The different segments in which the Group is organized take into consideration the different activities from which the Group obtains income and incurs expenses. The aforementioned organizational structure is based on the way in which the highest decision-making authority analyzes the main financial and operating magnitudes for making decisions about resource allocation and performance assessment also considering the Group’s business strategy.
| • | Upstream |
The Upstream segment carries out all activities relating to the exploration, development and production of oil and natural gas.
Revenue is generated from (i) the sale of produced oil to the Downstream segment and, marginally, from its sale to third parties; (ii) the sale of produced gas to the Gas and Power segment.
| • | Gas and Power |
On March 15, 2016, the Gas and Power Executive Vice-presidency was created, and during the current fiscal year, the complete scope of management of this new business unit was determined.
The Gas and Power segment generates its revenue from the development of activities relating to: (i) the natural gas commercialization to third parties and the Downstream segment, (ii) the commercial and technical operation of LNG regasification terminals in Bahía Blanca and Escobar, by hiring two regasification vessels, (iii) the natural gas distribution, and (iv) the generation of conventional and renewable electricity.
In addition to the proceeds derived from the sale of natural gas to third parties and the intersegment, which is then recognized as a “purchase” to the Upstream segment, and including since 2017, the Stimulus Plan for Surplus Natural Gas Injection, Gas and Power accrues a fee in its favor with the Upstream segment to carry out such commercialization.
| • | Downstream |
The Downstream segment develops activities relating to: (i) oil refining and petrochemical production, (ii) commercialization of refined and petrochemical products obtained from such processes, (iii) logistics related to the transportation of oil and gas to refineries and the transportation and distribution of refined and petrochemical products to be marketed in the different sales channels.
It obtains its income from the marketing mentioned in item (ii) above, which is developed through the Retail, Industry, Agro, LPG, Chemicals and Lubricants and Specialties businesses.
It incurs in all expenses relating to the aforementioned activities, including the purchase of oil from the Upstream segment and third parties and the natural gas to be consumed in the refinery and petrochemical industrial complexes from the Gas and Power segment.
| • | Central Administration and Others |
It covers other activities, not falling into the aforementioned categories, mainly including corporate administrative expenses and assets and construction activities.
Sales between business segments were made at internal transfer prices established by the Group, which generally seek to approximate market prices.
Operating profit and assets for each segment have been determined after consolidation adjustments.
As required by IFRS 8, comparative information has been given retroactive effect by the creation of the new segment.
| Upstream | Gas and Power | Downstream | Central Administration and Others |
Consolidation Adjustments(1) |
Total | |||||||||||||||||||
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For the year ended December 31, 2017 |
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Revenues from sales |
739 | 56,805 | 195,321 | 2,534 | (2,586 | ) | 252,813 | |||||||||||||||||
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Revenues from intersegment sales |
115,955 | 4,075 | 988 | 7,133 | (128,151 | ) | — | |||||||||||||||||
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Revenues |
116,694 | 60,880 | 196,309 | 9,667 | (130,737 | ) | 252,813 | |||||||||||||||||
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Operating profit / (loss) |
3,877 | 3,259 | 15,813 | (4,400 | ) | (2,476 | ) | 16,073 | ||||||||||||||||
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Income / (loss) from equity interests in associates and joint ventures |
— | 634 | 794 | — | — | 1,428 | ||||||||||||||||||
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Depreciation of property, plant and equipment |
45,279 | (3) | 290 | 6,926 | 1,017 | — | 53,512 | |||||||||||||||||
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Recovery of property, plant and equipment and intangible assets(2) |
5,032 | — | — | — | — | 5,032 | ||||||||||||||||||
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Acquisition of property, plant and equipment |
39,411 | 3,867 | 8,179 | 1,639 | — | 53,096 | ||||||||||||||||||
