TotalEnergies profits hit by weak refining margins

TotalEnergies SE reported a significant drop in third-quarter net income on Thursday, citing weaker refining margins in a “volatile” oil market. The Paris-based energy giant’s adjusted net income fell 37% to $4.07 billion from $6.45 billion a year earlier, aligning closely with the $4.10 billion consensus. Adjusted fully diluted earnings per share also declined 34% to $1.74 from $2.63.

TotalEnergies profits hit by weak refining margins

Cash flow from operations decreased to $6.82 billion, missing the Visible Alpha consensus of $7.3 billion. CEO Patrick Pouyanne described it as a resilient performance amid a “volatile oil environment with sharply declining refining margins.” In Exploration & Production, adjusted net operating income fell 21% to $2.48 billion from $3.14 billion, affected by lower liquid prices, partially offset by an increase in gas prices. In Downstream, adjusted net operating income dropped 67% to $605 million from $1.82 billion due to weaker refining margins. However, marketing and trading activities helped counterbalance the “very sharp” decline in refining.

Dividend raised

Despite lower earnings, TotalEnergies raised its dividend by 6.8% to €0.79 per share from €0.74 and committed to an additional $2 billion share buyback in the fourth quarter, aiming to reach $8 billion for the year. The company also announced on Wednesday the start of oil production from the Mero field’s third development phase on the Libra block off the coast of Rio de Janeiro, Brazil. With Mero-3 now operational, the field’s total production capacity will reach 590,000 barrels per day. TotalEnergies holds a 19% stake in Mero.