Good morning, ladies and gentlemen, and welcome to MOL's Q2 2025 Results Conference Call. My name is Marton Teremi, Head of Investor Relations. The manager who is presenting MOL on today's call is Dr. György Bacsa, Executive Vice President, Group Strategic Operations and Corporate Development.
Mr. György Bacsa.
Dr. Ákos Székely, Senior Vice President of Group Planning and Reporting. Mr. Zsombor Marton, Executive Vice President, Upstream. Mr. Gabriel Szabó, Executive Vice President, Downstream. Mr. Péter Ratatics. Technical information: We continue to use Microsoft Teams as a platform to hold our conference calls. The presentation can be downloaded from our website, molgroup.info, and we will be sharing the slides in Teams too. After the presentation, we will move to a Q&A session where you will have the chance to ask questions by using the Raise Your Hand function on Teams. Please keep yourself muted throughout the call except when asking a question. I would also like to draw your attention to the quarterly statement on slide number two. Now we can start the conference call with Dr. György Bacsa taking us through the highlights of the second quarter.
Good morning, everyone. Thank you for joining the call. Let me start with page number four. You can see that all our first half results and also our message: the theme: Uphold our Guidance for 2025. So it has a main figure: profit before tax rate is $782 million. Clean CCS EBITDA was above $1.5 billion. Our second quarter results reflect the continuing slowdown in global and regional economy, and also the normalization in oil and gas prices in the industry. It also shows our strong internal performance, which we were able to counterattack the volatility of the market. The road ahead of us is bumpy, but we uphold our guidance for this year, and we confirm this in our abstracts. Let me summarize on the next slide the most important internal developments in the second quarter.
On page five, you can see the results of the second quarter itself, including the profit before tax at $236 million, the clean CCS EBITDA at $685 million, the operating cash flow after working capital adjustment is $1.1 billion, and our CapEx spending is $444 million. I think the internal performance also shows the economic slowdown, shrinking in one year, but also, for example, in downstream, these were all offset by strong volumes and the increase in the performance of the segment itself. Consumer services has increased. It's supported by strong seasonal, both fuel and non-fuel sales. Circular economy services EBITDA was -$10 million. It's because of seasonality and some higher expenses. Operational and other developments. I would like to highlight the focus agreement on the exploration in Sarmatic Robustan in Azerbaijan, where we got a 55% stake.
I also would recommend that in this quarter, we paid out $2.75 for a dividend per share. We launched a resilience program in downstream, Tomorrow Downstream, from which we estimate and in later slides the downstream EBITDA, Mr. Szabó will talk about it. We expect a continuous or a sustainable efficiency improvement in the magnitude of $100 million, but we also in a positive EBITDA effect of $200 million U.S. dollar beyond 2027. We also had a major step in our CSR activity. We purchased the operating company of Budapest University of Technology and Economics. Now moving to the next slide. Our TRI results, which is slightly above 1.3, so the TRI at 1.35. Our guidance, we keep at 1.3. Most of the injuries are dedicated to food and sleep related, which is a dive into our industry-specific risk and hazardous activities.
We also launched several programs to increase awareness and cautious behavior on all our sites and on the roads. Thank you for your attention. Now I would like to give the floor to Ákos Székely.
Thank you, György. Let's start with the NPD evolution of MOL's second quarter results. As usual, the heads of each key segment will provide a detailed insight into their businesses. I'll take a moment to address three segments, see areas that fall outside this scope. Starting with gas midstream, the results came in at $39 million, year-on-year decrease. Market demand for transportation services remains healthy and robust during the quarter. However, lower regulated price levels and cost inflation weighed on EBITDA. That should not surprise us as we expected. Regarding the corporate and other segment and intersegmental management, a couple of comments.
