Ladies and gentlemen, thank you for standing by. I'm Konstantinos, you Chorus Call operator. Welcome, and thank you for joining the Tüpraş conference call and live webcast to present and discuss the fourth quarter 2024 financial results. At this time, I would like to turn the conference over to Mr. Doğan Korkmaz, CFO, and Mr. Levent Bayar, Investor Relations Executive Director. Mr. Bayar, you may now proceed.
Thank you. Hi everyone, good evening to all from Tüpraş headquarters in Istanbul, and welcome to our teleconference. I am Levent Bayar, Enterprise Risk and Investor Relations Executive Director. I'm here with Doğan Korkmaz, CFO, and team members from Tüpraş Investor Relations and Reporting Departments. Over the next hour, we will first go over our operational and financial results for the fourth quarter of 2024. Then we will continue with the Q&A session. I'll draw your attention to our cautionary statement. During today's presentation, we will make forward-looking statements that refer to our estimates, plans, and expectations. Actual results and outcomes could differ materially. Please refer to our financial reports and material disclosures for more details. These documents are available on our website. In the next two slides, we will provide you with a brief summary of the key highlights regarding the fourth quarter of 2024.
Then we will go into detail for each subject on the following slides. Now, let's take a look at the 2024 global market and company highlights. Mid-distillate cracks were under pressure most of the year due to weak global economic activity, causing high inventories in Europe. However, towards the end of the year, cracks showed an upward trend as capacity utilization declined due to maintenance activities. Gasoline cracks were primarily impacted by the increased capacity utilization, resulting in inventory buildup, which put downward pressure on margins. High sulfur fuel oil, on the other hand, benefited from OPEC+ cutback decisions. In the last quarter, demand showed signs of recovery, with global annual demand reaching 940,000 bbls per day, slightly surpassing the initial projection of 900,000 bbls per day. This increase had a modest positive impact on cracks in the final months of the year.
Differentials exhibited fluctuations throughout the year, widening due to Red Sea tensions in the early months. The OPEC+ cut decision in June led to a temporary narrowing of differentials, while increased non-OPEC+ production contributed to a widening trend in the last quarter. Brent crude prices experienced volatility driven by geopolitical uncertainties, OPEC+ policy decisions, and increased supply from non-OPEC producers. Prices fluctuated between $72 and $93 per barrel, with a 7% quarter-over-quarter decline in the last quarter, primarily due to rising non-OPEC+ production. At Tüpraş, we successfully completed our major periodic turnaround maintenance in the first half, leading to an improved capacity utilization in the second half. This contributed to achieving our highest annual production since 2019, reaching 26.7 million tons. A total of TRY 43 billion in dividends was distributed in two installments, reinforcing our commitment to shareholder returns.
With our investments in the PROPLAN project, a SAF feedstock procurement agreement, and the acquisition of an entity with a solar power license in Romania, we affirmed our dedication to the strategic transition plan and our long-term sustainability goals. Now, let's move on to the Tüpraş highlights in detail for the fourth quarter of 2024. The top chart represents a year-on-year analysis of our key operational metrics. Capacity utilization increased by 7% compared to 2023, reaching 93%. As a result, refining production hit its highest level since 2019 at 26.7 million tons. Annual sales volume reached 30.4 million tons, highest since 2017. Our consolidated, meaning both from Entek Tüpraş on-site power plants, zero-carbon electricity production posted 21% year-over-year growth and reached 1.27 TW-hours. This progress aligns with our ongoing portfolio expansion.
Additionally, the recent acquisition in Romania, with solar power license up to 214 MW, was completed, further strengthening growth trajectory in the zero-carbon electricity business line. Prudent cash management remained a key focus throughout the year, including the fourth quarter of 2024. We closed the year with $2.1 billion in cash, following the repayment of $700 million in Eurobond and $300 million in dividend payments. This high level of liquidity reflects our strong financial and operational discipline. Today, we announced our 2025 dividend, totaling TRY 29.3 billion, to be distributed in two installments. With this latest payout, the total dividend payments over the past three years amounted to $3.3 billion in a whopping combined dividend yield over 45%. As you know, we cover this section in two main components: developments in the global oil market and developments in the Turkish market.
Let's start with the global oil market. Over the last five years, crack margins have experienced both significant highs and lows. The onset of the COVID-19 pandemic in 2020 led to reduced mobility, resulting in the lowest crack margins recorded. As the economy started recovering, the Russia-Ukraine war created a major supply disruption. The market responded accordingly to the readjustment of trading routes, reaching peak in 2022 and 2023. We have consistently emphasized that these two years, along with the pandemic period, were exceptional cases rather than a part of a broader trend. 2024 was a year of normalization, which, despite ongoing geopolitical uncertainties, demand remained stronger than the pre-COVID era. As a result, crack margins settled at a lower level than 2023, but still above pre-pandemic levels in 2019.
