TOTAL Gains, Misses Estimates – Analyst Blog

TOTAL S.A. (TOT) reported first quarter 2010 earnings of $1.42 per share (€1.02 per share), below the Zacks Consensus Estimate of $1.53 and above fourth quarter profit of $1.37 (93 eurocents per share). Earnings per share also increased substantially from $1.23 (95 eurocents per share) reported a year ago. Earnings improved due to higher production and better oil realizations.

Total revenues improved 33% (up 25% in euros) from the year-ago quarter but declined 2.9% (down 3.8% in euros) sequentially to $52.0 billion (€37.6 billion). The decline was mainly due to lower realized gas prices in the Upstream segment and reduced throughput volumes in the Downstream segment.

Total hydrocarbon production averaged 2,427 thousand barrels of oil equivalent (MBOE) per day, up 5% from the year-ago quarter and 2% from the previous quarter. The increase was mainly due to production improvements and start-ups of new fields, lower OPEC (Organization of the Petroleum Exporting Countries) reductions and lower gas demand, and fewer disruptions in Nigeria.

Liquids and gas production averaged 1,373 thousand barrels (MBbls) per day (down 3% year over year) and 5,829 thousand cubic feet (Mcf) per day (up 18% year over year), respectively. Realized hydrocarbon prices increased 43% year over year in the quarter, with liquids realizations up 79% and gas realizations down 15%. Total hydrocarbon realizations improved 2% sequentially.

Total refinery throughput was 1,993 MBbls per day, down 11% year over year and 3% sequentially, driven by the shutdown of Dunkrik refinery and a distillation unit at the Normandy refinery. Crude based utilization rates declined to 73% in the quarter from 81% a year ago. Crude and other feedstock based utilization rates were down to 77% versus 86% in the comparable quarter last year.

Chemicals’ revenues increased 31% from the year-ago quarter to €4.2 billion, driven by ramp-up of petrochemical production at its new ethane cracker facility in Qatar and from its Specialty chemicals units that are well positioned for the economic recovery.

In the reported quarter, TOTAL generated a net cash flow of $3.6 billion (€2.6 billion) and reduced its net debt-to-equity ratio to 21.5% from 26.6% at year-end 2009. Net investments increased 16% from the year-ago quarter to $3.7 billion (€2.7 billion), including acquisitions worth $1.7 billion (€1.2 billion) and asset sales of $1.3 billion (€965 million). At quarter-end, TOTAL had €12,954 million of cash and cash equivalents.