MOL Group reports USD $152m net loss in Q1, as Covid-19 pandemic hits

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Today, MOL Group announced its financial results for Q1 2020. Large inventory and foreign exchange losses resulted in MOL reporting a USD 152mn net loss for Q1, the first sign of the pandemic-related crisis. Underlying operations were running strong until mid-March, as reflected by the USD 622mn Clean CCS EBITDA, however, the pandemic had already started to severely affect all business lines in the last two to three weeks of March and the situation further deteriorated in April. Due to the unpredictable external environment, 2020 EBITDA guidance was withdrawn, and organic capital expenditure guidance was cut by more than 25%.

In MOL Group’s consumer services division, which operates almost 2,000 service stations in 10 countries in Central and Eastern Europe. EBITDA grew by 4% in local currency terms (flat in USD-terms at USD 88mn) in Q1, but the lockdown and the severe trading conditions in the last two to three weeks of March wiped out much of the strong growth experienced earlier in Q1 both in fuel and non-fuel margins. 

Fuel volumes were down in April by around 35-40% across the network, but sales have started to slowly improve recently. Non-fuel sales and margin initially declined, but grocery sales improved in the last few weeks and assortment was widened. Recent non-fuel performance is only 10-20% below last year’s level.

Chairman-CEO Zsolt Hernádi commented on the results: “Covid-19 shapes and rules the world and the energy industry. The pandemic situation and economic crisis that follows will cast a long shadow on our overall performance in 2020. Individuals as well as companies entered a period of uncertainty we have probably never even imagined before. While we are fighting the pandemic and doing our best to protect our people, our customers and partners, we are also working hard to make sure MOL can continue to operate even under extreme scenarios and can eventually emerge even stronger from this crisis. Our dedicated people, high quality assets, strong balance sheet and our resilient, integrated business model shall help us navigating through these unchartered waters. We have already made a series of difficult decisions that will help us to achieve cash neutrality, to maintain our liquidity and financial flexibility and to grab opportunities which may arise on the way towards normalization.”