On the supply side, part of OPEC+ market share has been replaced by non-OPEC+ production, mitigating the impact of OPEC+ supply cuts on Brent crude prices. The market has observed short-term price increases in Brent, which tend to normalize quickly as non-OPEC+ producers ramp up supply. Now, taking a look at the bottom row, the Turkish market. Over the last 12 months, inflation was dropping down to 42%. CBRT made consecutive rate cut decisions starting at year-end and lowering the policy rate down to 45% from 50%, in line with the declining inflation, still preserving a positive real interest window. The central bank's February 2025 inflation report increased its forecast on 2025 year-end inflation from 21%- 24%. Regarding demand, Turkey's consumption of oil products is up by 4% annually.
Notably, there has been a substantial increase in gasoline demand by 21% year-over-year during the first 11 months, followed by a 6% increase in jet fuel demand. Now, let's take a look at the cracks for the fourth quarter of 2024 in comparison to last year's and five years' average on this page. In the fourth quarter, diesel cracks averaged at $16.1 per barrel, lower year-on-year due to the high base of last year. Global slowdown in industrial activity, which was significantly influenced by the economic slowdown in China, created a downward pressure on diesel cracks. Due to the maintenances in the fourth quarter, the capacity utilizations were lower. Hence, the cracks increased slightly quarter-on-quarter. Nowadays, due to restrictions in heavy crude availability, diesel cracks have been improving and reached $20 per barrel in the first half of February.
Jet fuel cracks averaged at $13.3 per barrel in the fourth quarter, decreased year-on-year due to the high base of last year, similar to diesel. Jet fuel cracks are also positively affected from restrictions on crude oil availability and reached $17 per barrel in the first half of February. Gasoline cracks averaged at $11.9 per barrel in the fourth quarter of 2024, parallel year-over-year supported by the strong demand in Europe despite the high inventory levels. Gasoline cracks also improved and reached $15 per barrel in the first half of February. High-sulfur fuel oil cracks reached around $7.9 per barrel in the fourth quarter, higher quarter-on-quarter due to the low production, low exports resulting from maintenances, and low fuel oil inventories. HSFO cracks reached -$6 per barrel in the first half of February.
Moving over to the crude price differentials. Differentials widened in the fourth quarter. While OPEC+ extended its production cuts until April, the impact was partially offset by increased output from non-OPEC+ producers. The latest sanctions imposed on Russia may lead to a narrowing of these differentials, at least in the early months of 2025. This effect is expected to start in February, as existing trades will remain valid until February 26. Additionally, announced OSPs for February and March indicate this trend. With the latest sanctions imposed, we have stopped buying oil and will receive the final cargoes during February. As usual, if differentials narrow too much as a result of these new sanctions, cracks will remain strong, as observed so far in the first half of February. Now, starting with the production volume, let's check Tüpraş operations.
Our production in the fourth quarter of 2024 was 6.7 million tons, affected by the low season. The annual production stood at 26.7 million tons. The completion of major maintenances in the first half of the year paved the way for enhanced production in the latter half. For the crude distillation, we managed to achieve a capacity utilization of 84.2%, and the utilization rate for processing other feedstock stood at 9.2%. Our system-wide capacity utilization rate was 93.4% in the fourth quarter. As a result, the overall annual utilization rate was brought to 85% for crude distillation and 7.2% for the other feedstocks, with a combined total utilization of 92.6%, higher than our guidance. Moving on to the sales, let's start with the chart on the left-hand side.
In the fourth quarter, our domestic and international sales were respectively 6.2 million tons and 1.3 million tons, summing up to 7.5 million tons in total. Our domestic sales are slightly higher than last year by 3%, driven by a 24% increase in domestic gasoline sales. The sales in the fourth quarter of 2024 were down by 7% year-on-year due to the low season. Now, let's move on to the electricity operations. This slide summarizes electricity production and sales activities of Entek and Tüpraş in 2024. In 2024, 56% of the electricity generated was from hydropower, 28% was from wind power, and the rest was CCGT and solar. Out of the 1.3 GW -hours zero-carbon electricity produced, around 30% was sold to feed-in tariff, which is at $73 per MW-hour. The rest was sold to spot market.
