OMV Petrom S.A. (SNP) Earnings Call Transcript & Summary

Good afternoon, ladies and gentlemen, and welcome to the OMV Petrom's earnings call. Today's presentation will last around 30 minutes and will be recorded. By now, you should have received the presentation by e-mail. The slides and the speech are also available online on www.omvpetrom.com in the Investors section. These also include the cautionary statement regarding forward-looking statements. Now let me hand over to Simona Crutu, Manager of the Investor Relations and stakeholder engagement department who will moderate the events.

Good afternoon, ladies and gentlemen, and thank you for joining us. We will have a presentation followed by a Q&A session. Christina Verchere, Chief Executive Officer will provide the key highlights about the macroeconomic and regulatory environment, as well as the third quarter operational performance. Alina Popa, Chief Financial Officer, will give you more details on our financial performance and a brief outlook. Afterwards, they will be available to answer your questions. [Operator Instructions] I'm now handing over to Christina.

Good afternoon, ladies and gentlemen, and a warm welcome to our conference call that will take you through our performance in the third quarter of 2024. Please let me draw your attention to our legal disclaimer, which you can read in detail on Slide 2. Let me start by taking a look at the evolution of commodity prices in the third quarter 2024. Brent price had a downward trend starting the quarter at around $87 per barrel and closing around $73 per barrel. The evolution was impacted by concerns related to the conflict in the Middle East and the bearish sentiment from revised demand expectations. Brent quotation averaged $80 per barrel for the third quarter, a 7% decrease year-on-year. OMV Petrom indicator refining margin reached $7.10 per barrel in the third quarter, 58% lower year-on-year, mainly due to weaker gasoline and middle distillate spreads. European spot gas prices increased during the quarter despite high gas storage levels driven by a combination of factors, including concerns about Russian pipeline supplies across Ukraine and reduced supply due to Norwegian maintenance. At an average of EUR 37 per megawatt hour, the CEGH price was up by 8% year-on-year, 15% quarter-on-quarter. Gas prices on the Romanian centralized market also increased with day-ahead prices at around EUR 31 per megawatt hour, 17% higher quarter-to-quarter, and flat year-on-year. Base load electricity prices in Romania increased both year-on-year and quarter-on-quarter to an average of EUR 127 per megawatt hour. The average CO2 price was 20% down year-on-year to EUR 67 per tonne of CO2, reflecting sluggish industrial demand and was broadly flat quarter-on-quarter. Looking now at Romanian macroeconomic environment. The latest available data shows that in the second quarter of 2024, GDP increased by 0.8% year-on-year. In October, the IMF reduced its projected GDP growth for 2024 from 2.8% to 1.9%. As of 2025, remaining GDP is now forecast to grow by 3.3%, reduced from the previous 3.6%. Though the expectations of softening, Romania remains well above the estimate for the EU average of 1.1% in 2024 and 1.6% in 2025. The consumer price index for the month of September 2024 versus September 2023 was of 4.6% on a downward trend compared to spikes in January and February of 2024. Looking at the Romanian energy sector in the third quarter of 2024, demand based on our internal estimates increased for all our products. The demand for retail fuel slightly increased by around 2% year-on-year. The effect of higher disposable income and holiday season's peak being partly offset by the July fuel excise increase. Commercial demand was up by 3% year-on-year, supported by intense road construction activity and higher jet demand. Gas demand increased by around 4% year-on-year, with higher offtake from industrial consumers as well as some gas to power. Power demand was 2% higher year-on-year, while domestic production significantly decreased by 7% year-on-year, Romania being a net importer of power in the third quarter. Power production from gas and solar sources had a significantly higher year-on-year contribution to the generation mix, while hydro, coal, wind and nuclear power decreased year-on-year. Turning to the regulatory framework for our market. The gas and power sector in Romania remains highly regulated with more than half of our gas and power sales portfolio subject to some form of regulation or taxation. Ordinance 32, the latest change that came into effect starting April, continued to negatively impact our results, especially on the power side. Our current estimate of this impact from financials for April to December this year, remains in the high double-digit million euro. Although we support the step towards liberalization, these must be in the context of a competitive and predictive physical framework. For the interim period until full liberalization was expected to take place in April of next year, the level of taxes on power producers remains very high. On Slide 6, we present the key highlights for the quarter when we had robust operational performance in the context of lower oil and gas prices, partly offset by integration benefit. At RON 1.6 billion, our third