Let me first highlight that the BME transactions had a negative impact on the group P&L. As the future liability arising over the next 10 years from the transaction was recognized and formed in the balance sheet, with the corresponding expenses also recognized. Let me note that the transaction did not affect cash flow in the second quarter, and the transaction will impact cash flow gradually along the next 10 years. Beyond transaction effects, we do not expect that the BME operation will have a material impact on the group's financials going forward. Let me highlight that after adjusting for this item, group clean CCS EBITDA amounted to almost $783 million in the second quarter, more in line with the market consensus.
After adjusting for the BME transaction, clean corporate expenses amounted to $92 million, which mostly reflects the seasonal expenditures in the second quarter, as well as the lead segmentation of oilfield services to upstream segment starting this year. The third point, this is the intersegment elimination. The intersegment elimination had a positive contribution to EBITDA of $19 million due to a decrease in the amount of home-produced crude oil inventory, leading to a lower elimination. Moving to CapEx, the total CapEx amounted to $287 million in the second quarter of 2025. Organic CapEx year to date is $444 million, lower by 35% year- on- year. The CapEx decrease was driven by less turnarounds in downstream, with the substantial expenditure being lowered by roughly $100 million in the second quarter compared to a year ago.
Growth and efficiency CapEx in the second quarter was slightly higher year-on-year as the spending in upstream continued to be driven by ECG, while the key investment in downstream continued with crude diversification and DCU Rijeka and also several smaller petrochemical projects. Inorganic CapEx amounted to $3 million, and this is related to ENI acquisition in Q1. We have been already discussing in the last IR call. Clean CCS EBITDA, $1,570 million in the first half of 2025, translated to an added cap of $496 million. Regarding the components of the bridge, let's see the details on the next slide. Clean CCS effects showed a negative figure of $74 million in the second quarter, which was due to a lower oil price that led to a negative CCS adjustment, which is partially mitigated by the effect of cleaning of CO2 cores.
DD&A was $430 million in the second quarter of 2025, up by $76 million compared to the first quarter. A little less than half of this increase was due to a dollar weakening, while other drivers were mostly one-off at Consumer Services and upstream. However, let me note here that DD&A has been on an increasing trend due to a higher amortizable asset base for the group, affecting pretty much all segments to some degree. There was a gain on financial line of $33 million at the fully depreciated during the quarter. Just a reference, the end of June versus the end of March, 8% against U.S. dollars and 1% against the euro. This was the appreciation of Hungarian forint. Income from acquisitions amounted to $5 million, mainly driven by the seasonal fluctuation in the exchanges.
Also, let me remind you that last time we discussed that one-off of $39 million gain in the first quarter from the divestment of MOL stake in NRLs. Once adjusting for this impact in the first quarter, the quarter-on-quarter change is positive. Income tax came at $127 million in the second quarter, decreased quarter-on-quarter year-on-year. Although profits before tax dropped, effective tax rate was as well above the average. The main reason for this increase is that the tax rate was finalized when preparing the statutory financial statement in Slovak in June, and that resulted in a higher tax expense by $50 million. To remind you, we are not facing surrogacy taxation anymore in Slovakia.
Moving on, let's look at how our cash flow evolved during the quarter. Net working capital supported the cash flow with a release of $157 million in the first half of the year, with the second quarter release of $394 million. This is mostly due to the seasonality as inventories were depleted during the quarter before building stocks for the scheduled turnaround at the end of the summer. Operating cash flow reached $1,135 million. Finally, let's look at the gas position of the group. The net debt level remains stable in the second quarter and slightly over $2 billion after dividend payment, which you can see on the slide, and a relatively high cash tax paid, which reflects the strong operating cash generation in the first half of the year and the strength of the balance sheet.
Consequently, net debt remained well below our guidance threshold and stands at 0.69x EBITDA. Now I would like to hand over to Gabriel to discuss the downstream performance.
