EBITDA

EBITDA Formation, RUB million
Indicator 2018 2017 Change, %
Net profit for the period 225,413 191,805 17.5
Adjustments:
income tax expenses 52,298 50,362 3.8
depreciation and amortisation 178,610 152,637 17.0
result from oil sales to China −439 419
net financial expenses/(income) 21,304 15,632 36.3
share of the profit of subsidiaries and jointly run companies −10,231 −15,847 −35.4
other incomes/expenses including −33,519 13,686
evaluation of the existing share in NCSP (Omirico Limited) to the fair value at the date of acquisition of the controlling stake and income from disposal of subsidiaries −25,371
EBITDA Excluding crude oil sale and purchase transactions between Transneft and Rosneft and China National United Oil Corporation 433,436 408,694 6.1

Earnings before interest, tax, depreciation and amortisation (EBITDA) is an indicator that reveals the efficiency of the Group’s activities, including the Group’s ability to finance capital costs, acquire businesses and make other investments, as well as its ability to raise and repay loans. For investors, analysts and rating agencies EBITDA normally serves as the ground to evaluate and forecast oil and gas businesses’ cost and efficiency. This indicator should not be viewed separately, as an alternative to earnings for a given period, earnings from core activity or any other indicator showing the Group’s efficiency and reflected in the consolidated financial statement by IFRS.

In 2018, EBITDA growth compared to 2017 was due to increased revenues from transportation of oil and petroleum products, oil sales for export, as well as the provision of stevedoring services, additional port services and fleet services (due to the acquisition of controlling stakes in NCSP Group and NFOT in September 2018).