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Assets |
251,525 | 45,395 | 158,800 | 53,934 | (3,936 | ) | 505,718 | |||||||||||||||||
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For the year ended December 31, 2016 |
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Revenues from sales |
18,745 | 26,514 | 162,538 | 2,303 | — | 210,100 | ||||||||||||||||||
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Revenues from intersegment sales |
95,398 | 3,212 | 925 | 7,447 | (106,982 | ) | — | |||||||||||||||||
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Revenues |
114,143 | 29,726 | 163,463 | 9,750 | (106,982 | ) | 210,100 | |||||||||||||||||
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Operating profit / (loss) |
(26,845 | ) | 2,008 | 3,093 | (1,615 | ) | (887 | ) | (24,246 | ) | ||||||||||||||
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Income / (loss) from equity interests in associates and joint ventures |
(1 | ) | 302 | 287 | — | — | 588 | |||||||||||||||||
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Depreciation of property, plant and equipment |
38,125 | 290 | 5,507 | 830 | — | 44,752 | ||||||||||||||||||
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Impairment of property, plant and equipment and intangible assets(2) |
34,943 | (3) | — | — | — | — | 34,943 | |||||||||||||||||
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Acquisition of property, plant and equipment |
51,396 | 2,134 | 9,839 | 1,679 | — | 65,048 | ||||||||||||||||||
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Assets |
236,173 | 25,866 | 125,536 | 34,739 | (1,175 | ) | 421,139 | |||||||||||||||||
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For the year ended December 31, 2015 |
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Revenues from sales |
16,044 | 14,003 | 124,959 | 1,130 | — | 156,136 | ||||||||||||||||||
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Revenues from intersegment sales |
64,243 | 2,184 | 807 | 6,182 | (73,416 | ) | — | |||||||||||||||||
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Revenues |
80,287 | 16,187 | 125,766 | 7,312 | (73,416 | ) | 156,136 | |||||||||||||||||
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Operating profit / (loss) |
7,535 | 1,498 | 6,948 | (2,331 | ) | 2,938 | 16,588 | |||||||||||||||||
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Income / (loss) from equity interests in associates and joint ventures |
— | 267 | 51 | — | — | 318 | ||||||||||||||||||
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Depreciation of property, plant and equipment |
23,075 | 255 | 2,913 | 442 | — | 26,685 | ||||||||||||||||||
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Impairment of property, plant and equipment and intangible assets(2) |
2,535 | — | — | — | — | 2,535 | ||||||||||||||||||
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Acquisition of property, plant and equipment |
48,598 | 469 | 8,874 | 1,939 | — | 59,880 | ||||||||||||||||||
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Assets |
223,035 | 13,659 | 100,146 | 26,708 | (95 | ) | 363,453 | |||||||||||||||||
| (1) | Corresponds to the elimination of income among segments of the YPF Group. |
| (2) | See Notes 2.c) and 8. |
| (3) | Includes depreciation of charges for impairment of property, plant and equipment. |
The distribution of revenues by geographic area, according to the markets for which they are intended, for the years ended on December 31, 2017, 2016 and 2015, and property, plant and equipment by geographic area as of December 31, 2017, 2016 and 2015 are as follows:
| Revenues | Property, plant and equipment | |||||||||||||||||||||||
| 2017 | 2016 | 2015 | 2017 | 2016 | 2015 | |||||||||||||||||||
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Argentina |
230,728 | 193,707 | 143,851 | 353,868 | 307,350 | 269,914 | ||||||||||||||||||
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Mercosur and associated countries |
8,694 | 7,964 | 6,302 | 575 | 664 | 553 | ||||||||||||||||||
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Rest of the world |
8,785 | 6,142 | 4,175 | — | — | 438 | ||||||||||||||||||
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Europe |
4,606 | 2,287 | 1,808 | — | — | — | ||||||||||||||||||
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Total |
252,813 | 210,100 | 156,136 | 354,443 | 308,014 | 270,905 | ||||||||||||||||||
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Intangible assets are mainly geographically located in Argentina.
As of December 31, 2017, no foreign client represents 10% or more of the Group’s revenue from its ordinary activities.