Thank you very much, Ákos, and good morning, everyone. Maybe get to my first slide, please. Yeah, thank you very much. MOL downstream clean CCS EBITDA amounted to $307 million in the second quarter, marking a 25% drop year-on-year. On the refining side, EBITDA decreased year-on-year by 9% to $359 million. This performance is mainly due to a slowing economic environment in the region, as mentioned at the very beginning of the call, with fuel market demand shrinking roughly 1% year-on-year in the CEE countries. Driven by good availability at our refineries, with process volumes 24% higher, both in Hungary and Slovakia, we increased sales volumes to defend our market share and sold volumes were significantly year-on-year.
Regarding petrochemicals, as you can see, despite the higher sales, EBITDA amounted to a negative result for -$52 million, as profitability remained depressed in line with general times in European industrial demand. Now let's have a closer look at the margins and price environments. Refining margins were down year-on-year to around $6 per barrel from around $7 per barrel a year earlier. The general normalization trend of 2024 seen until the spring of this year was disrupted in the second quarter as geopolitical tensions and other supply-side events resulted in widening cash spreads, especially in diesel. This had a positive impact on MOL's refining margins as well, and July figures suggest that it can last for some time. The Brent oil spread based on DAP India quotations slightly narrowed, mainly as a result of higher demand from Turkey and India.
Regarding petrochemicals, the margins bounced back in the second quarter, mainly as global gas prices took some time to filter through price quotations. As the July margins figure shows, the uptick in the second quarter has unfortunately been temporary. Now let's have a look on the waterfall side and see the components of the second quarter results year-on-year. Changes in the refining price and margin environment had an effect of $184 million on the EBITDA, and the drop in petchem price and margin environment had a negative impact of $29 million. The impact of higher volumes, however, could counter most of the adverse price and margin impact. In the category others, we show a negative contribution of $74 million. The general inflation pressure caused a minor decrease in OpEx, mainly maintenance.
OpEx was higher due to more small-scale turnarounds this year as compared to the large turnarounds last year. Now a few comments about the operational updates. With regards to crude diversification, the first shipment of CPC crude from Kazakhstan was unloaded in Croatia, as you might see it in the media, and heading to be processed in our landlocked refineries. Although this shipment provides less than 1% of the total processed crude volume in Bratislava and Zasavo, we continue to strive to enter and deepen our cooperation in order to expand our options for crude sourcing. For today, I have also prepared additional slides about our Tomorrow Downstream program. As we all know it internally in MOL Group, we call it the To-Do program. As Mr. Bacsa mentioned, this is a real resiliency program.
This program aims to strengthen the downstream EBITDA generation and intends to prepare MOL Group to be flexible for potential shocks to come and enhance competitiveness in a rapidly changing environment. It overreaches the whole scope of activities within MOL Group downstream, so every control room, field, lab, and office will be affected by this program. It is not just the cost efficiency, so it's not just about how to work harder, but it's about how we operate, how we sell, and how we invest. I try to explain to my teams that we should do things smarter, not just harder. It includes elements of cost savings, availability improvements, and together with margin and yield optimization makes up most of the value that we target to achieve. As you can see, the program is about $500 million and takes roughly two years for the full effect to be felt.
To boot, there is no material CapEx needed or projected. This also changes our strategic ambition upwards. We planned with efficiency improvements already in our $1.2 billion strategic target we disclosed last year. Not the full $500 million of the Tomorrow Downstream program will be an addition to that. However, we believe that roughly $200 million will come as an addition, meaning $1.4 billion EBITDA targets for downstream beyond 2027. With this, I hand over to Peter and to Consumer Services. Thank you very much.
Thank you, Gabriel. Good morning to everyone. Consumer Services marked 27% EBITDA growth in the second quarter of 2025 despite the challenging macroeconomic environment. The main contribution came from the fuel side, but non-fuel margin remained also on a growth track and also contributed to the increase. The rise in the OpEx contributed altogether to $12 million in this quarter, respecting the continued wage and welfare contracts in the region. With the weakening of the dollar, the asset's impact was also more significant than usual, and that also supported our reported EBITDA numbers. Let's turn to the fuel slide, using that as the biggest contributor this quarter, the fuel margin. Let's start with the volumes. Altogether it grew by 1% year-on-year, and the throughput per site remains close to flat.
