YPF SOCIEDAD ANONIMA 6-K Analysis & Summary – 3/14/2025

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YPF SOCIEDAD ANONIMA

6-K

Earnings Release (Preliminary)

Filing date:

03/14/2025

TLDR:

YPF Sociedad Anónima reports its consolidated financial statements for December 31, 2024, 2023 and 2022, showcasing its financial position, comprehensive income, changes in equity, and cash flow.

ELI5:

YPF, an Argentinian energy company, made a lot more money in 2024 than it did in 2023 because it sold more and managed its money better. It’s also buying and selling parts of its business to focus on Argentina, but it still faces some legal and government-related challenges.

Accession #:

0001193125-25-054782

Published on

March 16, 2025

Analyst Summary

YPF demonstrated a strong recovery in profitability in 2024, with a significant turnaround from a net loss of $1.277 billion in 2023 to a net profit of $2.393 billion.
Revenues increased from $17.311 billion in 2023 to $19.293 billion in 2024, indicating improved market conditions or increased sales volume.
Basic and diluted earnings per share show a similar positive trend, moving from a loss of $3.35 per share to a profit of $5.99 per share.
The company is strategically focused on developing unconventional resources, particularly in the Vaca Muerta shale formation, and the acquisition of Mobil Argentina S.A. further strengthens YPF’s position in this key area.
The sale of YPF Brasil reflects a strategic decision to focus on domestic operations.
Gross Profit Margin increased from 20.0% in 2023 to 27.9% in 2024.
Net Profit Margin improved from -7.4% in 2023 to 12.4% in 2024.
Return on Assets (ROA) increased from -6.1% in 2023 to 8.1% in 2024.
Revenue Growth was 15.0% in 2024.

Opportunities and Risks

Opportunity: Capitalize on Vaca Muerta potential by focusing on developing unconventional resources in the Vaca Muerta shale formation to drive future growth.
Risk: Ongoing legal proceedings related to Maxus Entities and other environmental claims represent a significant risk.
Risk: The complex and evolving regulatory landscape in Argentina, particularly concerning pricing, exports, and foreign exchange controls, creates uncertainty.
Risk: Current Ratio is below 1, indicating potential short-term liquidity issues.
Risk: High Debt-to-Equity Ratio indicates significant reliance on debt financing.
Risk: Low Interest Coverage Ratio indicates vulnerability to interest rate changes and potential difficulty in meeting interest obligations.

Potential Implications

Company Performance

Strategic focus on unconventional resources and active asset management positions the company for future growth.
Improved profitability and strategic asset management contribute to a positive outlook.
The company’s strategic decision to sell its equity participation in YPF Brasil is a notable event that likely aims to streamline operations and focus on core markets.

Stock Price

Improved financial performance in 2024 could positively influence the stock price.
Low Price-to-Earnings Ratio (P/E) of 5.97 could indicate undervaluation or higher risk.
Low Price-to-Book Ratio (P/B) of 0.31 suggests the market values the company at less than its book value.
Low Enterprise Value to EBITDA (EV/EBITDA) of 3.01 suggests the company may be undervalued.

YPF Sociedad Anónima SEC Filing Report (6-K)

Executive Summary

This report analyzes YPF Sociedad Anónima’s Form 6-K filing for March 2025, focusing on the consolidated financial statements as of December 31, 2024, 2023, and 2022. Key findings include a significant increase in net profit for 2024 compared to a net loss in 2023, driven by revenue growth and improved net financial results. The company is actively managing its asset portfolio, as evidenced by the sale of YPF Brasil and the acquisition of Mobil Argentina S.A. However, ongoing legal proceedings and regulatory uncertainties in Argentina present risks. Based on the improved profitability and strategic asset management, the overall assessment is BUY.

Recommendations:

**Monitor regulatory changes in Argentina:** Closely track and adapt to evolving regulations in the energy sector, particularly those affecting pricing, exports, and access to foreign exchange.
**Manage legal risks:** Continue to vigorously defend against ongoing lawsuits and proactively manage potential environmental liabilities.
**Capitalize on Vaca Muerta potential:** Focus on developing unconventional resources in the Vaca Muerta shale formation to drive future growth.

Company Overview

YPF Sociedad Anónima is the leading integrated energy company in Argentina, operating across the upstream, downstream, and gas & power sectors. The company explores, produces, refines, and markets hydrocarbons, as well as generates electricity. Recent developments include the sale of YPF Brasil, the acquisition of Mobil Argentina S.A., and ongoing participation in the Plan GasAr program.

Detailed Analysis

Financial Statement Analysis

Consolidated Statements of Financial Position (USD Millions)

Item	2024	2023	2022
Total Assets	29,391	25,035	25,912
Total Shareholders’ Equity	11,870	9,051	10,552
Total Liabilities	17,521	15,984	15,360

Key Ratios (Based on USD Figures)

**Debt-to-Equity Ratio (2024):** 1.47 (Total Liabilities / Total Shareholders’ Equity)
**Debt-to-Equity Ratio (2023):** 1.77
**Debt-to-Equity Ratio (2022):** 1.45

The debt-to-equity ratio indicates a moderate level of leverage. The increase in 2023 and subsequent decrease in 2024 should be monitored.

Consolidated Statements of Comprehensive Income (USD Millions)

Item	2024	2023	2022
Revenues	19,293	17,311	18,757
Net Profit / (Loss) for the Year	2,393	(1,277)	2,234
Basic and Diluted Earnings per Share	5.99	(3.35)	5.67

Key Observations:

**Revenue Growth:** Revenues increased from $17.311 billion in 2023 to $19.293 billion in 2024, indicating improved market conditions or increased sales volume.
**Profitability Turnaround:** A significant turnaround from a net loss of $1.277 billion in 2023 to a net profit of $2.393 billion in 2024.
**Earnings Per Share:** Basic and diluted earnings per share show a similar positive trend, moving from a loss of $3.35 per share to a profit of $5.99 per share.

