First Berlin Equity Research has published a research update on Deutsche Rohstoff AG (ISIN: DE000A0XYG76). Analyst Simon Scholes reiterated his BUY rating and decreased the price target from EUR 43.00 to EUR 36.00.

Preliminary Q2/22 results showed an 83.4% increase in EBITDA to €36.8m (Q2/21: €18.6m) while the H1/22 number was up 88.6% at €64.0m (H1/21: €39.9m).The jump in profits was occasioned by higher volume, higher commodity pricing and a shift in the volume mix towards oil, which is more profitable than gas. The current futures strip indicates an 8.3% decline in the oil price in H2/22 versus H1/22 and a 16.5% drop in 2023 vs. 2022. However, we expect EBITDA to climb further during the second half of the year and fall by only 2.2% in 2023 due mainly to better realised pricing as a result of lower hedging cover. The dip in both the oil and gas futures curves since our most recent note of 9 June causes us to reduce our EBITDA forecast for 2022 by 6.3% to €131.6m and for 2023 by 13.6% to €128.7m. But both numbers are still above the higher oil/gas price scenario guidance given by management on 25 April. We maintain our Buy recommendation but lower the price target from €43.00 to €36.00.