As far as the unit margin concerns, we were able to increase the unit margin before the driving season started. Most notably, actually in two countries, in Romania and Croatia, where these two countries were the main factor of deriving EBITDA. Let's go deeper into these two countries. In Croatia, the regulated fuel price gap was widened at the very beginning of the year. Just recently, the full market was liberalized, and from July onwards, there is no regulated fuel margin in place in Croatia. That's very important for us this quarter, which is July and August and also in September in Croatia, since it's a very seasonal country. Also in Romania, just as I have already mentioned in the previous quarter, the structural changes in the wholesale market continued and resulted in lower wholesale prices, which all the retailers were able to capture.
That's why I assume the unit margin in Romania increased. Apart from that, the long-spending trend of a higher premium fuel share continued in the second quarter as well. That's also very important for us since the premium fuel unit margins are much higher than the labor rate. All in all, more than 90% of our fuel volumes have been sold on a non-regulated market. Now, after the liberalization of the Croatian market, only one country is left, that's Romania, but altogether, the Romanian volumes represent just close to 8% of the total volume. Other than that, all the other markets are working properly. The last slide, first of all, the non-fuel segment. The downstream domain is broadly in line with the earlier trends.
Although we do see some first terms of the macro slowdown, although the non-fuel sales showed an 8% increase, margin grew by 7%, which shows an intention to focus on still a stronger margin to keep and attract further customers to transact despite the challenging commercial environment. We really focus now on the sales instead of the margin at the current moment. Thank you very much. I will hand over the word to Zsombor.
Good morning, everyone. Upstream, the EBITDA performance amounted to $276 million in the second quarter of 2025, marking a 13% drop quarter-on-quarter. With the production remaining on high levels and internal performance, including no material one-offs during the quarter, the major driver of the EBITDA decrease was a drop in oil and gas prices. Even in such an environment, upstream continues to deliver a strong free cash flow on the healthy levels, nearing $200 million for the second quarter of the year. If we have a look at how it translated to unit cash flow, the hydrocarbon prices changes are well reflected in the realization, but we are still above our strategic $20 guidance of the unit free cash flow. If you move on to the next slide, what you can see here is regarding the components of the changes quarter-on-quarter and year-on-year.
The main message is that there are no surprises. quarter-on-quarter, it is clear that the hydrocarbon prices change was the main driver of the results. Change volume effect was positive due to two cargoes listed in Azerbaijan, one actually jointly with MVM. On the year-on-year, the price effect was not material as the lower oil price was coupled with offsetting effects to higher gas prices and the FX impact. The ACG cargo effect had a negative impact on results year-on-year. Lifting costs contributed negatively in light with the increase in unit OpEx year-on-year. Two one-off items lifted results by $21 million in total for the year-on-year. One is the short-term receivables impairment, which affected the base period last year, and the oilfield services business unit, which was transferred to the upstream segment as of January 1, 2025.
Moving to production, in the second quarter, we reached 93500 bbls of oil equivalent per day, which is well in the upper half of our guidance range, 92,000- 94,000 bbls. If we look at the individual assets, production in Hungary was broadly uninterrupted and close to 38,000 bbls of oil equivalent per day. That's a strong performance. Hungary to Croatia, we continue to be exposed to a stronger natural decline. Regarding international assets, production decreased mainly due to logistics issues in the Kurdistan region of Iraq and the Pakistani curtailment. In Iraq, light tank operation was disrupted due to lack of available trucks and transportation during the Israel-Iran conflict, while there is a bottleneck in Pakistan due to the curtailment of service by the local transmission system operator. If we see a bit to the future, going forward, the July production rate is 91,000 bbls.