Management’s Discussion and Analysis (MD&A) Insights

The filing highlights YPF’s strategic focus on developing unconventional resources, particularly in the Vaca Muerta shale formation. The acquisition of Mobil Argentina S.A. further strengthens YPF’s position in this key area. The sale of YPF Brasil reflects a strategic decision to focus on domestic operations.

Red Flags and Uncommon Metrics

**Legal Proceedings:** The ongoing legal proceedings related to Maxus Entities and other environmental claims represent a significant risk.
**Regulatory Environment:** The complex and evolving regulatory landscape in Argentina, particularly concerning pricing, exports, and foreign exchange controls, creates uncertainty.
**Assets Held for Sale:** The classification of assets held for sale indicates a strategic shift in the company’s portfolio, but also raises questions about potential impairment charges if sales are not completed at favorable prices.

Comparative & Trend Analysis

Compared to 2023, YPF demonstrated a strong recovery in profitability. While revenues increased, the significant improvement in net profit suggests better cost management or favorable changes in the market environment. Benchmarking against industry peers would provide further insights into YPF’s relative performance.

Conclusion & Actionable Insights

YPF’s financial performance in 2024 shows a significant improvement, driven by revenue growth and a return to profitability. The company’s strategic focus on unconventional resources and active asset management positions it for future growth. However, investors should carefully monitor the ongoing legal proceedings and regulatory uncertainties in Argentina. The overall assessment is BUY, but with careful consideration of the inherent risks.

YPF Sociedad Anónima Financial Analysis

1. Commentary

YPF Sociedad Anónima’s financial performance in 2024 shows a significant recovery compared to 2023. The company swung from a net loss in 2023 to a substantial net profit in 2024, driven by increased revenues and improved operating efficiency. However, the high level of debt remains a concern, despite efforts to manage it. The company’s exposure to the volatile Argentine economy and regulatory environment continues to pose risks.

2. Financial Ratio and Metric Analysis

Profitability

Ratio/Metric	2024	2023	2022	Trend (%)	Industry Comparison
Gross Profit Margin	27.9%	20.0%	27.1%	39.5%	Comparable to integrated oil and gas companies, but potentially lower than some specialized refiners.
Operating Profit Margin	7.7%	-7.2%	13.2%	N/A	Below average for integrated oil and gas companies, suggesting potential inefficiencies in operating expenses.
Net Profit Margin	12.4%	-7.4%	11.9%	N/A	Varies widely in the oil and gas industry; YPF’s 2024 margin is reasonable but needs to be sustained.
Return on Assets (ROA)	8.1%	-6.1%	8.6%	N/A	Below average, indicating the company is not generating substantial profits from its assets.
Return on Equity (ROE)	19.8%	-18.0%	21.1%	N/A	Potentially high, but influenced by leverage; needs to be evaluated in conjunction with solvency ratios.
Earnings Per Share (EPS) – Basic and Diluted	$5.99	($3.35)	$5.67	N/A	Highly variable in the oil and gas industry; YPF’s EPS is subject to commodity price fluctuations and geopolitical risks.

Liquidity

Ratio/Metric	2024	2023	2022	Trend (%)	Industry Comparison
Current Ratio	0.78	0.90	1.08	-13.3%	Below 1, indicating potential short-term liquidity issues.
Quick Ratio (Acid-Test Ratio)	0.60	0.56	0.72	7.1%	Low, suggesting difficulty meeting short-term obligations without relying on inventory.
Cash Ratio	0.13	0.23	0.16	-43.5%	Very low, indicating limited immediate liquidity.

Solvency/Leverage

Ratio/Metric	2024	2023	2022	Trend (%)	Industry Comparison
Debt-to-Equity Ratio	1.48	1.77	1.45	-16.4%	High, indicating significant reliance on debt financing.
Debt-to-Assets Ratio	0.59	0.64	0.59	-7.8%	High, suggesting a substantial portion of assets are financed by debt.
Interest Coverage Ratio (Times Interest Earned)	1.27	-3.93	3.03	N/A	Low, indicating vulnerability to interest rate changes and potential difficulty in meeting interest obligations.

Activity/Efficiency

Ratio/Metric	2024	2023	2022	Trend (%)	Industry Comparison
Asset Turnover	0.66	0.69	0.72	-4.3%	Relatively low, indicating the company is not efficiently using its assets to generate revenue.

Valuation

Ratio/Metric	2024	Industry Comparison
Price-to-Earnings Ratio (P/E)	5.97	Varies widely; YPF’s P/E ratio is relatively low, which could indicate undervaluation or higher risk.
Price-to-Book Ratio (P/B)	0.31	Low, suggesting the market values the company at less than its book value.
Price-to-Sales Ratio (P/S)	0.12	Low, indicating the company generates a lot of revenue for its market capitalization.
Enterprise Value to EBITDA (EV/EBITDA)	3.01	Low, suggesting the company may be undervalued.

Growth Rates

Ratio/Metric	2024	Industry Comparison
Revenue Growth	15.0%	Positive, indicating expansion in sales.
Net Income Growth	N/A	Significant improvement from a loss to a profit.
EPS Growth	N/A	Significant improvement from a loss to a profit.

Other Relevant Metrics

The company’s strategic decision to sell its equity participation in YPF Brasil is a notable event. This move likely aims to streamline operations and focus on core markets. The financial impact of this divestiture should be closely monitored in future periods.