Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on REPSOL SA. We currently have 13 research reports from 3 professional analysts.
Frequency of research reports
Research reports on
GMP FirstEnergy ― UK Energy morning research package
08 Dec 16
Madalena Energy (MVN CN) (not covered): Transaction in Argentina | Tag Oil (TAO CN); BUY, C$1.25: successfully tests Cardiff and Supplejack in New Zealand | LEKOIL (LEK LN) (not covered): Otakikpo Production Update in Nigeria | LEKOIL (LEK LN) (not covered): Otakikpo Production Update in Nigeria
First view: small miss on earnings, more cost cutting
03 Nov 16
The company report an adjusted net income of €307m vs. €320m expected. By business units: 1) Upstream’s adjusted net income was a loss of €28m, much better than a year ago (€-395m) but lower than the €5m loss expected. Production was up 3%. 2) Downstream’s adjusted net income was €395m, down 42% yoy vs. €385m expected. The lower refining margin decreased operating income by €289m, Chemicals generated a negative effect of €45m in the operating income while Trading’s and Gas&Power’s operating income had a €24m negative impact. The group also benefited from the sale of its stake in Gas Natural. Special items in Q3 16 included a net gain of €180m, mainly due to the sale of a 10% stake in Gas Natural SDG and a partial sale of the piped LPG business offset by the impacts of currency devaluation in Venezuela and rig stand-by costs. The group’s net debt at the end of Q3 16 stood at €9.9bn, €1.7bn lower than in Q2 16 thanks to divestments in the quarter, and good cash flow from operations.
More cost reductions and good operational performance
22 Aug 16
We come back to the Q2 16 results published at the end of July. At that time, as a reminder, the group reported an adjusted net income of €345m for Q2 16, up 11% yoy, perfectly in line with the market’s expectations, but above our own estimates (10% below consensus on cautious synergies and costs). Upstream In the upstream division, adjusted net income was €46m vs a loss of €48m a year ago, mainly due to lower exploration expenses (+€144m), higher volumes (+€290m) thanks to acquired assets and a positive tax effect from the appreciation of local currencies. Lower crude oil had a –€372m impact compared to last year. Average production was 687kbpd, up 33% yoy, due to a full quarter of volumes from acquired assets vs. a partial contribution last year. It was also helped by the ramp-up of Cardon in Venezuela, Sapinhoa in Brazil and the contribution from Gudrun in Norway. Some maintenance work and temporary suspensions due to low prices explained the 2% decrease vs. Q1 16. In terms of production, in Brazil, the hook-up of the FPSO at Lapa (break-even close to $55/bbl) has been concluded and first oil is expected to come one quarter ahead of schedule. In the UK, the rising costs with capex and opex are below plan and production is ahead of schedule. In North America, production at Marcellus has increased yoy, while reducing drilling activity to one rig with a cash break-even close to $2/mmbtu. In Venezuela, the teams are working to solve the issue with the escrow account in order to make the JV work financially. Downstream In downstream, adjusted net income was down 14% yoy to €378m on lower volumes produced, lower margins and maintenance in the refining system (-€224m). On the positive side, Chemicals, Marketing and the LPG businesses improved. The schedule of maintenance stoppages at Cartagena and Tarragona were completed on time and on budget. The planned outages reduced the group’s distillation and conversion utilisation during the quarter. The group achieved an actual refining margin of $0.6, $0.1 over an indicator. The group has completed its major maintenance programme for 2016 and expects its actual margin to recapture the full benefit of its industry-leading facilities in the second half of the year. In Chemicals, sales have again been strong and the margin should remain high for the rest of the year. Spanish motor fuel demand maintained its recovery and the market has grown by 3.6% yoy up to the end of May. Gas Natural Fenosa The adjusted net income at Gas Natural Fenosa stood at €96m, down 9% yoy due to lower profits from gas commercialisation, attributable to the current price environment. Cash flow and debt Cash flow from operations was €1.8bn and covered net investment, interest and dividend payments in the first half of the year. Net debt is slightly down compared to Q1 16, from €12bn to €11.7bn. The group’s liquidity at the end of the H1 16 was €6.7bn including drawdown credit lines which represent 1.8x the coverage of short-term maturities. Change in working capital so far in 2016 is €723m, which also explains the small decrease in debt.