That reflects the latest round of drone attacks in the Kurdistan region of Iraq. Following those drone attacks on the nearby assets in the middle of the month, there has been a full shut-in of operations on the tri-country and the production could just restart after this week. We are confident that the production guidance can be raised for the full year. Let us look at the evolution of unit OpEx and the CapEx. I will talk also about strategic milestones too. In the second quarter, the OpEx shows an increment year-on-year, 11%. Without the asset's impact of the depreciating dollar, the year-on-year change would be around 8%. Otherwise, the production structure shifted towards a bit higher OpEx assets, moving group OpEx slightly higher, which the underacquisition in Hungary also contributed to. We are still integrating that operations into our portfolio.
Despite the high inflationary pressure, we are continuously executing projects for production optimization and facility simplification to deliver strong performance on unit cost. With regards to the CapEx, organic investments moderated by 3% at the half of the year. Certain works in Azerbaijan have been rescheduled for the second half of the year for the time in effect. Let me also update you on two investments that take years to materialize, but are strategically important milestones in our business development. We have kicked off on the main refinement of investment this season together in partnership with ENI to jointly invest into the development of the Irina gas field in the northern Adriatic. This will be on a 50/50 basis. Gas production is expected to be in the first half of 2027 with a maximum daily output of 300,000 cu m per day.
Another important milestone from Azerbaijan is the key terms we're signing with SOCAR on joint investment in the Sarmatic Robustan area mentioned even in the early phase of the call. Although we're still at the phase of negotiating the detailed PSA, we expect to sign it in a very recent future. We are excited about this opportunity as 65% shareholders and operators' responsibility for MOL. With that, let me pass the floor to Pethő to discuss the circular economy services of MOL.
Thank you, Zsombor. Good morning, everyone. The EBITDA of circular economy services marked a negative $10 million in the second quarter of 2025, which brings the first half of the year at slightly above break-even. Results were affected in this quarter by seasonality, as the expenses rose related to the increased volume of return bottles in the deposit return system, as well as some higher amounts of waste collected, mainly the green waste, which is bringing us volume, bringing us cost, but no income. Let me note that efficiency enhancing efforts are continuous, including the renegotiation of prices and fees with our subcontractors. Overall, for now, the circular economy services segment remains in an early-phase mode with its financial performance characterized by high volatility. Regarding the main CapEx items, there has been progress in the main projects.
The deposit refund network with the reverse vending machines has grown further, and developments on waste yards and the collection infrastructure have been progressing as planned. Thank you. Let me give the floor to Martin and to your questions, of course.
Thank you very much. That concludes the formal part of our presentation. I would like to now open the floor for the Q&A session. Please indicate if you'd like to ask a question by using the raise your hand function on Teams. Yes, Anna, please go ahead.
Good day. Thank you for taking my question. First would be around this Tomorrow Downstream program. Can you please provide a split, a rough split, on which measures will lead to this $500 million of EBITDA contribution? Maybe if it's not possible at this stage, maybe you can just give us some color on what will be the key measures that you plan to implement over these two years. That would be the first question. The second question will be around Slovakia tax. This quarterly taxes that you are paying, will the rate of around $15 million per quarter stay the same despite this increase of the windfall tax that we saw? The final question is just clarification regarding this JV in Adriatic. Can you please repeat how much of gas production of gas is expected? Thank you very much.
Thank you, Anna. Thank you very much. Let me respond to the first part of your question or your first question regarding our Tomorrow Downstream (To-Do) resilience program. As I mentioned, we will target all the areas, all the organizations, and we would like to do things smarter. I would mention that we would like to tackle the availability, the energy efficiency yield, and there are more than 200 actions or Excel table or database, with 200 actions there. It will have an impact in each and every organization of downstream.
The next question, this is about the Slovakian taxation and the quarterly specialty in regulated areas. Yes, the last time we discussed that our expectation is that the overall yearly figure would be around $50 million-$60 million. Yesterday's idea is $20 million. Yes, somewhat behind the proportional part. At the moment, we keep the guidance of this $50 million-$60 million for the year. You can calculate how much is the quarterly figure.