With the integration of the Kınık wind power plant, the share of electricity generated from wind increased from 18%- 28%. Now, let's move to the financials. Taking a look at the P&L items in detail for the fourth quarter of 2024, within the IAS 29 standards, all financials that are provided in this presentation and in our quarterly financials report is calculated with inflationary adjustments. Additionally, the financial figures for the fourth quarter of 2023 have been scaled up by a factor of 1.44 in accordance with the December 2024 CPI in order to reflect the purchasing power of the current quarter. This adjustment is the main reason of year-over-year dropping figures in all lines. Revenues came in at TRY 173 billion, equating to almost $4.9 billion in the fourth quarter, down by 35% to last year due to weakening crack margins.
Cost of goods sold stood at TRY 162 billion, affected by narrow differentials. Gross profit was TRY 11 billion, mainly with weak crack margins and narrow differentials. Operational expenses were down by 40% due to the scaled-up figure of the last year. Loss from other operations is affected by the FX gain/ loss from trade payables. Last year, Turkish lira depreciated by approximately 57%, resulting in FX loss on trade payables. This year, Turkish lira depreciation was much less, creating a positive impact on this item. Income and loss from equity pickup was recorded at TRY 569 million, coming from OPEC. In the fourth quarter of 2024, we recorded a financial income of TRY 1.2 billion, originating from net interest income. The monetary loss of TRY 1.2 billion is much lower than the previous quarters, as the gap between inflation and interest rates is closed.
As a conclusion of this, we have recorded TRY 6.8 billion of profit before tax in the fourth quarter of 2024. Below PBT, we have recorded TRY 2.9 billion tax expense item, as the reversal of deferred tax creates a negative impact on the tax line item. As a result, we have recorded TRY 3.9 billion in net income in the fourth quarter. Now, for the EBITDA, our reported EBITDA was materialized at TRY 8.9 billion. We recorded TRY 1.4 billion negative inventory effect. Brent prices decreased around 7% quarter-on-quarter. Although our hedging mechanism covers almost 80% of our inventory, we still bear some effects. Our EBITDA CCS was materialized at TRY 10.2 billion. Two billion TRY of this EBITDA was recorded from our electricity operations. Now, let us take a look at the profit before tax bridge.
As you can see from the waterfall chart, the dominant negative impact comes from crack margins due to material drop from the last year's high base in the fourth quarter. TRY 600 million negative impact comes from narrow differentials compared to last year. Significant net interest income and lower FX losses had a positive impact on our financial results for this quarter at TRY 4 billion. Inventory loss versus high inventory gain resulted in a negative TRY 7.6 billion impact. TRY 2.7 billion comes from the change in the monetary loss item, as monetary loss is lower this quarter based on the decreased gap between inflation and interest rates. All in all, 2024 fourth quarter profit before tax is materialized at TRY 6.7 billion. Now, let's take a look at the financial highlights.
With ongoing deleveraging, our net debt to EBITDA materialized at negative 1.1 times as of the end of the fourth quarter. The share of long-term debt increased from 15%- 52%, reflecting an improved liquidity management and greater financial stability. Cash and cash equivalents and financial liabilities at the end of the fourth quarter stood at TRY 74 billion and TRY 19 billion, respectively. We ended the quarter with TRY 55 billion of net cash, preserving our strong cash position. Our working capital requirements remained negative as a result of ongoing effective cash cycle management. Now, looking at the maintenance calendar for 2025, we have scheduled vacuum and desulfurizer maintenance in Izmit, which was deferred from 2024. Similarly, the crude oil and vacuum maintenance in Batman has also been postponed from the previous year. There are no planned maintenance activities in Kırıkkale for 2025.
Overall, there are no major maintenance operations this year that would significantly impact our production capacity. On this slide, we have our expectations for 2025. Looking into the details, we are reintroducing our net refining margin guidance in 2025 after reformulating it and stripping it of inflationary items. With this, we expect $5-$6 per barrel net refining margin in 2025, as the cracks will continue to normalize and we may experience narrow differentials due to volatile geopolitical conjuncture. Regarding production and sales figures, we expect approximately 26 million tons of production and approximately 30 million tons of sales. We expect capacity utilization to be within a range of 90%-95%. Our consolidated CapEx target for 2025 is set around $600 million. On this slide, we would like to sum up some key figures for the fourth quarter and compare them with our 2024 guidance.
We had a weighted average crack margin of $11.2 per barrel in 2024, slightly below our full-year guidance of $12 per barrel. Our annual capacity utilization rate was 92.6%, which is slightly above our guidance range of 85%-90%. Our annual production and sales reached respectively 26.7 million tons and 30.4 million tons, both above our guidance. We have spent $376 million in CapEx in parallel with our guidance. This slide concludes our presentation, and we can now proceed with the Q&A session.
The first question comes from V illari Giuseppe with Morgan Stanley. Please go ahead.
