Zhitong Finance learned,$TotalEnergies (TTE.US)$The financial results for the third quarter were announced. According to the data, Q3 revenue was US$59 billion, down 14.5% year on year, and the market forecast was US$49.21 billion. Net profit was $6.7 billion, up 1% year over year and 63% month on month. Adjusted net profit was US$6.5 billion, down 35% year on year and up 30% month-on-month. The average market forecast was US$6 billion. Adjusted earnings per share were $2.63, down 31% year over year and up 32% month over month.
French energy giant Total Energy's profit rebounded in the third quarter, ending three consecutive quarters of decline. The company benefited from rising oil prices and increased refining profit margins. Although oil giants are earning less than last year's record level, the industry still has significant cash flow into its reserves. This has enabled them to increase their dividends to shareholders, and recent weeks have also led to America's biggest takeover deal in decades. Total CEO Patrick Pouyanne said in a statement on Thursday: “Total has once again demonstrated its ability to take advantage of a favorable price environment this quarter.”
Affected by the previous drop in energy prices, the company's third-quarter adjusted net profit fell 35% from last year's record high, but the company maintained its share repurchase business against the backdrop of the Arab-Israeli conflict driving up oil prices. Total confirmed that it will repurchase $9 billion of shares throughout the year. Looking ahead, the company also confirmed net investment guidance for 2023 of $16 billion to $17 billion. The company's directors will also decide that the third interim dividend of 2023 will be distributed at €0.74 per share, an increase of 7.25% compared to the three interim dividends paid in fiscal year 2022, which is the same as the first and second 2023 interim dividends.
Compared to the previous quarter, the biggest increase in revenue was in the company's exploration and production division, as well as the refining and chemical divisions. The former was boosted by rising energy prices, while the latter enjoyed greater profit margins. However, due to planned maintenance and unplanned shutdowns — maintenance at the Port Arthur refinery in Texas and the refinery in Antwerp, Belgium outpaced the increase in French refinery throughput, refining throughput fell 7% year over year in the third quarter. The company said the Port Arthur plant will restart in mid-November.
Since the outbreak of the Russian-Ukrainian war last year, Total's LNG business has been a major profit driver, in addition to crude oil, due to the transfer of goods from lower-price markets to profitable trade in Europe. The company expects the region's gas market to remain “tight” this winter despite high inventories.
According to the statement, its average LNG sales price in the third quarter was $9.56 per million Btu, which is expected to rise above $10 in the last three months of this year. Total hydrocarbon production for the fourth quarter is expected to average 2.4 million to 2.5 million barrels of oil equivalent per day, little change from 2.48 million barrels in the third quarter.
The company's profits were boosted by increased and consolidated renewable energy production capacity and continued high oil prices, even as crude oil prices fell from a 10-year high. The report said that at the beginning of the fourth quarter, oil prices remained high at around 90 US dollars/barrel. Total added that, driven by emerging countries, petroleum product production will increase by 2 million b/d this year, mainly due to the recovery of the aviation industry and demand from the Chinese petrochemical industry.
The company also said that due to an increase in renewable energy generation, the adjusted operating profit and cash flow of its power business both exceeded $500 million for the first time in the third quarter. Net power generation totaled 8.9 terawatt-hours (TWh), an increase of 4% year over year due to the increase in renewable energy production after the full integration of renewable energy company Total Even and US photovoltaic facilities.