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TotalEnergies (TTE) Q2 Earnings Lag, Revenues Beat Estimates

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TotalEnergies SE (TTE - Free Report) reported second-quarter 2023 operating earnings of $1.99 (€1.84) per share, lagging the Zacks Consensus Estimate of $2.21 by 9.6%.

The bottom line declined 46.9% from the year-ago figure of $3.75 (€3.50). The year-over-year decline was due to a correction in commodity prices.

Total Revenues

Total revenues for the second quarter were $56.3 billion, down 24.8% from $74.8 billion generated in the prior-year period. However, revenues surpassed the Zacks Consensus Estimate of $42.6 billion by 32%.

Production

Second-quarter hydrocarbon production averaged 2,471 thousand barrels of oil equivalent per day (kboe/d), down 10% year over year (including Novatek). The decline was due to natural decline in fields, end of Bongkot, exit from Termokarstovoye in Russia marginally offset by contributions from startups, and improvement of security conditions in Nigeria and Libya.

For the reported quarter, liquids production averaged 1,571 thousand barrels per day, up 6% from the year-ago period.

Quarterly gas production was 4,845 thousand cubic feet per day, down 29% year over year due to lower gas output from the Asia Pacific, Europe and Americas.

Realized Price

The second-quarter’s realized price for Brent was down 31.4% to $78.1 per barrel from $113.9 in the year-earlier period. The average realized liquid price was $72 per barrel, down 30% from the previous-year figure.

Realized gas prices were down 45.7% from the prior-year quarter to $5.98 per thousand British thermal units (Btu).

Realized LNG prices were down 29.5% from the year-earlier quarter to $42.7 per thousand Btu.

Highlights of the Release

TotalEnergies continued with its multi-energy strategy during the second quarter and launched four projects with an intention to further strengthen its multi-energy business.

Net operating income was $5,582 million, down 47% from the year-ago period due to lower commodity prices.

Interest expenses were $724 million, up 27% from $572 million in the prior-year period.

In second-quarter 2023, TotalEnergies acquired assets worth $482 million and sold assets worth $162 million.

65 million shares were repurchased in the first half of 2023 for $4 billion as a part of TTE’s shareholder return policy. The systematic repurchase of share will strengthen shareholders value.

Segmental Details

Exploration & Production’s operating earnings were $2,349 million, down 50% from $4,719 million in the year-ago period.

Integrated LNG’s operating income of $1,330 million tumbled 40% from $2,215 million in the year-earlier quarter.

Integrated Power’s operating income of $450 million rose 32% from $340 million in the year-ago quarter.

Refining & Chemicals’ operating income of $1,004 million plunged 64% from $2,760 million in the prior-year quarter.

Marketing & Services’ operating income of $449 million dipped 4% from $466 million in second-quarter 2022.

Financial Update

Cash and cash equivalents as of Jun 30, 2023, were $25.6 billion compared with $33.1 billion as of Dec 31, 2022. Net debt to capital was 16.3% at the end of second-quarter 2023 compared with 12.7% at fourth-quarter 2022 end.

Cash flow from operating activities at first-quarter end was $9,900 million, down 39.2% from the year-ago period.

Guidance

TotalEnergies expects third-quarter 2023 hydrocarbon production to be 2.5 Mboe/d with support coming from the start-up of Absheron field in Azerbaijan. The company projects LNG prices in third quarter in the range of $9-$10/MBtu.

TotalEnergies anticipates to invest $16 billion in 2023, of which $5 billion will be allocated to further strengthening renewable operations and electricity.

Zacks Rank

TotalEnergies carries a Zacks Rank #5 (Strong Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Upcoming Releases

Exxon Mobil Corporation’s (XOM - Free Report) is scheduled to release second-quarter 2023 earnings on Jul 28. The Zacks Consensus Estimate for quarterly earnings is pegged at $2.04 per share, suggesting a decline of 50.7% from year-ago reported figure.

The Zacks Consensus Estimate for Exxon Mobil’s 2023 EPS of $8.92 implies a year-over-year decline of 35.6%. XOM’s long-term (three-to-five year) earnings growth is anticipated to be 19.55%.

Chevron Corporation (CVX - Free Report) is slated to release second-quarter 2023 earnings on Jul 28. The Zacks Consensus Estimate for quarterly earnings is pegged at $2.95 per share.

The Zacks Consensus Estimate for Chevron’s 2023 EPS of $13.02 indicates a year-over-year fall of 30.86%. CVX’s long-term earnings growth is projected to be 14.27%.

ConocoPhillips (COP - Free Report) will report second-quarter 2023 earnings on Aug 3. The Zacks Consensus Estimate of $1.97 per share for quarterly earnings suggests a decrease of 49.6% from year-ago reported figure.

The Zacks Consensus Estimate for COP’s 2023 EPS of $8.94 implies a plunge of 33.9% from year-ago reported figure. COP’s long-term earnings growth is estimated to be 18.19%.

 

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