With regards to the Irina joint venture with ENI, it also is a 50-50 joint venture. We will start the operations after the final investment decision and expect first gas, first half of 2027. That's a development project. The maximum daily output will be 300,000 cu m per day.
Thank you very much.
Thank you. Oleg, please go ahead.
Yes. Good morning, and thank you for the presentation. I have a few questions. A follow-up on the Tomorrow Downstream program, please. Currently, you are booking some gains from the ability to import Russian crude oil with some of the price and brand. I was wondering whether your EBITDA target of $1.4 billion for beyond 2027 assumes continuous gains from imports of Russian crude oil. If not, then what is the underlying assumption? Secondly, also on the downstream business, I was wondering whether you could provide more color on the evolution of the refining, specifically stream clean CCS EBITDA on a quarter-on-quarter basis. Frankly speaking, when looking at the moving part, namely refinery utilization, which was higher model, refining margins have been stronger. Sales volumes were higher. I would have expected a higher quarter-on-quarter increase, which, however, in dollar terms was below 5%.
I was wondering whether there are other moving parts which are worth mentioning in order to understand this evolution, such as, for example, what happened on the import of Russian crude again, because this is having quite an impact on the refining results. On the consumer services, this termination of retail fuel price regulation in Croatia, would it help us understand what would be the impact on the stagnant results as a result due to the termination or liberalization of fuel prices in Croatia? Lastly, on the acquisition of the Budapest University of Technology , since it will be consolidated in your financial statements, would you please tell us what we expect going forward in terms of contribution at this level?
I know that you mentioned that the free cash flow is expected to be positive, but what to expect as an impact in the key analysis would be very helpful. Thank you.
Thank you, Oleg. I would like to ask Gabriel to start.
Yes. Thank you, Oleks. Good point. In terms of the supply of the Russian crude in the period, in the coming period and after 2027, I think that we all hope that the war is over soon. In all our projections, we count with the normalized Brent euro spread, with the historic one pre-2020, pre-COVID era. Regarding the moving parts, as you properly mentioned, on the one side, the strong refining margin, high availability, good sales performance in terms of the volume, it's rather difficult to understand. I would mention that the high availability was not just reported on the other side, but in all refineries around us in the CEE region, which means that there were no unplanned shutdowns. From the supply and end customer point of view, the situation was stable. On the other hand, it means that there is a higher supply with, let's say, flowing demand.
As in the past, I used to praise the sales performance of my team. Now I believe we did our best to keep the market share. In terms of the sales prices, we were not able to achieve the levels, about the refining margin, the levels which we were able to report in the last season. I would not go to the art. The Russian crude, this is not a moving part. We comply with all the functions. There was no change in the reported period there. This would be this year's performance. Thank you.
Thank you. The Croatian impact is go ahead, Péter.
Yeah, thank you very much. Just to clarify that what was in place, especially it was a margin regulation, which means that there were a formula which were connected to the CIFMESC transportation, and they will unload maximum unit margin, but generated and directed the totem price environment in Croatia. That was eliminated. It means that all the market players from now on can truly set the prices on the totem. Will that mean automatically a significant increase on the totem price environment? I wouldn't say that it will be a harsh increase because anyway, the totem price environment was quite proper. Also, the unit margin in Croatia was not low at all. It gives us the possibility to make the proper competitive price environment in Croatia. Altogether, on a yearly basis, the total volume in Croatia is roughly 1.2 billion L.
If you would just calculate with $0.01 or $0.10 eurocent increase on the margin side, then that could, in theory, mean $12 million margin increase as a quantum increase. As I said, the market prices were quite competitive. The neighboring countries' market environment was also, I mean, a factor, but we have to take into consideration when we set the price. We will be very cautious with this because if it will start to just increase significantly the totem price environment, then might the regulator will change their mind. It's quite a kind of sensitive topic. I can't estimate one single number that what the effect will be at the end. It's more important that we have the possibility to react on the market freely.