quarter clean CCS operating result was 36% lower year-on-year. Our operating cash flow in the third quarter of 2024 declined to the same extent and reached RON 1.9 billion. The clean CCS return on average capital employed was almost 21 percentage points. In expiration production, the result mainly reflects the lower oil and gas prices and higher hydrocarbon sales volumes. The result in refining and marketing reflects lower refining margins, partially compensated by strong performance in our sales channel and our excellent refinery utilization. In gas and power, the result reflects decreased prices and margins as well as the negative effect of regulatory changes. Our gas business result was impacted by reduced gas sales volume in the context of the very high storage obligation and less attractive sales opportunities, while our Power business result was affected by regulation in place. During the third quarter, we have further focused on delivering on all three strategic directions. In our strategic pillar, grow regional gas, our Neptun Deep project is progressing as planned. We advanced the construction of the platform topside in Indonesia and started construction works for the steel jacket in Italy as well as the natural gas metering station in [indiscernible] Romania. We remain on schedule for drilling the first well in 2025 and first gas in 2027. We are also making significant progress in our strategic [indiscernible] transition to low and zero carbon. In normal power, we closed the transaction with Jantzen Renewables the acquisition three photovoltaic projects totaling a capacity of approximately 710 megawatts, all in the ready-to-build stage. We also closed two transactions with Renovatio, one refers to projects with the capacity of approximately 1 gigawatt to be developed in partnership with Renovatio. The other refers to operational assets for the capacity of 18 megawatts that entered our portfolio. Thus, together with the announced partnership with CE Oltenia and our own photovoltaic project at Isalnita, we now have 2.8 gigawatts of capacity of projects in our portfolio. This puts us on track to achieve our target of 2.5 gigawatt of renewable power capacity, including partnerships, by 2030. On electric mobility, after closing acquisition of Renovatio network at the end of May, we are on track to reach around 1,000 fast and [indiscernible] charging by the end of this year, positioning OMV Petrom are the largest player in e-mobility in Romania. On HSSE, the Total Recordable Injury Rate for the rolling period October 2023 to September 2024 was 0.28. Moreover, we continued our efforts to reduce greenhouse gas intensity with projects in all three business segments. Based on our preliminary data, the GHG intensity in the first nine months of 2024 decreased year-on-year in all three divisions, reflecting our ongoing initiatives to reduce carbon emission. On Slide 7, I would like to present our operational performance, and I'll start with Exploration and Production. Hydrocarbon production in the third quarter decreased by 6% year-on-year, reflecting the planned maintenance activity which were delivered in line with expectations. The lower production was also due to financial decline in the main field, partly offset by good results from workover jobs in new wells. Production cost per barrel of oil equivalent increased year-on-year by 4% to $16.77, mainly due to lower volumes available for sale and higher personnel cost partly offset by low costs for energy, materials and services. In Refining and Marketing, we had an excellent refining utilization rate of 99%. Total refined product sales volumes increased by 2% year-on-year, with retail sales up 1% year-on-year. In Gas and Power, total gas sales volumes were 12% lower year-on-year in the context of the very high storage obligation and less attractive sales opportunity. The Brazi power plant generated terawatt-hour in the third quarter, covering a 12% share in Romania's generation mix. Moving now to Slide 8. Total CapEx for the first 9 months of 2024 was RON 4.8 billion, 41% higher year-on-year. More than 40% of this CapEx was spent for strategic projects, namely Neptun Deep and Renewables, underpinning our strategic execution and our planned transformation for a lower carbon future. In Exploration and Production, in addition to Neptun Deep project, which I covered earlier, we finalized the drilling of 26 new wells and side track and performed more than 400 workover jobs. In Refining and Marketing, around RON 0.9 billion of investments were mostly for major refinery projects such as the new aromatic complex, sulfur acid gas treatment plant and the new SAF/HVO unit, but also to retail for the acquisition of Renovatio's network of charging points and further expansion of our e-mobility business. And in Gas and Power, the RON 0.9 billion mainly reflects the closing of the renewables transaction. For the full year 2024, we've maintained our guidance provided in July of up to RON 6.5 billion of organic CapEx, almost 40% higher compared to last year. There will also be CapEx associated with the closing of our M&A transactions for [indiscernible] projects that would bring the total CapEx to around RON 7.5 billion. Please let me now hand over to Alina for more detail on the financial results of the third quarter of 2024.

