By Jose Elias Rodriguez
MADRID (Reuters) – Repsol announced Thursday a tight extraordinary and reserve replacement cost net profit (CCS ) of 572 million euros, with an unexpected positive contribution of its exploration and production activity precisely the business area that is diminishing the benefits of international oil for the low price of oil.
Although the result is less than the 928 million in the first quarter of 2015 (when Repsol had a high extraordinary income linked to currency hedges), is handily placed above the most optimistic expectations of analysts, They augured that block the red in “upstream”.
The news drove nearly 5 percent the price of Repsol, who starred early increases the Ibex-35.
“Posted much better results than expected from the operating level, especially in upstream,” said analysts at Sabadell in a report to clients. “” The reason for the deviation were a lower exploration expenses and especially the accrual of a 22% target synergies of the year (1,100 M euros for cost savings post Talismán) “.
in its statement, Repsol said it had a positive result in” upstream ” of 17 million euros compared to losses of 190 million a year earlier and red numbers 276 million in the last quarter of 2015.
Repsol said the decline in exploration costs, increased production after purchase of Canada’s Talisman and a positive tax effect of 161 million euros by the appreciation of local currencies were responsible overturning the results of “upstream”.
in the tough business of refining or “downstream “the result improved by 4 percent to 556 million euros despite a decline in refining margins in Spain, thanks to the contribution of the petrochemical area.
In contrast, the contribution of its subsidiary Gas Natural was loose, with a drop of almost 19 percent to 99 million euros in its contribution to adjusted profit
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