I think the second or the other question that comes to me as well, the Budapest University of Technology and Economics and the impact on the EBITDA level or on the top line numbers. I think I have to kind of put it into a different angle. The structure or the whole kind of structure of this acquisition is a 10-year statement. The acquisition price will be saved in 10 increments. We have to kind of consider it rather as a research and development or even an innovation type of project from MOL's side. It's certainly not a CSR, and it's certainly not a traditional core business logic for what we are following here. It's more a kind of research and innovation and development budget.
Altogether, on a yearly basis, if you calculate it in dollar terms, it will be like $12 million per year, which is less than 0.5% of the yearly EBITDA of MOL Group. If we compare it with the large international or global energy companies, I think their yearly research and development budget is much, much larger than that in respect of the EBITDA percentage. I think MOL Group, especially in the middle of an energy transformation, has to have a very strong science base, transition and innovation base, or background to which actually we can turn to and also invest into this operation. Altogether, this technological university consists of 1,100 lecturers and researchers. They have 20,000, 22,000 students. I think that's a very, very good science base to whom they can turn to and build up joint projects, researches, and development.
Also, that cooperation or that investment will open up the gate for intellectual properties, different startup organizations, and ventures, once we can build up together with the university. With that, later on, we can expect larger even cash flows. Short- term, we do not expect that we will have EBITDA or we will have any profits or any dividends from these ventures or from this investment. We don't expect that we have to financially contribute anything else into this university. It means that on a yearly basis, the university will spend what they got from different sources, whether it be state sources, European Union sources, and also the tuition and fee, what the students are paying. The cost level of the university will be very strongly controlled by us. We will not allow that they will overspend what they have.
It means that roughly zero is at this level we can expect in the upcoming period. If any in the future profit or benefits will come out, that not necessarily will come out from the university side, but rather from the research and development utilization, either within MOL Group or with a startup venture. Thank you.
Thank you very much, Péter. Maybe just one additional follow-up question because you keep mentioning research and development. Could you maybe say a few words about in which area does this university specifically have competitive advantages in terms of R&D? Is it related to petrochemicals, refining, or other sales, which would be helpful for MOL as well? Thank you.
Yeah. As I mentioned, it's quite a large university with a lot of disciplines and different faculties. I think it's very, very strong. That can be a good connection to MOL Group, that the engineering, the technology, and also the informatic area, especially the artificial intelligence. I think that's the part where we and also not just MOL Group, but also other companies can benefit from. Also the energy efficiency, as I said. Everything around the engineering and technology, that's what the core competence of this university is. I think that's the area where we also can benefit in. I mean, if you want to turn and translate it into the MOL's unit, then I think the biggest user can be the downstream organization and also the circular economy.
Thank you.
Thank you. Ricardo, please go ahead.
Morning. Thanks for a particular question. First question that I have on your earnings release and then on the presentation as well, you mentioned some of the downside risks to the guidance, even though you have maintained the guidance for the year. Where do you see most of these downside risks coming from? Is that downstream, upstream, or a mix of the different segments? The second question is on petrochemicals. When you look at this negative profitability, what do you take in order to get this number to positive territory? Is the portfolio also ramped up enough to do that, or do you really need to see a proper margin inflection? Thank you.
Okay. Thank you. Dr. György Bacsa has had to step out of the room, but Mr. Viktor Zerla is the Senior Vice President for Strategy and Sustainability. We'll answer your question, your first question, Ricardo.
Thank you very much. The overall macroeconomic situation is pretty complex. Actually, Q2 and the first half was still pretty strong, even with the flowing demand and also slowing economies in the region. Although, of course, we see the downside risks, in the second half of the year, we expect some bounce back on the GDP side and on the macro side. I think what's also important is that the diesel has been pretty strong this year so far. This is not really a demand side story, but a supply side story. We believe that this trend will stay with us for some time. Definitely, this is one of the most important factors that tells us that we will be able to achieve the initial target. On the upstream side, we expect a similar price environment also, which would bring us to our guidance by the end of the year.
