired Affiliates 191736 0 100%
Financial Interest Payment 0 -184 100%
Cash Paid to Suppliers and Contractors -8191103 -1432439 -472%
Payment for Hydrocarbon Purchases -314361 -2610110 88%
Payment of Income, Sales and Equity
Taxes -2510134 -1242830 -102%
Payment of Salaries, Social Benefits
and Social Security -342477 -225496 -52%
Payment of Retirement Pensions and
Transfer to Funds 0 -94924 100%
Net Cash from Operating Activities -1217681 1989832 -161%
INVESTMENT ACTIVITIES
Net Decrease (Increase) in Investments 5262934 -1546038 440%
Investment in Property, Plant,
Equipment and Natural Resources -3279747 -1425727 -130%
Net Cash Used in Investment
Activities 1983187 -2971765 -167%
FINANCING ACTIVITIES
Dividends Payment -3042626 -1163585 -161%
Received from Partners - Capitalization -4522 176359 -103%
Increase (Decrease) of Financial
Obligations 2242821 0
Cash Generated by (Used in)
Financing Activities -804327 -987226 19%
CASH VARIATION -38821 -1969159 98%
END BALANCE 5301604 3417599 55%
Notes
* According to the Public Accounting Framework, Colombian companies only have the obligation to consolidate their financial statements at the end of each fiscal year, wherefore the figures in this report do not constitute a formal consolidation of Ecopetrol's financial statement, though they do adjust to the methodology defined for this purpose. These values are included for illustrative purposes only.
For the estimated consolidation of Ecopetrol's financial statements for second quarter and first half 2009, in addition to Ecopetrol S.A. results, the following companies were included: In the Upstream Area: Ecopetrol Oleo e Gas Do Brasil, Ecopetrol America Inc, Ecopetrol del Peru S.A., and Hocol.
In the Downstream area: Bioenergy S.A., Andean Chemicals Limited, ECP
Global Energy, Propilco S.A., Comai, ODL Finance S.A., Ecopetrol
Transportation Company, Oleoducto de
For the second quarter and the first half of 2008, the following companies were included: Ecopetrol S.A. Black Gold Re Ltd, Ecopetrol Oleo e Gas Do Brasil, Ecopetrol America Inc, Ecopetrol del Peru S.A., Andean Chemicals Ltd, Propilco, and Comai.
Unaudited Cash Flow Statement
ECOPETROL S.A. and Subsidiaries*
As of June 30, As of June 30,
In millions of Colombian Pesos 2009 2008 %
BEGINNING BALANCE 2113803 3749899
OPERATING ACTIVITIES
Cash from Clients 14605590 13467414 8%
Cash from Financial Interest 499824 691493 -28%
Income from Reimbursements
from FAEP and Other 0 0 0%
Cash from Acquired Affiliates 486369 0 100%
Other Payments 0 0
Financial Interest Payments 0 -339 100%
Cash Paid to Suppliers and Contractors -8589569 -3094659 -178%
Payments for Hydrocarbon Purchases -1201361 -3175850 62%
Payment of Income, Sales, and Equity
Taxes -3081929 -1965420 -57%
Payment of Salaries, Social Benefits, and
Social Security -571592 -397713 -44%
Payment of Retirement Pensions and
Transfer to Funds 0 -244572 100%
Net Cash from Operating Activities 2147332 5280354 -59%
INVESTMENT ACTIVITIES
Net Decrease (Increase) of Investments 6510174 -3167484 306%
Investments in Property, Plant and
Equipment, and Natural Resources -4612557 -1774337 -160%
Net Cash Used in Investment Activities 1897617 -4941821 138%
FINANCING ACTIVITIES
Distribution of Profit -3042626 -1163585 -161%
Received from Partners - Capitalization 5399 496321 -99%
Increase (Decrease) of Financial
Liabilities 2180079 -3569 61184%
Cash Generated by (Used in)
Financing Activities -857148 -670833 -28%
CASH VARIATION 3187801 -332300 1059%
END BALANCE 5301604 3417599 55%
Notes
* According to the Public Accounting Framework, Colombian companies only have the obligation to consolidate their financial statements at the end of each fiscal year, wherefore the figures in this report do not constitute a formal consolidation of Ecopetrol's financial statement, though they do adjust to the methodology defined for this purpose. These values are included for illustrative purposes only.
