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Eni (E) Stock Declines 2.1% Despite Posting Q1 Earnings Beat
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Eni SpA (E - Free Report) shares have declined 2.1% despite reporting strong results for the first quarter of 2022.
Despite the strong first-quarter results, the stock’s underperformance is expected to have resulted from the declining fundamentals of the company due to the year-over-year decline in production and profitability.
Eni reported first-quarter 2022 adjusted earnings from continuing operations of $2.04 per American Depository Receipt (ADR), beating the Zacks Consensus Estimate of $1.56. The bottom line significantly improved from the year-ago quarter’s 10 cents per ADR.
Total revenues in the quarter were $33,794 million, up from $17,839 million a year ago.
The strong quarterly results were attributed to higher realizations of average liquids and natural gas prices.
The company operates through four business segments — Exploration & Production, Global Gas & LNG Portfolio, Refining & Marketing and Chemicals, and Plenitude & Power.
Exploration & Production
Total oil and gas production in the first quarter was 1,654 thousand barrels of oil equivalent per day, down 3% year over year.
Liquids production was 780 thousand barrels per day (MBbl/d), down 4% from the year-ago level of 814 MBbl/d. Natural gas production dropped 2% year over year to 4,638 million cubic feet per day.
The average realized price of liquids was $93.86 per barrel, up 64% from $57.23 reported a year ago. Realized natural gas price was $10.69 per thousand cubic feet, up 135% from $4.55 a year ago.
Higher realizations of average liquids and natural gas prices aided the company’s Exploration & Production segment. The segment reported a profit of €4,381 million, which skyrocketed from €1,378 million recorded in the March-end quarter of 2021.
Global Gas & LNG Portfolio
Eni’s worldwide sales of natural gas for the March-end quarter were recorded at 18.26 billion cubic meters (bcm), up 4% year over year.
The integrated energy major’s Global Gas & LNG Portfolio business segment reported an adjusted operating profit of €931 million, turning around from the year-ago loss of €30 million. Higher sales volumes and the continuous initiatives of portfolio optimization aided the segment.
Refining & Marketing and Chemicals
For the March-end quarter, total refinery throughputs were recorded at 6.07 million tons (mmtons), down 5% year over year. Petrochemical product sales declined 4% year over year to 1.13 mmtons for the first quarter of 2022.
For the quarter under review, the segment reported an adjusted loss of €91 million, narrower than the loss of €120 million in the year-ago quarter primarily due to higher production in the Refining and Marketing segment.
Plenitude & Power
Retail gas sales, managed by Plenitude, declined 3% year over year to 3.42 bcm. Power sales in the open market declined 11% year over year.
Overall, from Plenitude & Power, the company reported a profit of €185 million, reflecting an 8% year-over-year decline.
Financials
As of Mar 31, Eni had long-term debt of €23,131 million, and cash and cash equivalents of €13,464 million. Its debt to capitalization was 38.7%.
For the reported quarter, net cash generated by operating activities amounted to €3,098 million. Capital expenditure totaled €1,364 million.
Outlook
For 2022, Eni expects total hydrocarbon production of 1.7 million boe/d. The company projects its 2022 cash flow from operations, before changes in working capital at replacement cost, to grow to €16 billion.
Moreover, the integrated energy major projects its organic capital expenditure for the year at €8 billion.
Zacks Rank & Other Stocks to Consider
The company currently carries a Zacks Rank #3 (Hold).
Investors interested in the energy sector might look at the following stocks that reported solid first-quarter earnings numbers and presently sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Hess Corporation (HES - Free Report) reported first-quarter 2022 earnings per share of $1.30, beating the Zacks Consensus Estimate of $1.12. The higher commodity price realizations backed the strong quarterly results.
As of Mar 31, 2022, Hess had $1,370 million in cash and cash equivalents. Its long-term debt was recorded at $7,934 million at the first-quarter end. The current maturity of the long-term debt is $22 million.
EOG Resources, Inc. (EOG - Free Report) reported first-quarter 2022 adjusted earnings per share of $4.00, beating the Zacks Consensus Estimate of $3.69. Strong earnings were driven by higher oil equivalent production and commodity prices.
As of Mar 31, EOG Resources had cash and cash equivalents of $4,009 million. Long-term debt was $3,816 million. EOG announced a special dividend of $1.80 per share. The special dividend is likely to be paid out on Jun 30 to stockholders of record as of Jun 15.
Equinor ASA (EQNR - Free Report) reported first-quarter adjusted earnings per share of $1.60, beating the Zacks Consensus Estimate of $1.57. The strong quarterly results were aided by higher commodity prices and increased contributions from the Martin Linge oil field.
As of Mar 31, 2022, Equinor reported $20,882 million in cash and cash equivalents. The company’s long-term debt was $27,493 million at the first-quarter end.