Thank you, Christina, and good afternoon from my side. I will continue the presentation in Slide 10, starting with some highlights on the income statement and development of the third quarter of 2024. Sales decreased by 11% year-on-year, negatively impacted by the lower prices and sales volumes of natural gas and lower sales volume services. This was partially offset by the impact of higher prices in electricity. Clean operating results in Exploration and Production was 23% low year-on-year, driven by the lower oil and gas prices, lower sales volume, partly offset by lower E&P gas association and depreciation. Clean operating results in the Refining and Marketing dropped 20%, mainly due to lower refining margins, partly offset by improved performance of sales channels. Clean operating result in Gas and Power decreased considerably year-on-year, mainly due to lower results from the Brazi power plant in [indiscernible] change in legislation in April 2024 and the [indiscernible] power parting from the exceptional high levels of prior year quarter.

[indiscernible] Please continue to stand by. Your conference will resume shortly.

I will continue the presentation with a clean consolidation line, which was minus RON 69 million in the third quarter of 2024, mainly as a result of a significant gas [indiscernible]. Consequently, the group CCS operating result decreased by 36% year-on-year to RON 1.6 billion. For the fourth -- for the third quarter of 2024, we recorded inventory holding losses of RON 98 million compared with inventory holding gains of RON 94 million in the third quarter of 2023. We also recorded net special charges of RON 12 million. For comparison, in the third quarter of 2023, we recorded net special charges of minus RON 207 million, mainly driven by the net temporary effects from the forward contract for power and CO2. The Clean CCS net income attributable to stockholders decreased by 33% year-on-year to RON 1.4 billion. Let me go on to Slide 11, which shows the major building blocks for the development of the Clean CCS operating result. I will start with exploration and production. The market effect deviation of RON 32 million reflects lower oil and gas prices, partly compensated by lower E&P taxes. The latter is mainly due to the tax exempted quantities used in Bright power plant and the volumes put in storage for which our taxation is due when the gas is sold. The operational effect had a negative deviation year-on-year, mainly due to lower hydrocarbon sales volumes, partly compensated by lower depreciation. In downstream, the negative market effect in refining and marketing reflects the lower refining margin. Operational effects were positive year-on-year, reflecting excellent performance in refinery utilization, sales channels and nonfuel business. In Gas & Power, we recorded lower results in both gas and power business lines impacted by market developments and regulatory changes. In the gas business, higher storage costs, coupled with lower gas prices overall have lowered our margins. The power business continues to be affected by the changes in legislation introduced starting April. However, we achieved good results from the balancing and serially services market as well as from transactions outside Romania, yet significantly lower year-on-year. The 0.5% tax on revenue introduced starting January amounted to around RON 55 million, mostly booked in Refining and Marketing segment. On Slide 12, I would like to continue with the highlights regarding our cash flow statement. In the third quarter of 2024, the cash generated from operating activities before net working capital movements and solidarity contribution was 22% lower year-on-year at RON 2.4 billion. Working capital changes led to a cash outflow of RON 442 million in the third quarter of 2024, compared to RON 39 million in the third quarter of 2023. Main reasons for negative net working capital changes are driven by higher inventories, related gas and petroleum products, and increase in excise paid in advance. Consequently, the operating cash flow in the third quarter of 2024 amounted to RON 1.9 billion compared to RON 3 billion in the previous year. Our net payment for investing activities amounted to RON 1.8 billion, higher by 10% year-on-year. This mainly reflects a cash outflow for organic CapEx amounting to RON 1.4 billion, and a cash outflow for inorganic investments and loans amounting to RON 0.6 billion, while investments in government bonds had a net positive impact of RON 0.1 billion. The net cash position, including leases, decreased to RON 10.2 billion at the end of September 2024 versus RON 14.5 billion at the end of the third quarter of 2023. The special dividend in amount of RON 1.9 billion were paid starting September 3. Let me move on to outlook on Slide 13. And I will refer only to the guidance for this year, as the guidance for 2025 to 2026 is currently under review as part of our annual planning process. We expect brent oil price in 2024 to be between $80 and $85 per barrel. Given better-than-expected production for the first 9 months of the year, we increased the guidance for our hydrocarbon production to around 108,000 barrels of oil equivalent per day. We expect inflationary pressure on our cost to persist. And therefore, we see the production cost at around $16 per barrel of oil equivalent for the year 2024. In Refining and Marketing, we currently estimate an average refining margin of around $9 per barrel in 2024, lower compared to our previous guidance given the market trends visible starting with the third quarter. The refinery utilization rate is still estimated to remain above 95%. As Christina mentioned earlier, we broadly maintained our CapEx guidance. Organic CapEx is expected to be up to RON 6.5 billion in 2024. Additional investments for the announced M&A transactions would bring total CapEx to around RON 7.5 billion. In 2024, we expect a positive free cash flow before dividends, but lower year-on-year, driven by strong operational performance, offset to a large extent by significantly higher investment. We estimate demand for retail fuel product in Romania to be above 2023, while gas and power demand to be stable year-on-year. We expect both total refined product sales and retail fuel sales to be higher year-on-year. Our total gas sales volumes are envisaged to decrease mainly on lower supply, both from equity and third parties. The net electrical output is expected to be higher year-on-year, reflecting a shorter shutdown of the Bright power plant. With this, I close our presentation, and thank you for your attention.

