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TotalEnergies (TTE) Q2 Earnings Beat Estimates, Sales Up Y/Y

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TotalEnergies SE (TTE - Free Report) reported second-quarter 2021 operating earnings of $1.27 (€1.06) per share, beating the Zacks Consensus Estimate of $1.16 by 9.5%.

The bottom line also substantially rose from the year-ago figure of 2 cents (€0.02) per share. This year-over-year improvement was due to an increase in commodity prices, its strategy of boosting liquefied natural gas (LNG) production, and focus on renewables as well as clean electricity generation.

Total Revenues

Total revenues came in at $47.04 billion, up 82.8% from $25.73 billion generated in the year-ago quarter.

Production

Second-quarter hydrocarbon production averaged 2,747 thousand barrels of oil equivalent per day (kboe/d), down 3% year over year. This was due to planned maintenance, unplanned outages and natural decline in the fields, offset by production from startups and ramp-up of projects.

For the reported quarter, liquids production averaged 1,464 thousand barrels per day, down 6% from the year-ago period.

Quarterly gas production was 7,017 thousand cubic feet per day, down marginally year over year due to decreased gas output from the Europe and Central Asia region as well as Africa.

Realized Price

Second-quarter realized price for Brent was up 133.1% to $69 per barrel from $29.6 in the year-ago period. The average realized liquid price was $62.9 per barrel, up 168.8% from the year-ago figure.

Realized gas prices improved 69.7% from the prior-year quarter to $4.43 per thousand British thermal units (Btu).

Realized LNG prices improved 49.8% from the prior-year quarter to $6.59 per thousand Btu.

Highlights of the Release

Operating income was $4,032 million, up 391.1% from the year-ago period due to higher commodity prices.

Interest expenses for the reported quarter were $501 million, down 5% from $527 million in the year-ago period.

In second-quarter 2021, TotalEnergies acquired $662 million worth of assets and sold assets valued at $226 million. During the quarter, it acquired a 23% interest in a 640-MW offshore wind project in Taiwan, which further expanded its clean energy generation capability.

Segment Details

Exploration & Production’s operating earnings were $2,213 million against a loss of $209 million in the year-ago period.

Integrated Gas, Renewable & Power’s operating income was $891 million, up 173.3% from $326 million in the year-ago quarter.

Refining & Chemicals’ operating income was $511 million, down 11.1% from $575 million in the year-ago quarter.

Marketing & Services’ operating income was $417 million, up 223.3% from $129 million in second-quarter 2020.

Financial Update

Cash and cash equivalents as of Jun 30, 2021 were $28.6 billion compared with $29.7 billion in the corresponding period of 2020. Net debt to capital was 22.9% at quarter-end, down from 27.6% at second quarter 2020-end.

Cash flow from operating activities at second quarter-end was $7,551 million, down 117% year over year.

Guidance

TotalEnergies, taking into consideration the OPEC quotas, expects total production to be 2,850 Kboe/d. The company expects start-ups and ramp-up of new projects in Angola, Russia and Brazil to contribute to higher production in second-half 2021.

It expects the positive movement in commodity prices to continue in second-half 2021 and further increase the realized prices of LNG.

TotalEnergies expects to invest in the range of $12-$13 billion in 2021. Nearly 50% of the planned growth investment will be directed to expand its renewable and clean electricity generation operations.

Zacks Rank

Currently, TotalEnergies carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Upcoming Releases

Chevron Corporation (CVX - Free Report) is scheduled to release second-quarter 2021 results on Jul 30, before the opening bell. The Zacks Consensus Estimate for the quarter’s earnings is pegged at $1.54 per share.

Exxon Mobil Corporation (XOM - Free Report) is scheduled to release second-quarter 2021 results on Jul 30, before the opening bell. The Zacks Consensus Estimate for earnings for the quarter is pegged at $1.02 per share.

Enbridge Inc. (ENB - Free Report) is scheduled to release second-quarter 2021 results on Jul 30, before the opening bell. The Zacks Consensus Estimate for quarterly earnings is pegged at 44 cents per share.