Puma Energy today announced its financial results for the three-month period ended 31 March 2023.
Puma Energy maintained the positive performance achieved in the previous year as it continued to turn around and strengthen the business by focusing on core downstream activities. The company has taken a prudent approach to actively manage the current economic uncertainty and market volatility. Despite these conditions, Puma Energy was able to maintain healthy margins, offsetting a slight decrease in volumes sold in the previous quarter and increasing net profit to USD 20 million in Q1 2023, excluding IFRS 16. Importantly, the company’s profitability continued to improve as a result of the restructuring and optimisation efforts in 2022.
During the quarter, EBITDA was USD 106 million, compared to USD 95 million in Q4 2022. In addition, positive cash flow was maintained, driven by EBITDA performance, despite the negative change in working capital to USD -32 million. The aviation, refining and lubricants segments showed an improvement in gross profit relative to both Q4 2022 and Q1 2022 on a constant perimeter.
“This quarter Puma Energy has maintained the positive performance delivered throughout 2022, despite fragile economic circumstances and uncertain macroeconomic outlook. In 2022 our priority was to restructure the business to focus on core downstream activities and in this quarter, we continued to see improvements in the company’s performance,” said Carlos Pons, Chief Financial Officer of Puma Energy.
“In May, we closed our 2023 Revolving Credit Facility and Term Loan. These facilities raised over USD 800 million, the highest amount for five years, demonstrating the confidence that the wide range of participating banks have in the turnaround and future potential of Puma Energy. The facilities’ ESG linked KPIs relating to greenhouse gas emissions reduction as well as security and human rights reinforced the company’s active commitment to sustainability,” added Pons.
Health and safety
Maintaining and enhancing safety standards remains a top priority. The Lost Time Injury Frequency Rate for employees and contractors working on Puma Energy sites in the quarter was 0.381. This represents a decline in performance. As a result, the company has continued to focus its efforts in improving safety culture and will build on the 40,000 hours of health and safety training delivered in 2022.
Investment in Core Retail
Puma Energy continued its efforts to revamp its retail sites with the aim to improve customer experience and loyalty. In addition, the company continues to grow and optimise its network, delivering a net increase of 10 retail sites this quarter.
In line with Puma Energy’s strategy to focus on its core downstream markets, phase two of the divestment of the company’s major marine terminals continued in Q1 2023. Facilities in Ghana and Puerto Rico have been removed from the perimeter of the transaction but closure of the El Salvador terminal remains on track to conclude in Q2 2023. The remaining assets in Tanzania are expected to be delayed.
Transition Fuels and Clean Energy
In 2023 Puma Energy aims to install a further 100 solar projects across its network, building on the 200 installed by the end of 2022. By the end of the quarter, the company had installed solar power projects at 215 sites with a total operational capacity of 6,754 kWp.
After a significant reduction in the Company’s gross and net debt in 2022, gross debt was stable this quarter. Based on a standard definition of net debt, excluding inventories and net of cash, net debt stood at USD 690 million or 1.6 x LTM EBITDA2. Driven by this improvement in net leverage, in April 2023 Fitch revised Puma Energy’s outlook to positive from stable and affirmed Puma Energy International Financing S.A.’s senior unsecured instruments at BB-.
Net Profit and Working Capital
Puma Energy’s net profit was USD 20 million, excluding IFRS 16, compared to USD 15 million in Q4 2022. EBITDA was USD 106 million in Q1 2023 compared to USD 95 million in Q4 2022. The reduction in working capital to USD -32 million resulted from active pre-payment of vendors to improve terms and conditions.
Sustainability Linked RCF and Term Loan
Puma Energy’s 2023 Revolving Credit Facility and Term Loan was launched in March and closed in May with facilities representing commitments of USD 822.5 million. This is the highest amount raised for five years. The Sustainability Linked facilities will see margins adjusted subject to Puma Energy achieving independently verified KPIs relating to greenhouse gas emissions reduction as well as security and human rights.