MW: Higher oil prices boost 4th-quarter profit at Total and Statoil
By Polya Lesova, MarketWatch
FRANKFURT (MarketWatch) -- Energy giants Total SA and Statoil ASA on Thursday reported strong fourth-quarter profit, as rising oil prices offset weak refining margins and lower natural-gas prices.
France's Total (TOT 56.01, -0.02, -0.04%) (FR:FP 42.01, +1.09, +2.66%) swung to fourth-quarter net income of 2.07 billion euros compared with a loss of 794 million euros in the year-earlier period.
Sales dropped 6% to 36.23 billion euros.
Adjusted net income -- adjusted for special items and excluding Total's share of the amortization of intangible assets related to the Sanofi-Aventis merger -- fell 28% to 2.08 billion euros.
Analysts at Dow Jones Newswires expected adjusted profit of 1.99 billion euros.
"The 2009 oil-and-gas-market environment was marked by a sharp decline in the demand for oil, natural gas and refined products," said Christophe de Margerie, Total's chief executive, in a statement.
Oil prices rebounded during the year thanks to production cuts by the Organization of the Petroleum Exporting Countries and market expectations of an economic recovery, he said.
"In contrast, natural-gas spot prices remained depressed and refining margins fell to historically low levels, under pressure from significant overcapacity," de Margerie said.
In the fourth quarter, Total's realized liquids prices rose 43% from a year earlier to average $70.60 a barrel. In contrast, realized natural-gas prices dropped 33%.
Total's European refining margin indicator slumped 71% in the fourth quarter. In recent weeks, Total refineries in France and the U.K. have been hit by strikes, as workers have voiced their opposition to announced job cuts.
Shares of Total gained 2.6% in recent trading on Euronext in Paris. They have risen 5% over the past 12 months.
Statoil
Also on Thursday, Statoil, which is based in Stavanger, Norway, said its fourth-quarter net income more than tripled to 7.1 billion Norwegian kroner ($1.21 billion) from 2 billion kroner in the year-ago quarter.
The result reflects higher oil prices and increased lifting, as well as lower net financial losses and lower tax rates compared with 2008, partly offset by lower gas prices and refining margins, Statoil (NO:STL 130.10, +3.20, +2.52%) (STO 21.68, -0.54, -2.43%) said.
The average prices for liquids rose 17% and lifted volumes of oil and gas grew 4%.
Fourth-quarter revenue fell to 124.4 billion kroner from 150.7 billion.
Operating profit fell to 33.5 billion kroner from 37.8 billion, mainly as a result of a 48% drop in natural-gas prices and a 55% reduction in refining margins.
The board proposed a dividend of 6 kroner a share for 2009, and it might buy back shares as a way of distributing capital to holders, Statoil said.
Shared of Statoil rose 2.4% in mid-morning trading in Oslo. They have gained 6% over the past 12 months.
