French energy major Total has kept its dividend stable despite reporting a sharp drop in first-quarter (Q1 2020) net adjusted profit.
According to Reuters, the drop in profits is attributed to the collapse in oil prices and the economic slowdown caused by the novel coronavirus outbreak.
Total’s net adjusted profit fell 35% from Q4 2019 to $1.78bn.
The company declared the distribution of the 2020 first interim dividend at €0.66 ($0.72) per share.
Reuters said the company’s profits beat analysts’ forecasts.
Total plans to accelerate its dividend growth in future years by increasing the dividend by 5% to 6% per annum.
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By GlobalDataAccording to the news agency, Total’s oil prices fell by more than 30% on average in Q1 2020, while its cash flow slumped by 31% year-on-year to $4.5bn.
Total chairman and CEO Patrick Pouyanne was quoted by the news agency as saying: “The group is facing exceptional circumstances, the Covid-19 health crisis, which is affecting the world economy and creating major uncertainties, and the oil market crisis, with the sharp drop in oil prices since March.”
The company added that it would reduce its investments further to $14bn in 2020, while increasing cost savings to over $1bn.
Last month, Total reported 14 cases of Covid-19 in its operations in Congo. The cases include two of its own staff.
In the same month, Total brokered a deal to acquire oil and gas exploration firm Tullow’s entire stake in the Lake Albert development project in Uganda for $575m.
