Repsol Quarterly Profit Rises 22% on Record Oil Price
Bloomberg.com: Latin America
Nov. 4 (Bloomberg) -- Repsol YPF SA, Europe's fifth-largest oil company, said earnings climbed 22 percent in the third quarter because of record oil prices and wider margins from making fuels.
Net income rose to 934 million euros ($1.11 billion), or 77 cents a share, more than the median estimate of 869 million euros of five analysts in a Bloomberg Survey. Operating profit gained 29 percent to 1.58 billion euros, Repsol said in a filing.
Repsol and competitors including Total SA benefited as hurricanes in the U.S. shut down oil production there and cut gasoline output, increasing demand and prices for European products. Oil in the third quarter reached a record on Aug. 30 of $70.85 a barrel in New York.
``This is going to be as good as it gets for refining,'' said Jason Kenney, an analyst at ING Financial Markets in Edinburgh, which has a ``hold'' rating on the stock.
The company's shares rose 10 cents, or 0.4 percent, to 25.33 euros at 9:47 a.m. in Madrid. Stock in Madrid-based Repsol, the largest oil company in Spain and Argentina, has risen 32 percent this year, compared with a 66 percent gain at Statoil ASA, Norway's largest oil company and the second best-performing oil company so far in Bloomberg's Europe 500 energy index this year.
Refining margins rose 51 percent to $8.96 per barrel, boosted by an 80 percent average increase in margins in Argentina, Bolivia and Brazil to $14.93 per barrel. Sales of refined products rose 0.8 percent to 14.23 million tons.
Repsol also supplies natural gas to the U.S. from a venture in the Caribbean. The company benefits less than its competitors from high oil prices because Argentina has capped prices until 2006.
Investing Outside Latin America
The average oil price for the quarter was $42.5 per barrel, up from $34.91 a year ago, Repsol said. The average price of gas was $1.55 per thousand cubic feet, up 25 percent from a year ago.
Chairman Antonio Brufau is trying to offset lower output in Latin America by investing outside the region, which accounts for two-thirds of Repsol's production. Repsol wants to get 90 percent of its output growth by 2009 from Libya, Algeria, Trinidad and Tobago and Venezuela, he said in May.
Overall gas and liquids output fell 4.4 percent in the third quarter to 1.157 million barrels of oil equivalent a day. That stemmed from a 6.6 percent drop in liquids output, Repsol said.
``Reserve replacement is still an issue,'' Kenney said. ``Repsol is still not coming up with the goods.''
At current rates, Repsol will exhaust its reserves in less than 12 years, compared with almost 14 years at Exxon Mobil Corp., the largest publicly traded oil company. Brufau targets a reserve- replacement ratio of more than 100 percent through, or finding more oil and gas than it pumps. Repsol expects to pump 1.31 million barrels a day in 2009.
A Bolivian law, passed May 17, added a 32 percent tax to the existing 18 percent royalty fee and ordered 12 foreign companies, including Repsol, Brazil's Petroleo Brasileiro SA, Petrobras, and Exxon Mobil Corp. to renegotiate 72 oil and gas exploration and development contracts.
Nov. 4 (Bloomberg) -- Repsol YPF SA, Europe's fifth-largest oil company, said earnings climbed 22 percent in the third quarter because of record oil prices and wider margins from making fuels.
Net income rose to 934 million euros ($1.11 billion), or 77 cents a share, more than the median estimate of 869 million euros of five analysts in a Bloomberg Survey. Operating profit gained 29 percent to 1.58 billion euros, Repsol said in a filing.
Repsol and competitors including Total SA benefited as hurricanes in the U.S. shut down oil production there and cut gasoline output, increasing demand and prices for European products. Oil in the third quarter reached a record on Aug. 30 of $70.85 a barrel in New York.
``This is going to be as good as it gets for refining,'' said Jason Kenney, an analyst at ING Financial Markets in Edinburgh, which has a ``hold'' rating on the stock.
The company's shares rose 10 cents, or 0.4 percent, to 25.33 euros at 9:47 a.m. in Madrid. Stock in Madrid-based Repsol, the largest oil company in Spain and Argentina, has risen 32 percent this year, compared with a 66 percent gain at Statoil ASA, Norway's largest oil company and the second best-performing oil company so far in Bloomberg's Europe 500 energy index this year.
Refining margins rose 51 percent to $8.96 per barrel, boosted by an 80 percent average increase in margins in Argentina, Bolivia and Brazil to $14.93 per barrel. Sales of refined products rose 0.8 percent to 14.23 million tons.
Repsol also supplies natural gas to the U.S. from a venture in the Caribbean. The company benefits less than its competitors from high oil prices because Argentina has capped prices until 2006.
Investing Outside Latin America
The average oil price for the quarter was $42.5 per barrel, up from $34.91 a year ago, Repsol said. The average price of gas was $1.55 per thousand cubic feet, up 25 percent from a year ago.
Chairman Antonio Brufau is trying to offset lower output in Latin America by investing outside the region, which accounts for two-thirds of Repsol's production. Repsol wants to get 90 percent of its output growth by 2009 from Libya, Algeria, Trinidad and Tobago and Venezuela, he said in May.
Overall gas and liquids output fell 4.4 percent in the third quarter to 1.157 million barrels of oil equivalent a day. That stemmed from a 6.6 percent drop in liquids output, Repsol said.
``Reserve replacement is still an issue,'' Kenney said. ``Repsol is still not coming up with the goods.''
At current rates, Repsol will exhaust its reserves in less than 12 years, compared with almost 14 years at Exxon Mobil Corp., the largest publicly traded oil company. Brufau targets a reserve- replacement ratio of more than 100 percent through, or finding more oil and gas than it pumps. Repsol expects to pump 1.31 million barrels a day in 2009.
A Bolivian law, passed May 17, added a 32 percent tax to the existing 18 percent royalty fee and ordered 12 foreign companies, including Repsol, Brazil's Petroleo Brasileiro SA, Petrobras, and Exxon Mobil Corp. to renegotiate 72 oil and gas exploration and development contracts.
posted by Marcel at 8:56 AM
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