First view: in line with the consensus, better cost cutting, resilient Refining
28 Jul 16
The group reported an adjusted net income of €345m for Q2 16, up 11% yoy, perfectly in line with the market’s expectations. In the upstream division, adjusted net income was €46m vs a loss of €48m a year ago, mainly due to lower exploration expenses, higher volumes thanks to acquired assets and a positive tax effect from the appreciation of local currencies. Production averaged 697kbpd, up 33% yoy. The ramp-up from Cardon IV in Venezuela and Sapinhoa in Brazil, plus Gudrun in Norway and better production in Peru all helped. In the downstream, adjusted net income was down 14% yoy to €378m on lower volumes produced, lower margin and maintenance in the refining system. On the positive side, Chemicals, Marketing and LPG businesses improved. The adjusted net income at Gas Natural Fenosa stood at €96m, down 9% yoy due to lower profits from gas commercialisation. Cash flow from operations was €1.8bn and covered net investment, interest and dividend payment in the first half of the year. Net debt is slightly down compared to Q1 16, from €12bn to €11.7bn.
Talisman starts to deliver; refining still key
14 Mar 16
The group had already discussed its Q4 15 figures at the end of January 2016. Here we bring more colour to the details. Adjusted income in Q4 15 came in at €461m, up 25% yoy, leading to €1.86bn for the full year. Non-recurring was of €2.39bn, largely due to impairments, mostly in the Upstream business (partially offset by a gain from the Talisman bonds amounting to €155m after taxes). By division 1) E&P In the E&P division, the group reported an adjusted net loss of €276m, leading to a loss of €909m for the full-year 2015. Production came in at 697kbpd, up 88% yoy (thanks to Talisman accounting for 318kbpd), with liquids accounting for 35% of the production. Brazilian production was 45kbpd. Libya is still a worry. In January 2016, production averaged 714kbpd. Operating income in the division was -€488m. The factors explaining this yoy performance are: - Lower energy prices: €-307m - Income tax expenses: +€132m (due to lower results) - Exploration expenses: +€89m (lower amortisation and lower seismic expenses) - Higher production: +€11m, despite Libya (-€74m) Operating income of Talisman’s assets was -€208m, and -€115m for the adjusted net income. 2) Downstream In Downstream, the group reported €495m of adjusted income, leading to adjusted net income of €2.15bn for the full year. THe refining margin was $7.3/bbl, compared to $8.8/bbl in Q3 15, but still up on a yoy basis ($5.5/bbl in Q4 14). Enhanced performance in the trading business also helped, even if the effects were partially offset by lower results in the Gas & Power business. The utilisation ratio came in at 89.3%. Operating income in the division was €705m. The factors explaining the operating income yoy performance are: - Higher utilisation and better margin: +€69m - Increased efficiency in chemicals (better international environment): +€65m - FX rate effect: +€71m 3) Gas Natural Fenosa Adjusted net income of Gas Natural Fenosa stood at €123m, 84% higher yoy, mainly due to the contribution of CGE-Chile and the impairment booked in the Q4 14. For the full year, Gas Natural Fenosa’s results came in at €453m. Cash flow Net debt was €11.9bn, down €1bn compared to Q3 15. Cash flow from operations was €2.35bn. The board approved the proposed “Repsol Flexible dividend” programme. With a dividend of €0.3/share and a scrip dividend option, this represents a 40% reduction in the complementary dividend to be paid in June. Overall, this represents a 20% cut in the dividend (at €0.77/share vs. €0.96/share a year ago). Capex is to be reduced to €3.9bn in 2016.
Repsol's answer is clear and strong: adapt to very low oil prices
28 Jan 16
Repsol announced some figures ahead of its official results publication (25/02). The group suffered a net loss of €1.2bn for 2015 after one-off charges of €2.9bn. On an adjusted base, net profit was €1.85bn, 10% above our figures, driven in our view by refining and strong cost cutting on Talisman. Also, the group will reduce capex in 2016 by another 20% to $4bn and increase savings of €1.1bn, of which more than 50% is planned by 2018. Annual savings from the integration of Talisman should be close to $400m, compared with the $220m initially forecast. The company’s Board signed off on the revised strategy at a meeting on Wednesday.
20 Feb 17
Hayward Tyler Group* (HAYT): Trading update and financial position (CORP) | Petra Diamonds (PDL): Interim results (BUY) | Gemfields* (GEM): Interim results (CORP) | Premaitha Health* (NIPT): Middle East momentum (CORP) | Sound Energy (SOU): Acquisition update and TE-8 well spud (HOLD) | Proactis* (PHD): Interim trading on track (CORP) | 7digital* (7DIG): Automotive contract win (CORP)
The Slide Rule
12 Jan 17
What is The Slide Rule? The Slide Rule has been designed to dramatically simplify the identification of the best companies in the UK small/mid-cap sector by making a quantitative assessment of the relative potential of each company. At its core, The Slide Rule aims to identify those companies that create genuine shareholder value through strong returns on capital and solid growth, but also present a value opportunity with the potential tailwind of earnings momentum. Companies are assessed within a Quality, Value, Growth and Momentum (QVGM) framework.
