Tupras posted TL1,392mn net income in 4Q21, better than the consensus estimate of TL496mn.
Tupras recorded TL6,891mn EBITDA (Consensus Est.: TL6,171mn) in 4Q21 thanks to TL5,223mn inventory gain related to recovery in brent oil prices and TL depreciation, better product cracks and higher capacity utilization rate in 4Q21.
Based on Bloomberg consensus estimates, Tupras trades at 3.83x 2022E EV/EBITDA multiple, implying %41 discounts compared to its 5-yr historic multiple. TUPRS remains in our tactical buy call list, considering the ongoing recovery in product cracks.
Tupras consolidated revenues increased by 182% y/y to TL56.5bn in 4Q21 thanks to higher demand, product prices and TL depreciation. The company’s CUR increased to 98.5% in 4Q21 from 81.8% in 4Q20 (3Q21: 96.5%). The company’s production volume increased by 15.7% y/y to 7.0mn tons in 4Q21 while total sales volume increased by 22.2% y/y to 7.7mn tons and reached highest 4Q figure since 4Q15. Tupras’ domestic sales volume increased by 17% y/y to 6.0mn tons while export sales volume increased by 43% y/y to 1.7mn tons in 4Q21.
Higher refining margin… Med-complex net refining margin increased to US$3.6/bbl in 4Q21 from US$2.80/bbl in 3Q21. The company recorded TL5,223mn inventory gain in 4Q21 (3Q21: TL511mn). Tupras’ net refining margins increased to US$9.1/bbl (+US$3.7/bbl inventory effect) in 4Q21 from US$5.9/bbl (US$0.5/bbl inventory effect) in 3Q21 thanks to the better crack margin supported by the improving trend of demand and lower stock levels of oil products. EBITDA per ton was at US$80/ton in 4Q21 vs. US$36/ton 3Q21 (4Q20: US$5/ton)
The company announced its 2022E guidance. The company expects 28-29mn tons of sales volume, implying 1-5% increase and the company expects 26-27mn tons of production, implying 4-8% increase in 2022E. Tupras expects 90-95% CUR during 2022E, compared to 88% in 2021. Tupras guides its net refining margin to be between US$4-5 in 2022E, compared to US$5.7/bbl in 2021. The company expect Med complex margin to be between US$2-3 in 2022, compared to US$1.6/bbl in 2021. The company guides US$300mn consolidated capex for 2022E, compared to US$152mn in 2021.