Eni Posts 25% Drop in Second-Quarter Profit

Italy’s Eni reported 25% lower profit for the second quarter of the year amid lower oil prices and a 2.6% decline in oil and gas production.

The adjusted net result for March to June stood at 1.13 billion euro ($1.33 bln), on earnings before interest and tax of 2.68 billion euro ($3.15 bln).

Among the highlights of the quarter, the company listed an oil discovery in Namibia, a gas discovery in Angola, and a new LNG project in Argentina, which is planned to export some 30 million tons of the superchilled fuel in 2030.

Also during that quarter, the Italian Big Oil major sold a 20% stake in its low-carbon energy subsidiary Plenitude to Ares Management Corporation in a deal valuing the unit at an enterprise value of $13.8 billion. The price tag of the stake sale was $2.3 billion.

“The economic environment remains challenging, but Eni’s business model is strong and flexible,” chief executive Claudio Descalzi said in the news release of the second-quarter numbers.

“Strict financial discipline, a stronger portfolio, and low breakeven projects support this resilience and ensure a self-funded growth strategy. At the same time, we continue to deliver value for shareholders while keeping the balance sheet stronger than ever.”

Eni raised its outlook for cash flow from operations for the full year to 11.5 billion euro ($13.51 bln) from 11 billion euro in the quarterly report, and kept its capital expenditure plans unchanged, at below 8.5 billion euro ($10 billion). It also said shareholder returns will remain steady despite the challenging environment.

Oil and gas production guidance was left unchanged from the previous quarter, at 1.7 million barrels of oil equivalent daily. In the third quarter, the production guidance is between 1.7 million and 1.72 million barrels of oil equivalent daily.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com