Statoil Q4 Pre-tax Profit Down On Lower Production, Gas Price; Hikes Dividend

(RTTNews) - Norwegian energy firm Statoil ASA (STO) reported Friday a higher net profit for the fourth quarter, while pre-tax profit declined from last year. The results were negatively impacted mainly by North American operations with lower production and average gas prices, partly offset by higher liquid prices. The company also announced a higher dividend.

For the fourth quarter, net income increased 14 percent to 14.8 billion Norwegian kroner (about $2.38 billion) from 13 billion kroner last year.

Income before tax, declined 13 percent to 39.8 billion kronor from 45.9 billion kronor in the previous year. Adjusted earnings after tax, which excluded certain items, were 11 billion kronor, compared to 15.1 billion kronor a year ago.

The company's net operating income declined 4 percent year-over-year to 43.9 billion kroner.

Quarterly total revenues and other income edged down 1 percent to 158.4 billion kroner from 160.1 billion kroner a year ago. Adjusted total revenues and other income were down 4 percent as higher liquids prices measured in NOK were offset by reduced volumes of liquids and gas sold and lower average gas prices due to increasing share of US gas, the company added.

In the quarter, total equity liquids and gas production declined 4 percent to 1,945 mboe per day.

Total entitlement liquids and gas production - net of US royalties was down 5 percent to 1,723 mboe per day. Average liquids price dropped 2 percent year-over-year to $100.4 per barrel.

Further, Statoil said its Board of Directors proposed an increased dividend of 7 kronor in 2013 from 6.75 kronor in 2012. The Board will also propose to introduce quarterly dividend payments. Once approved, Statoil in 2014 would distribute two quarterly dividends in addition to the annual dividend for 2013.

The company also said it intends to use share buy-backs more actively going forward.

Statoil will announce its updated outlook for 2014-16 at its capital markets update in London Today.

In the 2014-16 period, production growth is estimated around 2 percent 2013-14 and around 3 percent organic CAGR from 2013-16 from a rebased equity production of 1,850 mboe per day in 2013. The company expects to drill around 50 wells in 2014 and around 20 high impact wells from 2014-16.

At the Capital Markets Update, Statoil presents its plan for reduced capital expenditure by more than $5 billion from 2014-16 compared to previous plans. The company said it will invest around $20 billion on average per year 2014-16, a reduction of 8 percent from previous estimates, mainly due to strict prioritisation and increased capital efficiency.

The company also said it expects to deliver around 3 percent average rebased organic production growth from 2013-16. Statoil would realise annual savings of $1.3 billion per year from 2016 through a comprehensive improvement program

According to the company, safe and efficient operations, strict prioritisation, and predictable and competitive development of a strong resource base will enable profitable growth through 2020 and beyond.

Statoil shares closed Thursday's trading at $23.94, up $0.32 or 1.35 percent.