HELLENiQ Energy - Another strong set of results

HELLENiQ Energy reported Q322 adjusted EBITDA of €504m, c four times higher than Q321 (€125m) and c 25% ahead of consensus (c €404m; seven analysts). This was mostly driven by a strong performance in Refining, Supply & Trading, due to strong benchmark refining margins and exports (46% of total refining sales). In addition, HELLENiQ reported improved profitability of international subsidiaries, as well as a significantly greater contribution from RES (Renewable Energy Sources). Furthermore, improved refineries’ performance and crude oil supply opportunities, as well as the operational improvement initiatives, such as the digital transformation programme, the group reorganisation, premium products in retail and network development, also had a significant contribution. Adjusted net income was €381m, more than 11 times Q321 (€33m), and c 50% ahead of consensus. It announced an interim dividend of €0.25/share, which combined with a special dividend (from the sale of DEPA) of €0.40/share equates to a dividend yield of 9.5%, before taking account of any final dividend for FY22. Our forecasts and valuation are under review.