OMV AG

OMV reported first-quarter 2026 clean CCS operating result of more than EUR 1 billion, down 12% year on year, and clean CCS EPS of EUR 1. Cash flow from operating activities was almost EUR 800 million, while cash flow from operations excluding net working capital was more than EUR 1.6 billion. Net working capital increased by around EUR 850 million. Reported net income was more than EUR 1.6 billion versus EUR 288 million a year earlier, mainly due to an EUR 886 million gain from Borealis deconsolidation. Segment results included Energy clean CCS operating result of EUR 723 million, Fuels EUR 113 million, and Chemicals EUR 245 million. The OMV refining indicator margin averaged $13.9/bbl; realized crude was $72/bbl; realized gas was EUR 31/MWh; hydrocarbon production was 288,000 boe/d, down 7% year on year; and unit production costs were $11.6/bbl. For 2026, OMV now expects Brent at $85-$95/bbl, THE gas at about EUR 45/MWh, realized gas at EUR 35-EUR 40/MWh, oil and gas production at 280,000-290,000 boe/d, unit production cost around $11/bbl, refining indicator margin at $10-$15/bbl, ethylene indicator margin above EUR 550/tonne, propylene indicator margin above EUR 420/tonne, and the clean tax rate slightly below 50%.

Alfred Stern emphasized that OMV operated in an extraordinary and highly volatile energy environment caused by the Strait of Hormuz closure and broader Middle East conflict. He framed the quarter as proof of the integrated model’s resilience, highlighting solid operating results, stronger Chemicals performance, and continued downstream supply capability. He also spent much of his remarks on Borouge International, calling it a strategic and transformational step under Strategy 2030 that should create a fourth-largest global polyolefin player with stronger earnings quality and cash flow.

Reinhard Florey focused on cash flow, balance sheet, and the transaction’s accounting effects. He said operating cash flow excluding working capital was EUR 1.6 billion, organic investing cash flow was around EUR 900 million, and organic free cash flow before dividends was minus EUR 125 million; leverage rose from 14% to 17% after the Borouge deal but remains well below the 30% threshold, with EUR 3.5 billion of cash and EUR 3.1 billion of undrawn committed facilities at quarter-end. He also quantified timing effects in Q1 cash flow: around EUR 250 million from inventory/CCS timing and roughly EUR 100 million-EUR 150 million from gas derivatives, while noting Borouge International dividends are expected to be only 50% of the anticipated minimum dividend in 2026, with the other 50% expected in the second half.

Analysts focused on refining volatility, crude differentials, storage and hedging, Borouge International reporting and dividend implications, jet fuel availability, U.S. chemicals margins, Borouge 4 ramp-up, and whether the Middle East conflict could alter production or capital returns. Management said OMV’s refining exposure to Strait of Hormuz crudes was limited, that April refining margins were about $16/bbl, and that downstream hedging produced about EUR 100 million of losses in March when one leg disappeared because the physical crude was not available. On Borouge, OMV said Q1 production was mostly maintained through alternative logistics, more than 60% of March production was exported via alternative channels, the first Borouge 4 XLPE line is already online, and the project remains on track for full start-up before year-end; management also said the new structure should provide cleaner financials and a positive NOVA contribution going forward.