Eni archive the first quarter with a net profit of 965 million euros, against the loss of 383 million recorded in the same period last year. L'adjusted net profit is equal to 744 million (from 2 million) and theadjusted operating profit it stands at 1,83 billion, with a +215% from the first quarter of 2016. This was communicated by the oil group, which yesterday approved the results. Operating cash generation grew by 41% to 1,93 billion.
The result for the first quarter, observed Eni, was mainly driven by the robust operating performance of E&P (+€1,53 billion), which reflects the substantial recovery of the oil scenario (+59% the Brent reference), as well as the capital gain on the sale of 10% of the Zohr asset (339 million). In the quarter, consolidated adjusted operating profit of €1,83 billion tripled the value of the first quarter of 2016 and the adjusted net result of €740 billion represents the best quarterly performance in the last two years.
The improvement compared to the breakeven recorded in the first quarter of 2016 is due to the strong increase in operating profitability and the normalization of the tax rate, which stands at 57% due to the improvement in the scenario which reduced the relative incidence of taxable income under the PSA regime, characterized by higher tax rates, and non-taxable costs. Net financial debt as at 31 March 2017 amounted to €14,93 billion, essentially in line with 2016 (+€0,155 billion compared with 31 December 2016).
Il cash flow net from operating activities was 1,93 billion which is recalculated as 2,60 billion before the change in working capital and the reconstitution of inventories. Leverage as of March 31st is stable at 0,28. In the first quarter, disposals were defined for around €2,9 billion, equal to 60% of the minimum disposal target envisaged in the 2017-2020 plan.
“The improvement in the economic and financial results in the first quarter of this year was clear – comments the CEO, Claudio Descalzi – The adjusted profit of approximately 750 million was approximately 460 million (+60%) in the fourth quarter of last year, when prices had already recovered to values close to the current ones, and was zero in the first quarter of 2016, characterized by a scenario prices depressed. Furthermore, the cash contribution for the period of 2,6 billion is the highest in the last 7 quarters. These results are the result of the continuous industrial progress achieved in all businesses, in line with the objectives declared for 2017, all of which remain confirmed. The generation of organic cash flow and proceeds from disposals will allow us in 2017 to fully finance investments and dividends at a Brent price level well below the current one”.
Finally, Eni confirms the hydrocarbon production target for 2017 at 1,84 million boe/d (+5% compared to 2016) thanks to the start-ups of new projects and field ramp-ups initiated in 2016, mainly in Egypt, Kazakhstan, Angola, Indonesia and Norway. Other production optimization initiatives not included in the initial plans are also planned. These increases will be able to absorb mature field declines and an interruption of production activity in Val d'Agri for a period of ninety days. Actions are underway, Eni points out, to reduce the duration of the interruption.
