Total share price rises as it swings to profit in the first quarter
French energy giant Total swung into profit in the first quarter of this year, partly due to an uptick in refining revenues.
The firm's adjusted net income swelled from a loss of $1.8bn (£1.2bn) in the last three months of 2015, to a profit of $1.6bn in the first quarter of this year.
While the latest figure was still below the $2.6bn it made during the same period a year ago, it beat analysts' expectations for $1.2bn, suggesting the management's plan to weather low oil prices is beginning to take shape.
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Patrick Pouyanne, chairman and chief executive of Total, stressed that the results came "despite a 37 per cent fall in the Brent price to $34 per barrel since the first quarter of 2015".
Total's top line was boosted by its refining and chemicals sector, where revenue rose three per cent to $1.1bn in the first quarter.
But revenue in its upstream operations — which includes oil exploration — fell 63 per cent to $498m on low oil prices. This was partially cushioned by a four per cent increase in oil output to 2.5m barrels, reduced operating costs as well as lower exploration expenses.
Pouyanne added: "The upstream portfolio benefited from the lowest technical costs among the majors."
Norway's Statoil also beat expectations today due to cost cuts, and said that global oil markets were finally starting to balance.
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Its first-quarter underlying operating earnings came in 70 per cent lower on an annual basis at $857m, but they were above forecasts for $833m.
Yesterday, BP kicked off oil majors' earnings season by reporting a surprise profit of $532m in the first quarter.
It said cost reductions meant it would be able to balance its books with an oil price of $50 to $55 per barrel, down from a previous estimate of $60.