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Eni (E) Beats Q2 Earnings Estimates on Higher Production

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Integrated energy company Eni SpA (E - Free Report) reported second-quarter 2017 adjusted earnings from continuing operations of 27 cents per American Depositary Receipt, beating the Zacks Consensus Estimate of 9 cents. In the year-earlier quarter, the company reported adjusted loss of 27 cents.

Total revenue in the quarter jumped 15.1% to €15,784 million ($17.4 billion) from €13,711 million ($15.2 billion) in the year-ago quarter.

Higher production along with increased oil and gas prices realizations led to the growth, which was partially offset by low gas sales.
 

ENI S.p.A. Price, Consensus and EPS Surprise

 

ENI S.p.A. Price, Consensus and EPS Surprise | ENI S.p.A. Quote

Operational Performance

Total liquids and gas production in the second quarter was 1,771 thousand barrels of oil equivalent per day (MBoe/d), up 3.3% year over year.

Liquids production was 827 thousand barrels per day (MBbl/d), down 3% from the year-ago level of 852 MBbl/d. However, natural gas production jumped 9.4% year over year to 5,152 million cubic feet per day (MMcf/d).    

Realized price of oil was $45.29 per barrel, up 11.6% from the year-ago realized price of $40.58. Realized natural gas price was $3.45 per thousand cubic feet (kcf), up 10.9% from $3.11 in the year-ago comparable quarter.  

Gas sales were 18.63 billion cubic meters (Bcm), down 9% from the year-ago quarter sales of 20.48 Bcm.

Financials

As of Jun 30, the company had long-term debt of €20 billion. The debt-to-capitalization ratio was 29%.   

In the reported quarter, net cash generated by operating activities from continuing operations amounted to €2.7 billion. Capital expenditure totaled €2.2 billion.

Outlook

Eni expects oil and natural gas production in 2017 to be 1.84 million (BOE/D), higher by 5% year over year. The company also projects discovery of 0.8 billion BOE of new resources in 2017.

The company expects full-year capital spending to decline 18% from the year-ago comparable quarter. Also, total debt level for 2017 is anticipated to decline from the previous year.

Q2 Price Performances

The pricing chart reveals that the company’s shares have underperformed the industry in the April–June quarter of this year. During this period, the company’s shares have lost 8.2%, while the industry decreased 5.5%.

Zacks Rank

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

Some other stocks in the same space include Global Partners LP (GLP - Free Report) , Braskem S.A. (BAK - Free Report) and TransCanada Corp (TRP - Free Report) .

Global Partners delivered a positive earnings surprise of 1200.00% in the preceding quarter. The company beat estimates in three of the trailing four quarters with an average positive earnings surprise of 415.30%.

Braskem delivered a positive earnings surprise of 107.79% in the quarter ending September 2016.

TransCanada reported a negative earnings surprise of 7.58% in the preceding quarter. It surpassed estimates in two of the trailing four quarters with an average positive earnings surprise of 1.06%.

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