Eni S.p.A. (E - Free Report) delivered fourth-quarter 2018 adjusted earnings from continuing operations of 94 cents per American Depository Receipt/ADR, which beat the Zacks Consensus Estimate of 73 cents. The company generated earnings of 64 cents in the year-earlier quarter. The improvement can be attributed to higher liquids production and realized prices.
Total revenues in the quarter were $22,885 million, down from $24,592 million in the year-ago quarter and $23,144 million in third-quarter 2018. The downside was caused by lower gas production.
Total liquids and gas production in the fourth quarter was 1,872 thousand barrels of oil equivalent per day (MBoe/d), down 1.1% year over year. The downtick stemmed from decline in gas demand. This was offset by increase in production, which can be attributed to project start-ups in Angola, Ghana, Egypt and Kazakhstan.
Liquids production was 897 thousand barrels per day (MBbl/d), up 4.2% from the year-ago quarter’s level of 861MBbl/d. Natural gas production fell 5.4% year over year to 5,321 million cubic feet per day (MMcf/d).
Realized price of oil was $61.22 per barrel, up 6.2% from the year-ago quarter’s figure of $57.64 per barrel. Realized natural gas price was $6.11 per thousand cubic feet (Mcf), up 57.5% from $3.88 in the year-ago quarter.
Gas sales were 18.72 billion cubic meters (Bcm), down 12.8% from the year-ago quarter’s tally. The decline was caused by lower sales in Italy, Germany, Austria, Turkey and France.
As of Dec 31, 2018, the company had long-term debt (including current portions) of €20.1 billion. The debt-to-capitalization ratio was 28.2%.
In the reported quarter, net cash generated by operating activities amounted to €4.3 billion. Capital expenditure totaled €2.9 billion.
Adjusted net proved reserves till 2018 was 7,153 million barrels of oil equivalent, which reflects reserves replacement ratio of 124%.
Zacks Rank & Key Picks
Eni carries a Zacks Rank #4 (Sell). Investors interested in the energy sector can opt for some better-ranked stocks as given below:
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San Antonio, TX-based NuStar Energy L.P. (NS - Free Report) is a midstream energy company. For 2019, its bottom line, which has witnessed three upside revisions over the past 30 days, is expected to grow 64.2% year over year. The company currently holds a Zacks Rank #2.
Madrid, Spain-based Repsol, S.A. (REPYY - Free Report) is an integrated energy company. Its bottom line for 2019 is expected to increase 13.7% year over year. The company delivered average positive earnings surprise of 9% in the trailing four quarters. The stock currently has a Zacks Rank #2 (Buy).
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