Galp’s new CEO promises changes in May

  • ECO News
  • 22 February 2021

In his first conference call with analysts since taking office, Andy Brown's priorities are to speed up the energy transition while maintaining financial discipline and ensuring stability.

Two weeks in office, the new CEO of Galp Energia, Andy Brown, praises the company he found when he arrived, which he attributes to his predecessor Carlos Gomes da Silva and the teams on the ground. However, he believes that it is necessary to define a clear strategy, which he will do in May.

“I am very excited about what I have found. Looking ahead, we need to clarify the strategy. We have a strong portfolio, but we can’t be afraid to make tough decisions,” Brown said in his first conference call with analysts as CEO of the oil company. Andy Brown announced that the company would hold a Capital Markets Day in May, where he will take stock of his first months as Galp’s CEO and point out strategic priorities.

Still, Andy Brown left some indications. “Have no doubt: we will be sustainable growth oriented,” he said, stressing that his job will be to speed up Galp’s energy transition, maintaining financial discipline and ensuring that the company is stable and clean. “Despite the enthusiasm for the future, the short term is challenging. The pandemic has not passed and we have to be prudent in investments. We will be disciplined.”

The CEO’s comments came after the release of the company’s results this Monday. Galp Energia recorded losses of 42 million euros in 2020, a result that compares with the 560 million euros profit achieved in the previous year.

In addition, following the decision to concentrate refining activities in the Sines complex, discontinuing refining operations in Matosinhos as of 2021, and according to “current best estimates”, Galp recorded 35 million of restructuring costs, as well as impairments and provisions amounting to 247 million, “all considered as non-recurring events”, for a total after-tax of 200 million euros

In contrast, CFO Filipe Silva pointed out that average production in the working interest indicator grew 7% compared to the previous year, to 130,000 barrels per day. Investment also increased by 5% in 2020 to a total of 898 million euros (42 million euros more than the previous year).

Net capex is expected to be between 500 million euros and 700 million euros in 2021. “A large amount of money will go into renewables,” explained CEO Andy Brown. “We would like to grow the renewables portfolio and increase its resilience,” he advanced, explaining that of this sum, 200 million euros will be invested in strengthening renewables.