GDANSK- Austrian oil and gas group OMV said on Tuesday that legislative changes in Eastern Europe would hit second-quarter earnings in its energy business, while its chemicals arm was weighed down by negative inventory effects.
Changes in legislation that came into effect in April and a planned outage of the Brazi power plant in Romania will have a significant negative impact on OMV's clean operating result in the April-June quarter, it said in a trading update.
A clean operating result is based on the current cost of supply, and excludes one-off items and short-term gains and losses from energy inventory holding.
OMV, which will report full second-quarter results on July 31, said inventory effects would have a negative mid-double-digit million euro impact for its chemical division in the period, compared to the first three months of 2024.
"Overall this was a mixed quarter for the group. Lower production, inventory losses, lower refining margins and effects of the maintenance was offset by higher hydrocarbon prices, better chemical and fuel marketing margins," analysts at Erste Group Research wrote in a note.
Shares in the Vienna-based firm fell 1.4 per cent in early trading.
Average energy prices continued to climb in the second quarter, OMV said, with the average realised price of crude oil rising by 2.5 per cent from the prior three months to US$81.5 per barrel, and that of natural gas rising by 5.9 per cent to 23.2 euros per MWh.
Last month, OMV raised its 2030 earnings and cash-flow guidance citing a more favourable market environment for oil, natural gas and refining margins.