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Eni (E) Stock Declines 2.1% Despite Posting Q1 Earnings Beat
Eni SpA (E - Free Report) shares have declined 2.1% despite reporting strong results for the first quarter of 2022.
Despite the strong first-quarter results, the stock’s underperformance is expected to have resulted from the declining fundamentals of the company due to the year-over-year decline in production and profitability.
Eni reported first-quarter 2022 adjusted earnings from continuing operations of $2.04 per American Depository Receipt (ADR), beating the Zacks Consensus Estimate of $1.56. The bottom line significantly improved from the year-ago quarter’s 10 cents per ADR.
Total revenues in the quarter were $33,794 million, up from $17,839 million a year ago.
The strong quarterly results were attributed to higher realizations of average liquids and natural gas prices.
Eni SpA Price, Consensus and EPS Surprise
Eni SpA price-consensus-eps-surprise-chart | Eni SpA Quote
Operational Performance
The company operates through four business segments — Exploration & Production, Global Gas & LNG Portfolio, Refining & Marketing and Chemicals, and Plenitude & Power.
Exploration & Production
Total oil and gas production in the first quarter was 1,654 thousand barrels of oil equivalent per day, down 3% year over year.
Liquids production was 780 thousand barrels per day (MBbl/d), down 4% from the year-ago level of 814 MBbl/d. Natural gas production dropped 2% year over year to 4,638 million cubic feet per day.
The average realized price of liquids was $93.86 per barrel, up 64% from $57.23 reported a year ago. Realized natural gas price was $10.69 per thousand cubic feet, up 135% from $4.55 a year ago.
Higher realizations of average liquids and natural gas prices aided the company’s Exploration & Production segment. The segment reported a profit of €4,381 million, which skyrocketed from €1,378 million recorded in the March-end quarter of 2021.
Global Gas & LNG Portfolio
Eni’s worldwide sales of natural gas for the March-end quarter were recorded at 18.26 billion cubic meters (bcm), up 4% year over year.
The integrated energy major’s Global Gas & LNG Portfolio business segment reported an adjusted operating profit of €931 million, turning around from the year-ago loss of €30 million. Higher sales volumes and the continuous initiatives of portfolio optimization aided the segment.
Refining & Marketing and Chemicals
For the March-end quarter, total refinery throughputs were recorded at 6.07 million tons (mmtons), down 5% year over year. Petrochemical product sales declined 4% year over year to 1.13 mmtons for the first quarter of 2022.
For the quarter under review, the segment reported an adjusted loss of €91 million, narrower than the loss of €120 million in the year-ago quarter primarily due to higher production in the Refining and Marketing segment.
Plenitude & Power
Retail gas sales, managed by Plenitude, declined 3% year over year to 3.42 bcm. Power sales in the open market declined 11% year over year.
Overall, from Plenitude & Power, the company reported a profit of €185 million, reflecting an 8% year-over-year decline.
Financials
As of Mar 31, Eni had long-term debt of €23,131 million, and cash and cash equivalents of €13,464 million. Its debt to capitalization was 38.7%.
For the reported quarter, net cash generated by operating activities amounted to €3,098 million. Capital expenditure totaled €1,364 million.
Outlook
For 2022, Eni expects total hydrocarbon production of 1.7 million boe/d. The company projects its 2022 cash flow from operations, before changes in working capital at replacement cost, to grow to €16 billion.
Moreover, the integrated energy major projects its organic capital expenditure for the year at €8 billion.
Zacks Rank & Other Stocks to Consider
The company currently carries a Zacks Rank #3 (Hold).
Investors interested in the energy sector might look at the following stocks that reported solid first-quarter earnings numbers and presently sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Hess Corporation (HES - Free Report) reported first-quarter 2022 earnings per share of $1.30, beating the Zacks Consensus Estimate of $1.12. The higher commodity price realizations backed the strong quarterly results.
As of Mar 31, 2022, Hess had $1,370 million in cash and cash equivalents. Its long-term debt was recorded at $7,934 million at the first-quarter end. The current maturity of the long-term debt is $22 million.
EOG Resources, Inc. (EOG - Free Report) reported first-quarter 2022 adjusted earnings per share of $4.00, beating the Zacks Consensus Estimate of $3.69. Strong earnings were driven by higher oil equivalent production and commodity prices.
As of Mar 31, EOG Resources had cash and cash equivalents of $4,009 million. Long-term debt was $3,816 million. EOG announced a special dividend of $1.80 per share. The special dividend is likely to be paid out on Jun 30 to stockholders of record as of Jun 15.
Equinor ASA (EQNR - Free Report) reported first-quarter adjusted earnings per share of $1.60, beating the Zacks Consensus Estimate of $1.57. The strong quarterly results were aided by higher commodity prices and increased contributions from the Martin Linge oil field.
As of Mar 31, 2022, Equinor reported $20,882 million in cash and cash equivalents. The company’s long-term debt was $27,493 million at the first-quarter end.