Topics filter

Results

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 (). 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 () 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 OMV share.

The Chemicals & Materials () 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 . 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 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 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 () 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.

Segment reporting

In EUR mn

 

 

 

 

 

 

 

 

2021

 

E&P

R&M

C&M

Co&O

Total

Consoli­dation

OMV Group

 

 

 

 

 

 

 

 

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

Write-ups

0

3

4

4

Operating Result

2,439

922

1,828

(74)

5,115

(51)

5,065

Special items for personnel restructuring

14

7

9

30

30

Special items for unscheduled depreciation and write-ups

100

713

483

1,297

1,297

Special items for asset disposal

(209)

(7)

(6)

(223)

(223)

Other special items

492

(204)

(87)

9

210

210

Special items

398

509

396

12

1,315

1,315

CCS effect

(430)

(430)

12

(418)

Clean CCS Operating Result

2,837

1,001

2,224

(62)

5,999

(39)

5,961

Segment assets2

12,217

3,989

5,283

241

21,730

21,730

Additions in PPE/IA3

1,251

621

724

28

2,624

2,624

Equity-accounted investments4

429

1,325

5,133

6,887

6,887

1

Including intra-group sales

2

Property, plant and equipment (PPE), intangible assets (IA), not including assets reclassified to assets held for sale

3

Excluding additions in assets reclassified to held for sale and additions to decommissioning assets

4

Excluding assets held for sale

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:

Segment reporting

In EUR mn

 

 

 

 

 

 

 

 

2020 restated

 

E&P

R&M

C&M

Co&O

Total

Consoli­dation

OMV Group

 

 

 

 

 

 

 

 

Sales revenues1

3,705

13,996

2,884

352

20,937

(4,387)

16,550

Intersegmental sales

(2,178)

(1,345)

(515)

(348)

(4,387)

4,387

Sales to third parties

1,527

12,651

2,368

4

16,550

16,550

Other operating income

180

265

1,391

56

1,892

(15)

1,877

Net income from equity-accounted investments

31

(202)

210

38

38

Depreciation and amortization

1,335

444

147

39

1,965

1,965

Impairment losses (incl. exploration & appraisal)

1,452

9

0

0

1,462

1,462

Write-ups

120

111

230

230

Operating Result

(1,137)

592

1,568

(56)

967

83

1,050

Special items for personnel restructuring

31

4

5

39

39

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)

Other special items

75

84

(1,049)

5

(885)

(885)

Special items

1,282

(22)

(1,049)

9

220

220

CCS effect

425

425

(10)

416

Clean CCS Operating Result

145

996

519

(47)

1,612

74

1,686

Segment assets2

12,662

3,955

5,767

262

22,646

22,646

Additions in PPE/IA3

1,150

509

251

28

1,938

1,938

Equity-accounted investments4

389

1,912

6,020

8,321

8,321

1

Including intra-group sales

2

Property, plant and equipment (PPE), intangible assets (IA), not including assets reclassified to assets held for sale

3

Excluding additions in assets reclassified to held for sale and additions to decommissioning assets

4

Not including assets held for sale

Segment reporting

In EUR mn

 

 

 

 

 

 

 

2020 reported

 

U/S

D/S

Co&O

Total

Consoli­dation

OMV Group

 

 

 

 

 

 

 

Sales revenues1

3,705

15,082

352

19,139

(2,589)

16,550

Intrasegmental sales

(2,178)

(63)

(348)

(2,589)

2,589

Sales to third parties

1,527

15,019

4

16,550

16,550

Other operating income

180

1,656

56

1,892

(15)

1,877

Net income from equity-accounted investments

31

7

38

38

Depreciation and amortization

1,335

591

39

1,965

1,965

Impairment losses (incl. exploration & appraisal)

1,452

10

0

1,462

1,462

Write-ups

120

111

230

230

Operating Result

(1,137)

2,160

(56)

967

83

1,050

Special items for personnel restructuring

31

4

5

39

39

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)

Other special items

75

(965)

5

(885)

(885)

Special items

1,282

(1,071)

9

220

220

CCS effect

425

425

(10)

416

Clean CCS Operating Result

145

1,514

(47)

1,612

74

1,686

Segment assets2

12,662

9,721

262

22,646

22,646

Additions in PPE/IA3

1,150

760

28

1,938

1,938

Equity-accounted investments4

389

7,932

8,321

8,321

1

Including intra-group sales

2

Property, plant and equipment (PPE), intangible assets (IA), not including assets reclassified to assets held for sale

3

Excluding additions in assets reclassified to held for sale and additions to decommissioning assets

4

Not including assets held for sale

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 were mainly related to revaluation effects for previously held 36% shares in Borealis AG triggered by the acquisition of 39% additional shares.

Information on geographical areas

In EUR mn

 

 

 

 

 

 

 

2021

2020

 

Sales to third parties

Allocated assets1

Equity-accounted investments2

External sales

Allocated assets1

Equity-accounted investments2

Austria

5,326

4,207

14

3,466

4,388

78

Germany

8,499

1,061

31

3,268

1,105

33

Romania

4,433

5,628

3,456

6,106

Norway

1,003

1,508

584

1,675

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

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

1

Property, plant and equipment (PPE), intangible assets (IA), not including assets reclassified to assets held for sale

2

Equity-accounted investments are allocated based on the seat of the registered office of the parent company, not including assets held for sale

3

Including Turkey

4

Rest of world: Principally Algeria, Argentinia, Brazil, Chile, China, Colombia, Egypt, India, Libya, Malaysia, Marocco, Mexico, Nigeria, Peru, South Africa, South Korea, Singapore, Tunisia, United States of America and Yemen

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.

Co&O
Corporate and Other
R&M
Refining & Marketing business segment
t
Metric ton
C&M
Chemicals & Materials business segment
Clean CCS Operating Result
Operating Result adjusted for special items and CCS effects. The Group clean CCS Operating Result is calculated by adding the clean CCS Operating Result of Refining & Marketing, the clean Operating Result of other segments and the reported consolidation effect adjusted for changes in valuation allowances, in case the net realizable value of the inventory is lower than its cost.
IFRSs
International Financial Reporting Standards
Special items
Special items are expenses and income reflected in the financial statements that are disclosed separately, as they are not part of underlying ordinary business operations. They are being disclosed separately in order to enable investors to better understand and evaluate OMV Group’s reported financial performance.
CCS/CCS effects/inventory holding gains/(losses)
Current Cost of Supply; inventory holding gains and losses represent the difference between the cost of sales calculated using the current cost of supply and the cost of sales calculated using the weighted average method after adjusting for any changes in valuation allowances in case the net realizable value of the inventory is lower than its cost. 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 (Operating Result, net income, etc.). The amount disclosed as CCS effect represents the difference between the charge to the income statement for inventory on a weighted average basis (adjusted for the change in valuation allowances related to net realizable value) and the charge based on the current cost of supply. The current cost of supply is calculated monthly using data from supply and production systems at the Refining & Marketing level.
Special items
Special items are expenses and income reflected in the financial statements that are disclosed separately, as they are not part of underlying ordinary business operations. They are being disclosed separately in order to enable investors to better understand and evaluate OMV Group’s reported financial performance.