Thank you, Alina. [Operator Instructions]

We will take our first question -- and the question comes from the line of Ioana Andrei from Alpha Bank Romania.

I have some questions. First, you mentioned the portfolio optimization through assessing selective field divestment. Can you please give us a guidance on what and when to expect regarding divestments? Second, if I may, a clarification regarding taxation, you currently have a tax on turnover that stands at 0.5%. Starting with 2026, this tax will increase to 1%? And is there a time frame? And my last question, regarding the refining margin, you lowered the guidance for 2024. But what about 2025-2026? I know that you mentioned that this is under review, but can you give us your view on the refining margins? That's all from my side.

Ioana, thank you very much for your questions. I'll take your first one, then Alina will take your second one on taxation, and maybe I'll come back to your third one. So I think your question on sort of portfolio divestments, I think, was -- so referring to a statement we have with regards to our E&P portfolio. We don't actually give any details. I think just the main point is to say that we will continue to look about whether there is value in high-grading our portfolio, to make sure that we're concentrating on investing in both areas. So at this point in time, there is nothing to announce to you. But when there is, we will, of course, let you know.

Hello Ioana from my side. So with regards to your question related taxation. So basically, for the year 2024 and 2025, this 0.5% tax on revenues is applicable to both OMV Petrom SA and OPM, our OMV Petrom Marketing Inc. This is -- this tax is applicable starting to -- only for these 2 years. Now starting 2026. For OPM, OPM will go into the -- this higher -- between 1% of the sales and 16% of the profit tax. So this will be applicable only for OPM. And with regard to a bit of an estimation. So if we look at 2024 and 2025, the 0.5% that is up to RON 250 million per year for this -- each of these 2 years. And when it comes to 2026, we talk about less than RON 100 million per year for OPM only.

Coming back to your third question on the refining indicator margin. You're correct, we have lowered the estimate for 2024. As we mentioned for the -- for the third quarter, it was mainly due to weaker gasoline and middle distillate crack spreads. When you look at the full year, I mean, we do see an oversupply position in diesel. In part because of the new refinery in Africa coming on. But also, I think, we can see the shifting of demand in gasoline as well, coming after the end of the driving season in the third quarter, in part being replaced with heating agricultural demand in the fourth quarter. I heard your question with regards to 2025 and 2026, you're right that we will look to give you an indication of that when we talk to you -- when we give you an update in February and see you then. I hope that addresses your questions, Ioana.

We will take our next question from Oleg Galbur from Raiffeisen Bank International.

Oleg Galbur from Raiffeisen here. I hope you can hear me well. I have the questions, rather some clarifications. The first one is on the E&P segment. I have noticed that the evolution of the depreciation expense for the segment stood on a declining trend in the previous 2 quarters. So firstly, could you please explain why is the depreciating decreasing in Q2 and Q3 on a quarter-on-quarter basis? And secondly, what should we expect going forward? And then on OpEx per BOE, which has increased quite in Q3, and I understand the drivers behind this increase. However, since based on your full year production guidance, the oil and gas output in Q4 should not increase on a quarter-on-quarter comparison, so we expect a continuation or continued deterioration of the OpEx per BOE in the last quarter of this year. And lastly, on Refining and Marketing, just a few words. And if you cannot answer it right now, I'm happy to talk to our IR team afterwards. I noticed that the CCS inventory valuation effects were higher than, at least, my expectations in the third quarter. And for example, last year, in the third quarter, the change in Brent price was even higher than this year. However, the inventory valuation effect were significantly lower. So maybe you can elaborate a bit on it.

