Repsol posted a net income of 1.796 billion euros in the first nine months of the year a 5.5% decline from the year-earlier period. At current cost of supply (excluding the change in value of the oil inventories that the company stocks as part of Spain’s strategic reserve) Repsol’s net income was 1.706 billion euros, 4% higher than the first nine months of the previous year, despite the negative effect of the illegal expropriation of YPF and the decline in fuel sales in Spain.
Efficient management has allowed Repsol to gradually consolidate the strength of the businesses, particularly after the illegal expropriation of YPF in April of this year. Third quarter earnings show a net profit of 760 million euros, 36.4% higher than the same period of last year, which included YPF.
Along with the strengthening of its industrial units, Repsol has developed an active financial policy throughout the period. The Repsol Group cut debt, excluding Gas Natural Fenosa, by 1.857 billion euros to 4.918 billion euros. The company has liquidity, excluding Gas Natural Fenosa, of 8.415 billion euros, with 3.915 billion euros in cash and available credit lines of 4.5 billion euros.
By business areas, the Upstream unit (exploration and production) reaffirmed the positive trend of previous quarters, both in new discoveries and higher profit. So far this year Repsol has made five new finds, including Pao de Açucar, in Brazil, one of the world’s largest during 2012.
Upstream operating income rose 49.3% to more than 1.8 billion euros, supported by increased production and crude oil and gas realization prices which evolved better than the international prices of reference. Operating income at the LNG business was 425 million euros, and increase of 54% compared to the same period of the previous year.
Operating income from the Downstream unit (refining, marketing, liquid petroleum gas, new energy, chemicals and trading) was directly affected by reduced activity in the petrochemical business and the decline in fuel sales in Spain, which fell by 9% between January and September, and positively by the wider margins resulting from the completion of the expansion of the Cartagena and Bilbao refineries.
Downstream operating income fell 16.9% to 893 million euros compared with the first nine months of the previous year.
[mappress]
LNG World News Staff, November 8, 2012; Image: Repsol