4 – Segment Reporting
Changes in segment reporting
Starting with Q1/21 the OMV Group structure was reorganized, which involved splitting and expanding former operating Business Segment Downstream into two areas: Refining & Marketing and Chemicals & Materials. Internal reporting and the relevant information provided to the chief operating decision-maker in order to assess performance and allocate resources has been updated to reflect the current organization structure.
Business operations and key markets
For business management purposes, OMV is divided into three operating Business Segments: Exploration & Production, Refining & Marketing, and Chemicals & Materials, as well as the segment Corporate and Other (Co&O). Each segment represents a strategic unit with different products and markets. Each Business Segment is managed independently. Strategic business decisions are made by the Executive Board of OMV. With the exception of Co&O, the reportable segments of OMV are the same as the operating segments.
Exploration & Production (E&P) engages in the business of oil and gas exploration, development and production and focuses on the regions Central and Eastern Europe, North Sea, Middle East and Africa and Asia-Pacific.
The Refining & Marketing (R&M) Business Segment refines and markets crude and other feedstock. It operates the refineries Schwechat (Austria), Burghausen (Germany) and Petrobrazi (Romania) with an annual capacity of 17.8 mn t. In these refineries, crude oil is processed into petroleum products, which are sold to commercial and private customers. Furthermore, it operates across the gas value chain with a successful gas sales and logistics business in Europe. OMV markets storage capacities in Austria and Germany. The business segments’ activities also cover supply, marketing, and trading of gas in Europe and Turkey and the Group’s power business activities, with one gas-fired power plant in Romania.
OMV has a strong position in the markets located within the areas of its supply, serving commercial customers, and operating a retail business of approximately 2,100 filling stations.
OMV holds minority stakes in various equity-accounted investments, the most significant one is the 15% participation in ADNOC Refining (United Arab Emirates) with annual capacity of 7.1 mn t OMV share.
The Chemicals & Materials (C&M) Business Segment is one of the world’s leading providers of advanced and circular polyolefin solutions and a European market leader in base chemicals, fertilizers, and plastics recycling.
Since the full consolidation of Borealis in 2020, OMV has a production capacity, including joint ventures, of 7.0 mn t base chemicals, 5.8 mn t polyolefins, 0.4 mn t compounding and 4.3 mn t fertilizers. The majority of production is located in Europe, with two overseas manufacturing facilities in the United States, one in Brazil and one in South Korea. In addition, OMV holds minority stakes in various equity-accounted investments, the most significant ones being Borouge (United Arab Emirates) a Borealis’ joint venture with ADNOC that operates the largest petrochemical complex in the world and the Baystar joint venture (United States) which serves the customer base in the North American markets. A new plant based on Borstar technology on the site in Pasadena is currently under construction.
OMV group is pursuing various initiatives in mechanical and chemical recycling and renewable polyolefins.
Group management, financing and insurance activities and certain service functions are concentrated in the Corporate & Other (Co&O) segment.
One of the key measures of operating performance for the Group is Clean CCS Operating Result. Total assets include intangible assets as well as property, plant and equipment. Sales to external customers are split up by geographical areas on the basis of where the risk is transferred to the customers. The net revenues of commodity trading activities within the scope of IFRS 9 and hedging results are reported in the country in which the reporting subsidiary is located. Accounting policies of the operating segments are the same as those described in the summary of significant accounting policies, with certain exceptions for intra-group sales and cost allocations by the parent company, which are determined in accordance with internal OMV policies. Management is of the opinion that the transfer prices of goods and services exchanged between segments correspond to market prices. Business transactions not attributable to operating segments are included in the results of the Co&O segment.
The disclosure of special items is considered appropriate in order to facilitate analysis of ordinary business performance. To reflect comparable figures, certain items affecting the result are added back or deducted. These items can be divided into four subcategories: personnel restructuring, unscheduled depreciation and write-ups, asset disposals and other. Furthermore, to enable effective performance management in an environment of volatile prices and comparability with peers, the Current Cost of Supply (CCS) effect is eliminated from the result. The CCS effect, also called inventory holding gains and losses, is the difference between the cost of sales calculated using the current cost of supply based on purchases from the most recent month and the cost of sales calculated using the weighted average method, after adjusting for any changes in valuation allowances. In volatile energy markets, measurement of the costs of petroleum products sold based on historical values (e.g. weighted average cost) can have distorting effects on reported results. This performance measurement indicator enhances the transparency of results and is commonly used in the oil industry. OMV, therefore, publishes this measure in addition to the Operating Result determined according to IFRS.