Okay. Alina, do you want to take the first question and the second question? I will take it on the third one, maybe offline probably.

So with regards to depreciation, there are two main impacts triggered a depreciation decline. On one hand is the UOP depreciation is always based on unit of production, so lower production, lower depreciation. And the second reason is that Q3 last year, we had some one-off type of impairment at that time booked. So by comparison, this will -- this shows a decline in depreciation in this quarter. If we look going forward, I think the only thing we can predict you should calculate based on the unit of production, so estimated based on our production guidance, because otherwise, the one-off impairment, this is not something we can predict.

And I think your question on the OpEx per barrel was obviously -- you understood our explanation with regards to the third quarter and your sort of estimate with regard to the fourth quarter, given the production we had put out. I mean I think it's fair to say that we continue to see increasing pressures on the cost side, particularly on personnel costs, given the inflation rates that we've seen in the past few years and continue to see. However, we work very hard to try and offset them through efficiencies overall. So I think our forecast that we've got for the year is -- yes, but we are constantly having to work and then fight against an increasing cost base, particularly when the production is going down, but we continue to focus on that and have lots of efficiency efforts underway. With regards to the third question, shall we take that offline on such a specific one, if that's okay with you, Oleg.

It was nothing special or an adjustment or anything like that. So we'll really have to look into that and we'll come back to you.

[Operator Instructions] While we are waiting to see if there are further questions, I see Tamas has just registered? Let's take Tamas' question.

Tamas Pletser from Erste Group Research.

I got one question. How do you see the development of the gas prices in October and during the fourth quarter? And how does this regulatory change affect your profitability? I mean, I know that you have a higher storage obligation this year than previous year. So will it increase or will it boost your fourth quarter earnings, especially if the prices are getting higher in the gas side during this period?

Thank you, Tamas, for the question. So on the gas price, we see an increase in Q4 of the gas prices. Still, what we see is that BRM prices remain lower than tax and TTF. So there is decoupling there. If we look historically, we see a difference of EUR 1-EUR 2 per megawatt. Now we see that it's much more than that, EUR 5-EUR 6 per megawatt. This is driven by different market fundamentals in Southeastern Europe, which gas prices mainly pipeline gas and less LNG. While in Central Eastern Europe, we see more LNG and also some uncertainty with regards to U.K. and Russia transit agreement. So this is foreseen to continue. And yes, we see some increases in gas price also here in our region. With regards to regulatory changes, we have these changes starting April 2024, which affect us quite significantly. I would say the more negative impact is on the power side, and this comes primarily from this CO2, non-recoverability of CO2. There is some impact also on the gas, but not to a significant extent.

And this gas storage issue, does it have an impact on your profitability? Because as far as I know, you have to store more gas ahead of the winter heating season.

Yes, we do. I mean it all depends in the end on what level we will be able to sell this gas. But for the time being, yes, we do have higher storage than in the previous year, indeed.

But, is my assumption correct, if the gas prices are higher generally in the fourth quarter and in the first quarter next year, this is going to be an addition to your profitability?

Yes. Now, if you look -- yes, and it will be reflected primarily in the E&P segment, yes.

We will take our next question from Jonathan Lamb from Wood & Co.

Hi. Can you hear me?

Yes.

Very well, Jonathan.

I wanted to ask a question around oil prices. We've seen oil prices come off quite dramatically because of the lack of a wall. And I'm wondering how this is going to impact you in the fourth quarter in terms of working capital. But also, are we getting close to a level where there might need to be impairment in any of the upstream? Or is it -- are we not there yet?

Thanks for your question, Jonathan. I'll let Alina talk on that, particularly on the impairment side, but I feel like we have a pretty robust E&P business.

Yes. So, indeed, we do the impairment testing, we look for triggers for impairment every quarter, but we do a more thorough analysis every year in the fourth quarter. I mean based on what we see right now around us, we do not see any reason for anything significant. But of course, we need to do this work in the fourth quarter if -- and if there is anything with regards to that, we will come at the beginning of February. With regards to impact on net working capital, indeed, if we see a decline, we will have a positive impact, at least from the inventory side in the net working capital from a decline in oil prices. We do expect seasonally some decline on gas, gas volumes as well, which should trigger some positive impact on the net working capital in Q4 as well.

While we are waiting to see further questions, maybe we can take some questions that we got off-line. So I will read [indiscernible]. What is the current [indiscernible] of the oil and gas results of OMV Petrom, the results slide [indiscernible] as related to that, are any plans to upgrade our produce opportunity in [indiscernible]? Second, if you have any plans to move [indiscernible]. And the third one, if we can elaborate on the other adjustment line in the operational cash flow.

