* Q2 clean CCS EBIT 733 mln eur vs Reuters poll avg 743 mln
* Refining and Marketing EBIT 160 mln eur vs poll avg 124
* Shares up 1 pct
(Adds details on business segments, cash flow, shares, analyst
By Georgina Prodhan
VIENNA, Aug 13 Surprisingly strong refining and
marketing results helped take the sting out of a
steeper-than-expected drop in second-quarter underlying profit
at Austrian oil and gas group OMV on Tuesday.
OMV said its results were hurt by lower sales volumes and
crude prices, a weak dollar and write-offs, mainly in the
exploration and production areas on which it is focusing.
OMV, which like its peers has been hit by declining demand
in Europe, said underlying operating profit (clean CCS EBIT)
fell 15 percent to 733 million euros ($974 million) and
underlying net income fell 29 percent to 321 million euros.
Average forecasts in a Reuters poll were 743 million euros
and 336 million euros respectively.
OMV said lower sales volumes in Libya, Britain and New
Zealand hurt its profits, as had exploration expenses that rose
72 percent to 98 million euros mainly due to write-offs in
Tunisia and Britain and increased seismic activities in Norway.
Its upstream exploration and production business, which it
is expanding, reported disappointing results, as did its gas and
power segment, but its downstream refining and marketing
operations reported a 24 percent rise in underlying profit.
OMV said marketing - which includes the filling stations it
is selling off - had made a strong contribution thanks to better
cost positions and higher margins in retail.
Cash flow from operating activities more than doubled to 1.2
billion euros, thanks to an efficiency programme that reduced
working capital and disposals of assets including hundreds of
Shares in OMV rose 1 percent to 34.87 euros in early
trading, and were the biggest gainers in a flat European oil and
"Despite weaker-than-expected results of the E&P and G&P
segments, we believe the market will appreciate the improvements
achieved in the downstream segment, as well as the strong cash
generation in 2Q," wrote analyst Oleg Galbur of RCB.
The company said it expected refining margins to remain at
lower levels this year due to subdued demand and persisting
overcapacity, and retail volumes would remain under pressure due
to the weak economic environment in its core markets.
OMV reported last month its second-quarter refining margin
fell 18 percent to $2.48 per barrel on weaker spreads, and
production slipped due to issues in Austria, Kazakhstan and
On Tuesday, OMV said production levels had largely returned
to normal in Libya after interruptions during the first half of
the year. The north African country accounted for about 10
percent of OMV's total production before the 2011 civil war.
OMV is switching focus from refining and selling oil and gas
to exploration and production, as Europe's refining industry
battles declining domestic demand - which has forced a painful
consolidation - and growing competition from Russia.
($1 = 0.7523 euros)
(Reporting by Georgina Prodhan; Editing by Michael Shields and