Hi, good afternoon. Thank you for the presentation and for taking our question. We have two, if I may. Both of them are about the outlook for 2025. The first one is about CapEx. So we saw an increase in the CapEx guidance, and that is due to the postponement of the turnarounds, I guess. And how much of that is due to the postponement of the CapEx for 2024, and how much is due to other factors? And then the second question is about the outlook for refining margins. Is the net refinery margin figure that you provide now comparable with the guidance from for 2024? And what are the main factors that you believe are going to drive margins for 2025? Thank you.
Thank you for your questions. It's Dogan speaking. Let me start with the CapEx and give you a bit of color on the refining margins, but Levent will go into more detail afterwards.
The CapEx figure we have here is always a consolidation of the need for Tüpraş, as well as our subsidiaries, including the shipping company Ditaş and the energy company Entek. We have recently announced a project of Entek in Romania, taking over the license rights of a company, i.e., an acquisition of a company with the rights. But during this year, there will start the phase of spending on site under this license. So a big portion of our CapEx, which is slightly over $150 million, is going to go for Entek investments. The second largest in our subsidiaries is Ditaş's expenses for this year, which might be considered as one-offs. Ditaş is considering getting a couple of tankers to its fleet to support our operations in Turkish seas and out of Turkish seas, which makes around $120 million.
So all in all, when you sum up these two figures, you're ending with more or less similar amounts that you would normally get from Tüpraş, which is slightly over $400 million. So that $400 million, which can be attributable to, I mean, almost $400 million, which can be attributable to Tüpraş's own CapEx, has not a major impact coming from the postponements of maintenances from last year. It's pretty much in line with what we have spent previously, mostly on energy efficiency projects, revamps, and new business areas, including sustainable refining. For your second question regarding the refinery margin calculation as of this year, we've stripped the effect of inflationary accounting adjustments from this year's calculation, which makes it more similar to what we had announced before inflation accounting came to our lives two years ago.
Therefore, you can compare it with 2023, but it's very difficult to compare it with last year because we haven't provided a refining margin benchmark last year because of unknown effects of inflationary accounting to us. This year, we found a way to do it without inflationary accounting figures, which makes it on par with 2023 rather than 2024. Levent might have a further say on that.
Well, in terms of the spirit of the calculations of our previous net refining margin, which we were providing before 2024, it is in spirit same. However, there is a key difference. The current net refining margin calculation is more accurate compared to the previous one because it is assuming sales rather than production in terms of the calculation of the net refining margin. So it should be closer to our actual dollar-based EBITDA for the current period.
As a reminder, we have been telling you this for quite some time. Inflationary accounting adjustments have very limited impact on our current EBITDA, whereas we are adjusting the previous years' EBITDA with the purchasing power adjustment. But current EBITDA has very limited impact. But with this tool now we are providing to the market, it is even more accurate compared to the previous net refining margin calculation.
That is very helpful. Thank you very much. Just to confirm, so the current calculation for refining margins, I mean, the new one, is based on sales rather than production, right?
Yes, correct.
Okay, perfect. Very helpful. Thank you very much.
Thank you.
Ladies and gentlemen, there are no further questions at this time. I'm now turning the conference over to management for any closing comments. Thank you.
Thank you once again for joining us this evening for our final call 2024. Before we conclude, I'd like to share a few closing remarks. We closed the year on a strong note with solid capacity utilization, production, and sales volumes exceeding our guidance, reflecting our operational expertise and efficiency. Despite market fluctuations, we successfully navigated the year with strong cash generation. After repaying our Eurobond and strategically managing our funding portfolio, we ended the year with a robust cash position of TRY 2.1 billion . This achievement underscores our commitment to financial discipline and long-term value creation.
Today, we are pleased to announce a dividend payment of TRY 29.3 billion for 2025, which will be distributed in two installments. Combined with last two years' payments, this indicates a combined dividend yield close to 50%, strongest in Borsa Istanbul and our regional peers. This reflects both our solid operational profitability, financial standing, and prudent management, delivering value while maintaining a sustainable growth trajectory.
2024 was characterized by fluctuating prices driven by supply, geopolitical uncertainties, weakened global economic activity. While demand showed resilience, OPEC+ production decisions influenced market dynamics. Looking ahead, we remain cautiously optimistic about 2025. While the year began with volatility due to geopolitical tensions, sanctions on Russia, and shifts in global trade policies, we're confident in our ability to adapt. Our approach remains focused on maintaining operational efficiency, capitalizing on market shifts, and leveraging our strengths to navigate the evolving energy landscape. We appreciate your time and continue trust in our company. Thank you all for listening to us today and wish you a great day ahead.