AB Klaipėdos nafta preliminary revenue for the May 2020

AB Klaipėdos nafta, (further the Company) reviewed operating segments since the beginning of the second quarter of 2020 and presents revenue disclosures accordingly. The following operating segments of the Company are:

• Oil terminals activity, that includes Klaipėda oil terminal and Subačius oil terminal,
• Regulated LNG activity in Klaipėda and
• Commercial LNG activity, that includes small-scale LNG reloading station in Klaipėda and Business development projects.

The preliminary sales revenue of the Company’s oil terminals for the May 2020 comprised EUR 3.1 million and is higher by EUR 0.8 million or by 34.8 per cent compared to May of 2019.  The preliminary sales revenue is higher due to increase of sales of oil products storage, if compared to the same period of 2019. The preliminary sales revenue of the Company’s oil terminals for the first five months of 2020 comprised EUR 13.7 million, i.e. higher by 6.2 per cent, compared to the same period of 2019.

The preliminary sales revenue of the Company LNG terminal for May 2020 comprised EUR 3.7 million (during the same month of 2019 – EUR 5.8 million). LNG terminal revenue consists of the regasification tariff fixed part (for booked annual capacities), variable part for amount of regasified LNG and reloading revenue from regulated activities. The level of Klaipėda LNG terminal revenue (for booked annual capacities) does not depend on regasification volume. Revenue is confirmed by the National Energy Regulatory Council (NERC) based on the approved methodology of State regulated prices in the natural gas sector and is calculated for the whole upcoming year. The preliminary sales revenue of LNG terminal for the first five months of 2020 decreased by 37.7 per cent due to the reduction of security supplement of Klaipėda LNG terminal by 42 per cent from the 1^st January of 2020.

The preliminary sales revenue of the Company’s Commercial LNG activity for the May 2020 comprised EUR 0.2 million.  If compared to the respective period last year, the preliminary sales revenue is higher due to Business development projects consultation revenue and increase of small-scale LNG station revenue. The preliminary sales revenue of the Company’s Commercial LNG activity for the first five months of 2020 comprised EUR 1.2 million.

Total preliminary sales revenue of the Company for the January-May 2020 amount to EUR 32.2 million and is lower by 24.4 per cent compared to the same period of 2019 - EUR 42.6 million.

Preliminary revenue of the Company, EUR million:

	May			January - May
	2020	2019	Change	2020	2019	Change
Oil terminals activity	3.1	2.3	34.8%	13.7	12.9	6.2%
LNG terminal activity	3.7	5.8	-36.2%	18,5	29.7	-37.7%
Commercial LNG activity	0.2	0.0	100.0%	1.2	0.1	11 times
Total	7.0	8.1	-13.6%	32.2	42.6	-24.4%

Comment by the Company management:

In international markets in May there still was a lot of uncertainty, which was influenced both by COVID-19 impact on the economies, as well as continuous trend of historically low oil prices. Market context influences results of KN – as our clients seek to preserve their profitability, the demand for the oil products storage has increased. It significantly influenced the result of sales revenue of KN oil terminals.

The main factor, which influenced the total Company‘s revenue result in January-May, 2020, was lower revenue of Klaipėda LNG terminal, following from the KN decisions, adopted in 2019, to optimize Klaipėda LNG terminal costs and reduce the cost of LNG terminal infrastructure for consumers, starting from 2020 annually.

Jonas Lenkšas, Chief Financial Officer, +370 694 80594.

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