Milan — Italian energy group Eni reported a 49% fall in its adjusted net profit in the second quarter because of weaker commodity prices but a strong performance from its gas business helped it to beat forecasts.
Adjusted net profit in the period came in at 1.94 billion euros ($2.13 billion) down from a bumper result of 3.81 billion euros a year ago, but above an analyst consensus of 1.64 billion euros.
Following Russia’s invasion of Ukraine last year, Eni moved quickly to replace Moscow’s gas supplies with fuel it extracts in African countries, strengthening its position on the gas markets.
Eni now expects the gas business to reach an adjusted earnings before interest and taxes (EBIT) figure of between 2.7 billion and 3.0 billion euros for the year versus previous guidance of 2.0-2.2 billion euros.
Group’s expectation for adjusted EBIT for this year is confirmed at 12 billion euros even after taking into account a weaker oil and gas prices.
REWARDING INVESTORS
On Thursday Shell and TotalEnergies reported sharp falls in second-quarter profit from bumper 2022 earnings as oil and gas prices, refining margins and trading results all weakened.
“Eni has reported a strong set of second-quarter results, with adjusted EBIT and net income coming in well ahead of market expectations,” said Royal Bank of Scotland in a note, adding the new guidance for the gas division was a significant move up relative to market expectations.
Shares in the group were up 1%, outperforming a flat Milan’s blue-chip index at 0740 GMT.
In the second quarter Eni and other energy groups had to cope with a 30% fall in crude oil prices and a drop of more than 60% in the gas price and refining margins compared with the same period last year.
Despite a weaker outlook for commodity prices, Eni said it would continue a share buy-back programme started in May.
“Considering our first-half results and continuing business
performance that drives raised guidance, we have a solid position from which to pay our first quarterly instalment of the raised 0.94 euros per share 2023 dividend in September and continue our 2.2 billion euro buy-back,” Eni CEO Claudio Descalzi said.
Follow us on twitter