In EUR mn |
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2021 |
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E&P |
R&M |
C&M |
Co&O |
Total |
Consolidation |
OMV Group |
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Sales revenues1 |
6,712 |
25,928 |
11,618 |
376 |
44,634 |
(9,079) |
35,555 |
||||||||
Intersegmental sales |
(4,828) |
(2,780) |
(1,109) |
(361) |
(9,079) |
9,079 |
— |
||||||||
Sales to third parties |
1,884 |
23,148 |
10,509 |
14 |
35,555 |
— |
35,555 |
||||||||
Other operating income |
347 |
274 |
249 |
63 |
933 |
— |
933 |
||||||||
Net income from equity-accounted investments |
55 |
12 |
534 |
— |
600 |
— |
600 |
||||||||
Depreciation and amortization |
1,396 |
429 |
535 |
41 |
2,401 |
— |
2,401 |
||||||||
Impairment losses (incl. exploration & appraisal) |
325 |
718 |
495 |
0 |
1,538 |
— |
1,538 |
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Write-ups |
0 |
3 |
— |
— |
4 |
— |
4 |
||||||||
Operating Result |
2,439 |
922 |
1,828 |
(74) |
5,115 |
(51) |
5,065 |
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Special items for personnel restructuring |
14 |
7 |
— |
9 |
30 |
— |
30 |
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Special items for unscheduled depreciation and write-ups |
100 |
713 |
483 |
— |
1,297 |
— |
1,297 |
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Special items for asset disposal |
(209) |
(7) |
— |
(6) |
(223) |
— |
(223) |
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Other special items |
492 |
(204) |
(87) |
9 |
210 |
— |
210 |
||||||||
Special items |
398 |
509 |
396 |
12 |
1,315 |
— |
1,315 |
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CCS effect |
— |
(430) |
— |
— |
(430) |
12 |
(418) |
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Clean CCS Operating Result |
2,837 |
1,001 |
2,224 |
(62) |
5,999 |
(39) |
5,961 |
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Segment assets2 |
12,217 |
3,989 |
5,283 |
241 |
21,730 |
— |
21,730 |
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Additions in PPE/IA3 |
1,251 |
621 |
724 |
28 |
2,624 |
— |
2,624 |
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Equity-accounted investments4 |
429 |
1,325 |
5,133 |
— |
6,887 |
— |
6,887 |
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Segment reporting information of earlier periods has been adjusted consequently to comply with IFRS 8.29. The tables below depict the segment reporting information as restated after the reorganization and reported in 2020:
In EUR mn |
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2020 restated |
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E&P |
R&M |
C&M |
Co&O |
Total |
Consolidation |
OMV Group |
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Sales revenues1 |
3,705 |
13,996 |
2,884 |
352 |
20,937 |
(4,387) |
16,550 |
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Intersegmental sales |
(2,178) |
(1,345) |
(515) |
(348) |
(4,387) |
4,387 |
— |
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Sales to third parties |
1,527 |
12,651 |
2,368 |
4 |
16,550 |
— |
16,550 |
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Other operating income |
180 |
265 |
1,391 |
56 |
1,892 |
(15) |
1,877 |
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Net income from equity-accounted investments |
31 |
(202) |
210 |
— |
38 |
— |
38 |
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Depreciation and amortization |
1,335 |
444 |
147 |
39 |
1,965 |
— |
1,965 |
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Impairment losses (incl. exploration & appraisal) |
1,452 |
9 |
0 |
0 |
1,462 |
— |
1,462 |
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Write-ups |
120 |
111 |
— |
— |
230 |
— |
230 |
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Operating Result |
(1,137) |
592 |
1,568 |
(56) |
967 |
83 |
1,050 |
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Special items for personnel restructuring |
31 |
4 |
— |
5 |
39 |
— |
39 |
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Special items for unscheduled depreciation and write-ups |
1,185 |
(101) |
— |
— |
1,084 |
— |
1,084 |
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Special items for asset disposal |
(9) |
(9) |
— |
(1) |
(19) |
— |
(19) |
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Other special items |
75 |
84 |
(1,049) |
5 |
(885) |
— |
(885) |
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Special items |
1,282 |
(22) |
(1,049) |
9 |
220 |
— |
220 |
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CCS effect |
— |
425 |
— |
— |
425 |
(10) |
416 |
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Clean CCS Operating Result |
145 |
996 |
519 |
(47) |
1,612 |
74 |
1,686 |
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Segment assets2 |
12,662 |
3,955 |
5,767 |
262 |
22,646 |
— |
22,646 |
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Additions in PPE/IA3 |
1,150 |
509 |
251 |
28 |
1,938 |
— |
1,938 |
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Equity-accounted investments4 |
389 |
1,912 |
6,020 |
— |
8,321 |
— |
8,321 |
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In EUR mn |
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2020 reported |
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U/S |
