Repsol Holds Annual General Meeting (Spain)

Repsol’s Executive Chairman, Antonio Brufau, today informed the company’s shareholders attending the Annual General Meeting of progress on the 2012-2016 Strategic Plan, which has transformed Repsol into one of the energy companies with best growth prospects thanks to its intense and successful exploration and production activity.

Brufau pledged to continue with the commitment to create jobs and nurture talent, which over the last five years has led to the creation of 3,500 new jobs and 1,600 training grants.

Brufau announced that the Board of Directors’ Meeting held prior to the Annual General Meeting approved the offer to repurchase preference shares at 97.5% of its par value. Those accepting the offer will, for every preference share (1,000 euros of par value), receive a 10-year bond with a par value of 500 euros with a coupon of 3.5%, and 475 euros in cash. The offer is more attractive than conditions currently available in the market.

The Annual General Meeting approved the results for the past financial year, during which the company posted a net profit of 2.06 billion euros. At current cost of supply,

Repsol’s net result increased by 5.4% compared with the previous year to 2.048 billion euros. The results are particularly significant in that the 2011’s earnings had included the stake in YPF.

Repsol’s Executive Chairman began his presentation to shareholders by going over the fulfilment of the 2012-2016 Strategic Plan, with significant and encouraging progress during the first year of operation of the plan, as five of the 10 key projects have already started, the competitiveness of the refining system has been improved thanks to expansions of the Cartagena and Petronor refineries, while the financial objectives set for the plan as a whole have been surpassed.

The success of Repsol’s exploration operations allowed hydrocarbon output to increase in 2012 by 11% above the goals set out in the strategic plan, while also achieving a record reserve replacement rate of 204%, amongst the highest in the industry.

During the year, the company made one of the largest discoveries worldwide, Pão de Açucar in Brazil, along with other very significant finds in Peru, Colombia and Algeria. Following these exploratory results, Brufau announced, a new growth phase from 2016 thanks to activity in new areas with considerable potential and the start of production at the recent discoveries.

In the Downstream unit, the expansion projects at the Cartagena and Petronor refineries have given Repsol one of the most competitive refining systems in Europe. The improved competitiveness of these assets has helped place refining margins at the forefront of the European industry.

Antonio Brufau also commented on the company’s financial solidity, which with the sale of LNG assets will cut debt by 2.2 billion euros with liquidity three times greater than its short-term debt maturities. In this regard the past financial year was marked by major financial milestones: Repsol sold its treasury stock to qualified investors and the market for 2.4 billion euros; it undertook divestments in Chile and Ecuador and agreed the sale of LNG assets; it issued seven-year bonds for 1.2 billion euros (the lowest coupon since Spain joined the Euro); and today announced the repurchase of the preference shares.

Particularly relevant was the inclusion within the company’s shareholding of Singapore’s Temsaek, which acquired 6.3% of Repsol’s stock. The Annual General Meeting appointed Rene Dahan as the shareholder representing Temasek, and he took up his position on the Board of Directors upon conclusion of the general meeting.

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LNG World News Staff, May 31, 2013; Image: Repsol