LA DEFENSE (dpa-AFX) - French oil giant Total SA (TOT, TTFNF.PK, TTA.L) Friday said the deterioration of environment in its refining and chemicals segment dragged its first-quarter profit down, even though the upstream and marketing businesses performed well. Total sales climbed despite flat production.
Looking ahead, the company expects second-quarter production to be impacted by the incidents in the UK, Nigeria, and Yemen as well as by scheduled seasonal maintenance. The start of production at three new major projects since the beginning of the year could provide some solace, the company said.
Total noted that the refining & chemicals segment has experienced a rebound in refining margins in Europe since the start of the second quarter. This reflects lower oil prices and lower available capacity due to seasonal shut-downs for major turnarounds and refinery closures in the Atlantic basin.
For the first quarter, Total's net income (Group share) was 3.66 billion euros, 7 percent lower than last year's 3.95 billion euros. Expressed in US dollars, net profit dropped 11 percent to $4.8 billion. Earnings per share fell to 1.62 euros from 1.75 euros a year ago.
Chairman and CEO Christophe de Margerie said, 'In the context of oil prices that were favorable for upstream but difficult for refining & chemicals activities, the group is satisfied with its first- quarter profit.'
Adjusted net income, which excluded certain items, slid 1 percent to 3.07 billion euros.
Sales climbed 11 percent to 51.17 billion euros from 46.03 billion euros in the previous year. The sales growth was 7 percent in dollars to $67.07 billion.
In the quarter, upstream sales grew 7.85 percent from last year, refining & chemicals sales climbed 19 percent, and supply & marketing sales rose 4.5 percent.
Upstream production was 2.372 million barrels of oil equivalent per day, flat with last year's 2.371 million barrels. All regions, except Africa and CIS, generated lower production.
In the quarter, a 5 percent decline in liquids production was offset by a 6 percent increase in gas production. The company noted the output drop partly reflected security conditions in Syria, even though Libya is returning to production.
Total refinery throughput declined 9 percent mainly due to the sale of interest in CEPSA last year. Excluding this impact, throughput grew 2 percent.
Total supply and marketing sales volume fell 19 percent due to the sale of marketing activities in the UK and its interest in CEPSA.
The Brent price averaged $118.6 per barrel, a growth of 13 percent from last year. Average liquids price and gas price grew 16 percent each.
The European refining margin indicator decreased 15 percent to $20.9 per tonne. The company pointed out that the European environment for petrochemicals continued to deteriorate amid weak demand and high raw material costs.
Further, the board has decided on April 26, 2012 to pay an interim 2012 dividend of 0.57 euros per share on September 27, 2012.
In Paris, Total shares are currently trading at 35.83 euros, down 0.69 euros or 1.87 percent.
Copyright RTT News/dpa-AFX