Austrian energy company OMV reported a €1.94 billion adjusted net income for the 2025 fiscal year, outperforming market expectations and highlighting a significant pivot in its business strategy. The chemicals division, which saw its operating result jump 71% to €784 million, has become the primary driver of the company’s profitability, while the traditional energy segment experienced a 29% decline in operating results to €2.7 billion.

Chemicals Outperform Energy Amid Strategic Realignment

The Chemicals & Materials unit’s performance was fueled by the reorganization of the Borealis group and improved margins in the olefins business. European steam crackers operated by OMV and Borealis operated at 82% capacity, a rate 10 percentage points above the European industry average. This contrast with the energy segment’s struggles, which were driven by lower commodity prices and reduced sales volumes, has forced OMV to reorient its long-term strategy.

OMV’s executive board has proposed a total dividend of €4.40 per share for 2025, the fourth consecutive increase. The regular dividend has grown by over 30% in the past four years. The final decision on this payout rests with the Annual General Meeting scheduled for May 27, 2026.

Dividend Policy Tied to Chemicals Growth

A key development in OMV’s strategy is a new dividend policy set to begin in 2026. From that year onward, dividends will be calculated as 50% of the dividends received from Borealis Group International (BGI) plus 20 to 30% of the group’s operating cash flow. This change explicitly ties future shareholder returns to the chemicals business, signaling where OMV’s long-term growth is focused.

The formation of Borealis Group International (BGI) with ADNOC is expected to be completed in the first quarter of 2026. This merger will create the world’s fourth-largest polyolefins producer, and OMV anticipates receiving annual dividends of at least $1 billion from this stake starting in 2026.

OMV is also advancing two major projects. The Neptun Deep gas project is slated to begin operations in 2027. In addition, a partnership with Masdar will develop a 140-megawatt green hydrogen facility, supported by €123 million in funding. The company has also significantly increased its sales of sustainable aviation fuels, rising from 4,000 tonnes in 2024 to 60,000 tonnes in 2025.

Future Growth and Investment Plans

CEO Alfred Stern has emphasized the company’s active pursuit of acquisition targets, particularly in the gas sector. The group’s efficiency program has already contributed over €350 million to operating cash flow since its inception.

For 2026, OMV is basing its planning on an average Brent crude price of approximately $65 per barrel. Organic investments are projected at €3.2 billion, with production expected to remain just below 300,000 barrels of oil equivalent per day. The company plans average annual investments of €2.8 billion through 2030, with a long-term target of achieving an adjusted operating result exceeding €6.5 billion.

Despite the energy segment’s challenges, OMV’s balance sheet remains strong, with net debt standing at €3.6 billion and a gearing ratio of only 14 percent. A trading update for the first quarter of 2026 will be published on April 9, providing early indicators of the year’s stability and the progress of the firm’s transformation initiatives.

The shift in focus toward the chemicals division and the new dividend policy reflect a broader industry trend where energy companies are diversifying into chemicals and renewable energy to offset the declining profitability of traditional oil and gas operations. Analysts suggest that OMV’s strategic pivot could influence the broader European energy sector as more firms seek to balance their portfolios with higher-margin chemical and renewable assets.