Okay. Alina, I will take the first three, if want to take the other adjustments in the cash line. So thank you for your -- thank you for your questions, overall. Maybe I'll start with the with the pet chems one. I think actually in our strategy, I think I've laid out quite clearly our big sort of growth areas, investment areas stay around growth in regional and gas as well as lower zero carbon transition projects that we want to invest in. We are doing some work on new aromatic complex in the Petro oils refinery, but the bulk of our new investments are going towards energy transition projects and to gas opportunities in the Black Sea overall. With regards to the oil and gas reserves, I think it was the RTP ratio that you're looking for. It's just over 10 -- it's about 10.3 for the company overall. That does include a small amount to do with Neptun Deep. Looking at the overall traditional -- what we call our traditional E&P business, which is a huge part of our near-term cash generation of the firm. We're investing around EUR 400 million/EUR 450 million a year into that business. Obviously, focus a lot on the drilling and the workover program as well as on facilities and general maintenance. And we have been very pleased with the production performance that we have seen from the E&P team so far this year, hence the increase in expectation of the full year production number. Alina, on other adjustments?

With regards to other adjustments line from the cash flow the previous quarters, both Q2 2024, but also Q3 2023, were influenced by solidarity contribution, this is adjusted in the other adjustment line in order to expect overall operating cash flow debt payment done for solidarity contribution. This was not the case in this quarter in Q3 2024. And also, we had some net expenses for fair value for derivatives through P&L, mainly related to our CO2 and our contracts that were effective in this line. In the quarter, we also had very small amounts with regard to such derivatives.

[Operator Instructions]

We will take our next question, and the question comes from the line of Daniela Mandru Petrovici from Swiss Capital.

Regarding the last quarter of the year, I would like to see what do you see the refining margin in the Q4 this year? And going forward with the [indiscernible] and refining margin declining sharply, what is the OMV Petrom's outlook for refining margins in 2025. I know the question was already raised, but I prefer to insist a little bit on it. And more than this, what are the plans to adjust refining operation or diversify the product at enhanced resilience here. Then for the full year regarding the regulated -- the sales of regulated gas volumes, my last information is that for the full year, the amount stands at 7.9 terawatts. I want to confirm this with you. And what is the regulated volume allocated for the first quarter next year? I'd like not [indiscernible] this and if it is available. And now regarding -- also regarding the total gas sales for the year, I know your budget is 39.3 terawatts. I have a preliminary estimate of 48 point -- 40.8 terawatts. I would like to confirm my estimate with you if I'm -- if I'm in line with what you would estimate for the full year, revised estimate, of course, because the budget is 39.3.

Thank you for your questions, Dana(sic) [ Daniela ]. So I will take your refining orientated questions, and Alina will take your gas oriented questions. With regards to the refining indicator margin, I think it's probably possible given what we say to some degree, I think, probably to back calculate what the fourth quarter would look like, and I think we estimate that to be around 7. And then with regard to 2025, I think I will have to hold to my same comment that I said earlier on, otherwise, it would be unfair to -- I think it was the Ioana who asked that. But be sure we'll come back to you in February when we meet again overall. And I think with regards to the overall refinery, I mean, of course, we are constantly looking to flex where we can to make sure we optimize the asset. The performance has been very strong on its utilization. We were at 99% in the third quarter, and we're, I think, quite good at knowing how to optimize depending on the different product suites that will go on and how the prices are changing in the market overall. So we will obviously continue to look to do that. Alina, for a few questions on the gas side?

So first, with regards to regulated sales volumes that we -- volumes that we sell to households and district heating companies. For Q3, we have 2.3 terawatt hour, which makes an overall 8 terawatt hour for full year 2024. And when it comes to Q1 2025, we have a [indiscernible] indicated of 2.6 terawatt hour for Q1 2025. With regards to your second question related total gas sales, our total gas sales volumes are envisaged to decrease versus previous year, mainly on lower supply, both from equity and third parties. We cannot disclose exactly the value. You are not far away with your estimation.

If there are no more questions, I want to thank you again for taking part in our conference call. For further information, please do not hesitate to contact our Investor Relations team. Until our next call, we wish you all the best. Thank you.

That concludes today's conference call. Thank you for your participation, ladies and gentlemen. You may now disconnect.