For the estimated consolidation of Ecopetrol's financial statements for second quarter and first half 2009, in addition to Ecopetrol S.A. results, the following companies were included: In the Upstream Area: Ecopetrol Oleo e Gas Do Brasil, Ecopetrol America Inc, Ecopetrol del Peru S.A., and Hocol.
In the Downstream area: Bioenergy S.A., Andean Chemicals Limited, ECP
Global Energy, Propilco S.A., Comai, ODL Finance S.A., Ecopetrol
Transportation Company, Oleoducto de
For the second quarter and the first half of 2008, the following companies were included: Ecopetrol S.A. Black Gold Re Ltd, Ecopetrol Oleo e Gas Do Brasil, Ecopetrol America Inc, Ecopetrol del Peru S.A., Andean Chemicals Ltd, Propilco, and Comai.
PROFIT AND LOSS U.S. GAAP
ECOPETROL S.A.
Consolidated Statements of income (*) USGAAP
(In million Colombian pesos)
JUNE 2009
(Unaudited)
Revenue:
Local sales 7,399,310
Foreign sales 5,361,572
Total revenue 12,760,882
Cost of sales 8,052,483
Gross Profit 4,708,399
Operating expenses:
Administration 1,363,980
Selling 613,444
Operating
income 2,730,975
Non-operating, net 1,748,067
Income before income tax and
minority interest 4,479,042
Income tax: 727,063
Income before minority
interest 3,751,979
Minority interest 7,191
Net Income 3,759,170
Earnings per share 92.88
(*) During the second quarter of 2009, Ecopetrol made acquisitions of new companies, the financial statements don't include these effects, the company is including estimates for pension plans, impairments of fixed assets, ARO, under USGAAP, and for those reasons the statements don't reflect a full USGAAP reconciliation.
ECOPETROL S.A.
Consolidated Balance Sheet (*) USGAAP
(In million Colombian pesos)
Assets
Current assets:
Cash and cash equivalents 6,014,825
Investments 884,950
Accounts and notes
receivable, net 5,649,429
Inventories 1,921,970
Deferred income taxes 278,664
Other 2,306,301
Total current assets 17,056,139
Non current assets
Investments 3,041,718
Accounts and notes
receivable, net 215,406
Property, plant
and equipment, net 12,730,898
Natural and environmental
resources, net 7,325,825
Advances and deposits 231,269
Deferred income taxes 2,064,144
Other 3,884,362
Total Non current assets 29,493,622
Total Assets $46,549,761
Liabilities and shareholders'
equity
Current liabilities:
Financial obligations 187,185
Accounts payable and
related parties 8,885,853
Estimated liabilities
and provisions 637,673
Other 2,323,077
Total current liabilities 12,033,788
Long term Liabilities
Financial obligations, long-term 3,485,791
Pension plan obligation and
other labor obligations,
long-term 2,374,977
Deferred income tax, long-term 1,255,972
Estimated liabilities and provisions 2,095,955
Other 1,393,341
Total Long term liabilities 10,606,036
Total liabilities 22,639,824
Minority interest 957,495
Shareholders' equity 22,952,442
Total liabilities and
shareholders' equity 46,549,761
(*) During the second quarter of 2009, Ecopetrol made acquisitions of new companies, the financial statements don't include these effects, the company is including estimates for pension plans, impairments of fixed assets, ARO, under USGAAP, and for those reasons the statements don't reflect a full USGAAP reconciliation.
SOURCE Ecopetrol S.A.