TotalEnergies SE announced a first-quarter profit decline that was less than anticipated, thanks to a resilient oil market that mitigated the impact of reduced gas prices.
Like other energy firms, the French conglomerate experienced the repercussions of Europe’s sluggish gas market, influenced by a mild winter dampening heating demand.
However, support for crude prices stemmed from supply restrictions by OPEC+ and ongoing conflicts in the Middle East, providing a buffer for major oil companies’ earnings.
According to Bloomberg News, the earnings reflect “a context of sustained oil prices and refining margins but softening gas prices,” TotalEnergies Chief Executive Officer Patrick Pouyanne said in a statement.
Adjusted net income was $5.11 billion in the period, down from $6.54 billion a year earlier, the company said on Friday. Analysts had expected profit of $5.0 billion.
Interim dividend of 79-euro
The company announced an interim dividend of 79-euro cents per share for this fiscal year, an increase of almost 7% and in line with expectations. It will buy back a further $2 billion of its shares in the second quarter, in line with the first-quarter amount.
The stock was little changed in early Paris trading after gaining 11% this year.
Sales of liquefied natural gas, one of the firm’s focus areas, dropped 3% from a year earlier on lower demand in Europe. Total expects that a rebound in consumption in Asia will drive up prices by almost a quarter next winter.
In the hydrocarbon segment, production dropped 2% year-on-year to 2.46 million barrels of oil equivalent per day as the startups of projects in Brazil and Nigeria almost offset the sale of its Canadian oil sands assets.
Downstream operations came in lower because of weaker refining margins. But profit at the power business increased as the firm added renewable capacity in the US and India as well as gas-fired power plants in Texas.
It also reiterated a plan to invest $17 billion to $18 billion in 2024, including $5 billion in its power business.
Nairametrics reported that TotalEnergies Nigeria unit, a member of the TotalEnergies Group, and a player in the petroleum downstream sector has released its unaudited financial statements for 2023.
- The company posted a pre-tax profit of N17.6 billion in FY 2023, which reflects a 28% decline from the N24.5 billion pre-tax profit posted in 2022.
- In 2023, the company recorded a revenue of N636.0 billion, representing a 32% growth from the N482.5 billion recorded in 2022.
- However, there was a corresponding 31% growth in cost of sales to N554.1 billion in FY 2023 from N422.3 billion posted in FY 2022.
- The company’s revenue growth was linked to the growth in the sales of petroleum products off the back of the removal of subsidies on petroleum products.
- The company recorded a 40% growth in petroleum products revenue to N509.3 billion from FY 2022’s N362.7 billion.
- The company recorded a 36% growth in gross profit to N81.8 billion in 2023, from the N60.2 billion posted in 2022.
- However, there was a 14% decline in operating profit to N23.9 billion in the fiscal year, from the N27.7 billion posted in 2022.
- The decline in operating profit is linked to the net foreign exchange loss of N11.5 billion caused by the devaluation of the Naira in 2023.
