The accounts below analysts' expectations sink Eni in the start-up with a drop of 1,82%. In the morning, however, the six-legged dog regained its share slightly and is now trading down by 0,39%. The continuation of the Libyan crisis weighed on all sectors of activity.
The production of hydrocarbons recorded a drop of 15% in the last quarter alone to 1,489 million barrels per day (-12% in the six months), a drop that would have amounted to only 2% net of the production loss in Libya and the price effect. This is a loss of 200 barrels per day compared to the second quarter of 2010, to which must be added the 36 barrels which were affected by the increase in oil prices. To bring production back to pre-crisis levels, it will be necessary to return to normality.
This is the situation: all Eni production activities and exports through the GreenStream pipeline have been suspended with the exception of the Wafa field which produces quantities of gas and associated liquids destined to feed the country's electricity generation plants; the plants and the pipeline have been made safe and to date have not suffered damage and since March Eni has evacuated all expatriate personnel and suspended all activities related to exploration and development projects. At stake is a net invested capital of about $2 billion.
Going back to the accounts, gas sales in the second quarter showed an increase of 9% to 21 billion cubic meters in the April-June period (+7% in the first six months of the year) and the group expects 2011 to grow despite the expected drop in sales to shippers due to the Libyan crisis.
They benefited from the significant improvement in the markets and Europe, the latter driven by Turkey, Germany, Austria, Belgium, UK, Northern Europe and France. But the six-legged dog manages to recover market share in Italy too thanks to the reconquest of customers and higher orders in the thermoelectric, industrial and wholesale segments.
In terms of profits, the group recorded a drop of 31% to 1,25 billion euro, over the half year however the drop was more limited: -6% to 3,8 billion euro compared to the first half of 2010. In the second quarter of 2011 l Adjusted net income was €1,44 billion, down 14% compared to the second quarter 2010 due to lower operating performance and a two percentage point increase in the consolidated tax rate.
Adjusted net profit for the six months was €3,63 billion (+4% compared to the first half of 2010) and reflects the improvement in operating performance with a slightly lower tax rate (-0,5 percentage points). Adjusted operating profit showed an increase of 8% to 9,1 billion euros in the first six months of the year, while in the April-June period it decreased by 3% to 4 billion. Cash flow for the first six months amounted to 8,6 billion (4,41 billion in the quarter).
Well received by analysts, however, an increase in the dividend has arrived with the proposal of an interim payment of 0,52 euro compared to 0,50 in 2010 (payable starting from 22 September 2011 with ex-dividend date on 19 September 2011). “During the period, we consolidated our growth prospects thanks to progress on development projects, important exploration successes and new agreements in core areas and in new areas with high potential. The solid results expected for 2011 and the future growth and profitability prospects allow us to confirm our dividend policy and to propose an interim dividend of €0,52 per share,” commented the CEO Paolo Scaroni.
In particular, Eni started-up four fields in the USA, Congo and Italy during the half-year and obtained exploration permits in Indonesia and entry into two gas discoveries in the Australian Timor Sea, in addition to exploration successes (such as those in Norway, Ghana and Venezuela) with an increase in Eni resources of 515 million barrels in the six months.