D/S |
Co&O |
Total |
Consolidation |
OMV Group |
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Sales revenues1 |
3,705 |
15,082 |
352 |
19,139 |
(2,589) |
16,550 |
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Intrasegmental sales |
(2,178) |
(63) |
(348) |
(2,589) |
2,589 |
— |
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Sales to third parties |
1,527 |
15,019 |
4 |
16,550 |
— |
16,550 |
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Other operating income |
180 |
1,656 |
56 |
1,892 |
(15) |
1,877 |
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Net income from equity-accounted investments |
31 |
7 |
— |
38 |
— |
38 |
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Depreciation and amortization |
1,335 |
591 |
39 |
1,965 |
— |
1,965 |
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Impairment losses (incl. exploration & appraisal) |
1,452 |
10 |
0 |
1,462 |
— |
1,462 |
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Write-ups |
120 |
111 |
— |
230 |
— |
230 |
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Operating Result |
(1,137) |
2,160 |
(56) |
967 |
83 |
1,050 |
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Special items for personnel restructuring |
31 |
4 |
5 |
39 |
— |
39 |
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Special items for unscheduled depreciation and write-ups |
1,185 |
(101) |
— |
1,084 |
— |
1,084 |
||||||||
Special items for asset disposal |
(9) |
(9) |
(1) |
(19) |
— |
(19) |
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Other special items |
75 |
(965) |
5 |
(885) |
— |
(885) |
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Special items |
1,282 |
(1,071) |
9 |
220 |
— |
220 |
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CCS effect |
— |
425 |
— |
425 |
(10) |
416 |
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Clean CCS Operating Result |
145 |
1,514 |
(47) |
1,612 |
74 |
1,686 |
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Segment assets2 |
12,662 |
9,721 |
262 |
22,646 |
— |
22,646 |
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Additions in PPE/IA3 |
1,150 |
760 |
28 |
1,938 |
— |
1,938 |
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Equity-accounted investments4 |
389 |
7,932 |
— |
8,321 |
— |
8,321 |
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In 2021 special items for unscheduled depreciation and write-ups were mainly driven by non-cash impairment charges related to ADNOC Refining, E&P assets and the nitrogen business of Borealis. For further details on impairments see Note 7 – Depreciation, amortization, impairments and write-ups.
Special items for asset disposals were mainly stemming from a gain from the sale of the stake in the Norwegian oil field Wisting.
Other special items mainly consisted of non-cash valuation effects of financial assets, especially related to the reassessment of reserves redetermination rights of the Yuzhno Russkoye field in Russia, and temporary hedging effects in Exploration & Production. In Refining & Marketing and Chemicals & Materials other special items were mainly related to temporary hedging effects.
In 2020 other special items in Exploration & Production mainly consisted of the reassessment of reserves redetermination rights related to the field Yuzhno Russkoye and temporary hedging effects. Refining & Marketing mainly included temporary hedging effects. Chemicals & Materials other special items were mainly related to revaluation effects for previously held 36% shares in Borealis AG triggered by the acquisition of 39% additional shares.
In EUR mn |
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2021 |
2020 |
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Sales to third parties |
Allocated assets1 |
Equity-accounted investments2 |
External sales |
Allocated assets1 |
Equity-accounted investments2 |
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Austria |
5,326 |
4,207 |
14 |
3,466 |
4,388 |
78 |
||||||||
Germany |
8,499 |
1,061 |
31 |
3,268 |
1,105 |
33 |
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Romania |
4,433 |
5,628 |
— |
3,456 |
6,106 |
— |
||||||||
Norway |
1,003 |
1,508 |
— |
584 |
1,675 |
— |
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Russia |
642 |
592 |
117 |
448 |
619 |
102 |
||||||||
New Zealand |
443 |
550 |
— |
402 |
607 |
— |
||||||||
United Arab Emirates |
784 |
1,671 |
5,352 |
325 |
1,479 |
6,874 |
||||||||
Rest of CEE3 |
5,246 |
556 |
— |
2,878 |
639 |
6 |
||||||||
Rest of Europe |
6,823 |
3,140 |
45 |
1,126 |
3,187 |
21 |
||||||||
Rest of the world4 |
2,356 |
2,289 |
1,328 |
598 |
2,343 |
1,207 |
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Subtotal |
35,555 |
21,201 |
6,887 |
16,550 |
22,148 |
8,321 |
||||||||
Not allocated assets |
— |
529 |
— |
— |
498 |
— |
||||||||
Total |
35,555 |
21,730 |
6,887 |
16,550 |
22,646 |
8,321 |
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Not allocated assets contained goodwill in amount of EUR 322 mn (2020: EUR 297 mn) related to the cash-generating unit ‘Middle East and Africa’, EUR 198 mn (2020: EUR 183 mn) related to the cash generating unit
‘SapuraOMV’ and EUR 9 mn (2020: EUR 18 mn) related to the cash-generating unit ‘Refining West’ as these CGUs are operating in more than one geographical area.