Regarding the second part of your question, regarding the petrochemicals, I have to say I'm not extremely optimistic. I think that there is a rebound needed from the bottom of the cycle. We are in this low margin environment for two years. There were some hopes, as I mentioned, that we saw some improvement in the petrochemical margins, but yeah, we do not see the demand. The supply is very tricky from Asia and also from the United States. Thank you.
Thank you.
Thank you. Mr. Tamás Pletser has his word.
Yes, thank you very much. Good morning. Two questions from my side. The first issue is what is the status of the decoupling of the Russian crude oil? I mean, in the second quarter, how did we proceed and what kind of CapEx did we spend on this? I'm very curious if you can share this information with us. Also, my second question is regarding your investments. I mean, the investors are pretty much pushing me to ask, is this football club you bought last year, is it in the conservation circle of MOL and the building of a new stadium for this football club? Will it also include in the CapEx of MOL Group or not? How do you treat this? This would be my question. Thank you.
Thank you. Thank you, Tamás. Regarding the decoupling, we are progressing as planned. I mentioned that there are thousands of projects and lots of engineers are really doing the hard work there. There are no changes there. Just to give you some numbers, we have tested 14 brands so far in the past three years. The majority of this CapEx we mentioned is going to be 2025, 2026. Quarterly, this last quarter, it was about $20 million there. What is an important point regarding the Russian decoupling, if I may say, is that what we see even currently is that the PTC incidents just assure us that the supply security is really threatened, cutting off the good bar and the supply to Europe. As you can see, what can happen once the terminal of the pipe is contaminated.
I believe that our saying on this, that we need at least two independent suppliers and several supply partners, just proves to be true. Thank you very much.
May I have just a follow-up here on that. I think some of you mentioned in the Hungarian press that you are considering also to use the Odesa-Brody route in order to get the two supply routes, as you mentioned. What is realistic? What are the challenges here? I mean, what is the position of this pipeline? What is the position of Odesa port? Obviously, do you see this to be feasible in the future to get some supply via Odesa, maybe Russian or non-Russian crude in the future, and get it to Slovakia and Hungary?
We are aware of the physical presence of this pipe. When I said that we would like to do things smarter or differently than we did it in the past, this could be one of the options. As you properly tackle that, what is the feasibility of it? It's a long way to go. It's a long way to go, yeah.
Okay, thank you very much.
Thank you. Thank you.
All right.
And yeah.
Sorry?
If you allow me, then I will continue to answer to the second question that you asked about the football club. Let me start first with a bit kind of broader perspective. During the past, I don't know, 15- 20 years, MOL Group was an active sponsor of the football in the region, not just in Hungary, but also in the neighboring countries as well as part of the sponsorship strategy of MOL. During the past period, we transferred those money to different owners, to different clubs in order to wear our brand. We had just very limited possibility to work with the clubs. Now, actually, we came to the conclusion, instead of spending this money as a sponsorship, we rather would invest into our own property or asset.
That's why we bought a club here in Hungary, one of the largest clubs and also one of the most historical ones with a lot of fan base, but not in a good shape. We acquired this club and the same, roughly the same amount of money what we spent in the past into sponsorship. That's after a restructuring. Actually, we are now spending into our own ownership. From a budget point of view, on a yearly basis, what we spend on this football club is practically equal with those sponsorships what we spent in the past to different clubs. Yes, we are the 100% owner of the club. MOL is the 100% owner of the club. That means that we have to consolidate it. You can see it in our books. The second part of your question was about the stadium project.
That will be a CapEx project from MOL Group perspective. We now just started to negotiate with different companies and also different foundations to try to spare the cost and not just bear all the cost by us, but also to find some sponsors as well for that. It's too early to kind of communicate any success on that.
Okay, thanks so much.
Okay. Thank you very much. If there are no further questions, I would like to end today's call. Please do reach out in that relation if you have anything to follow up with. Thank you and goodbye.
Thank you. Bye.