Small Cap Breakfast
16 Feb 17
Saffron Energy—Schedule One update. Raising £2.5m, expected Mkt Cap £7.7m. Admission due 24 Feb. Italian Oil & Gas Play Guinness Oil & Gas Exploration—Publication of prospectus. Seeking to raise £50m and invest in 15 exploration companies at launch, with plans to grow the portfolio to 30 positions during its lifetime. Issue closing 23 Feb. Arix Bioscience — Intention to float on the main market from the global healthcare and life science Company supporting medical innovation. Raised £52m in Feb 16 with investors including Woodford Investment Management
Playing the long term, with short-term risks
16 Feb 17
After the publication of the annual results, we update our view and highlight the key points. Q4 16 key highlights As a reminder, the company reported results 30% below expectations at $400m for Q4 16. By division: 1) In upstream, underlying replacement costs profit came to $400m, vs. a loss a year earlier of $728m and a loss of $224m in Q3 16, reflecting the ongoing lower costs which have benefited from simplifications, efficiencies and lower exploration write-offs. In the US, the loss is still $147m. Production came in at 2.19mbpd, down 5.5% yoy due to disposals and up 1.8% on an underlying basis thanks to ramp-ups. One of the key events during the quarter was the renewal of BP’s onshore concession in the UAE with a 10% interest in the ADCO onshore oil concession. In terms of outlook, production should be higher in 2017 and will depend on the timing of project start-ups, acquisitions, divestments, and OPEC quota. Also the Abu Dhabi concession will be visible as from Q1 17. 2) In downstream, replacement costs profit came to $877m, down from $1.2bn a year ago and $1.4bn in Q3 16. The US division showed a loss of $371m vs a gain of $1.25bn. Non-US Fuel business earnings halved to $417m due to the weaker refining environment as well as the impact from the particularly large turnaround at the Whiting refinery. In lubricants, profit rose to $357m, reflecting the continued strong performance in its growth markets and premium brands as well as simplifications and greater efficiencies. The margin should remain unchanged for Q1 17. 3) Rosneft. Underlying replacement costs profit came to $135m, down from $235m a year ago, affected by the increased government take. Production was at 1.15mbpd, up from 1.03mbpd a year ago. This reflects the completion of the acquisition of Bashneft and Rosneft’s increased stake in the PetroMonagas venture. BP received a dividend of $322m after deduction of the withholding tax, in July 2016. On the Macondo oil spill, the charge taken for the Q4 16 pre-tax was $530m. This reflects BP’s latest estimates for claims including business economic loss. The pre-tax cash outflow on costs related to the oil spill for the full year 2016 was $7.1bn. Cash flow Excluding the Gulf of Mexico payment, the operating cash flow was $4.5bn. Underlying operating cash flow excluding the oil spill-related payment was $17.8bn for the full year. Proceeds during the year and the scrip dividend were not enough to cover capex and the cash dividend. Gearing at the end of the year increased to 27% ($35.5bn debt), in the high range of the group’s target of 20-30%. Organic capital was $16bn, below original guidance of $17bn to $19bn. Capex in 2017 should be close to $16-17bn. Divestment proceeds should be higher in 2017, close to $5bn and then reducing by $2-3bn per year after 2018. The total costs of the Deepwater payment should fall to $2bn in 2018 and then $1bn per year as from 2019. In 2017, this should be close to $5bn. All in all, including the latest acquisitions, cash flow break-even should be close to $60/bbl in 2017.
Share & share alike
14 Feb 17
The rally in the last fortnight, highlighted in the table, reflects a continued flow of positive updates and economic news. The FTSE 250, Small cap and Fledgling indices have reached record highs. We are in the lull ahead of results for those companies with a December year end, a welter of economic data regarding the UK economy, the State of the Union address in the US on 28 February and the UK Budget on Wednesday 8 March. We will learn at that stage the latest forecasts from the Office of Budget Responsibility. As highlighted previously, the reaction to corporate updates will continue to set the tone.
GMP FirstEnergy ― UK Energy morning research package
17 Feb 17
Enquest (ENQ LN): Speculative Buy, £0.65: Kraken FPSO in the field and hooked up in the North Sea | Ithaca Energy (IAE LN/CN)6: BUY, £1.40: Stella First Hydrocarbons in the North Sea | Bowleven (BLVN LN) (not covered): Denies claims made by Crown Ocean Capital