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July 26, 2019

Total reports fall in profit to $2.9bn in Q2 2019

Total has announced its results for the second quarter (Q2) of 2019, reporting decreased profits as a result of lower oil and gas prices.

By Umar Ali

French oil and gas company Total has announced its results for the second quarter (Q2) of 2019, reporting decreased profits as a result of lower oil and gas prices.

The company’s adjusted net income in Q2 2019 was $2.9bn, or $1.05 per share, a 26% decrease from Q2 2018. Total adjusted net income for the first half (1H) of 2019 was $5.6bn or $2.07 per share, a 12% decrease compared to 1H 2018.

Adjusted net operating income for Total’s Exploration and Production division was $2,022m in Q2 2019 and $3,744m in 1H 2019, a 13% decrease from Q2 2018 and a 9% decrease from 1H 2019. Total cited lower Brent and natural gas prices as the reason for this drop in income.

Total chair and CEO Patrick Pouyanné said: “Markets remained volatile with Brent averaging $69 per barrel in the second quarter, an increase of 9% compared to the previous quarter, but natural gas prices were down 36% in Europe and 26% in Asia.

“In this context, with a slight increase in production to 2.96 Mboed, adjusted net income increased by 5% compared to the previous quarter to $2.9bn, and the return on equity remained above 11%.”

Total’s hydrocarbon production was 2,957 kilo barrels of oil equivalent (kboed), an increase of 9% compared to Q2 2018. The company attributed this increase in production to the start-up and ramp-up of new projects, noting that it was partially offset by natural decline and maintenance.

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These projects also accounted for LNG sales increasing by 65% to 4.1 metric tonnes (Mt) in Q2 2019 compared with the 2.5 Mt sold in Q2 2018.

Pouyanné said: “Exploration & Production benefited from the higher Brent with a 15% increase in operating cash flow before working capital changes.

“Although gas prices fell sharply, Integrated Gas, Renewables and Power increased its operating cash flow before working capital changes by 42% thanks to 8% production growth and a 10% increase in LNG sales. Compared to the second quarter 2018, operating cash flow before working capital changes increased by 77%, driven by a doubling of LNG sales.”

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