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We have made a good progress on our development projects in particular taken the FID Samburskoyes in the Yamal Peninsula putting us on track for start up in ’12. Just to give you an update on gas renegotiations Sonatrach has been positive and we are close to reaching mutually satisfactory conclusion. Our discussion we guess from progression and we had seen evidence of an increasingly constructive value. While it is difficult to be deterministic about the timing of the deal we remain confidence about the outcome. But now let me give you a detail of the review of our Q3 results.In the third quarter of ’11 the macro environment was mainly positive. The brand price average $113 a barrel up 48% compared to the third quarter of ’10. Mean while the average European refining margin Brent/Ural was $249 per barrel still weak compared to historical level, but showing an 18% increase year-over-year. As euro dollar exchange rate move unfavorably compared to the corresponding period of last year with the euro appreciating 10% versus the dollar. Moving to our results, adjusted operating profit in the third quarter amounted to €4.6 billion euro, up 12% year-on-year. This result is due to the improved performances of the exploration and production, engineering and construction, and the refining and marketing business partially offset by the lower contribution of the gas and power division, we doesn't reflect any benefits from gas contract renegotiation and (inaudible) results of the petrochemical businesses. Adjusted net profit for the third quarter was €1.4 billion, up 7% year-on-year. Not with standing a higher adjusted tax rate up by only more than 7 percentage point to 57.6%. The recent upward revision of the so-called Robin Tax decrease in net profit €130 million in the third quarter of which €80 prepayment to the first half of ’11.
In the third quarter of ’11, Eni's hydrocarbon production amounted to 1,473,000 barrels of oil equivalent per day, a decrease of about 14% compared to the Q3 ’10. The over production was mainly due to the ongoing instability in Libya, which reduced the production by approximately 2,000 BOE per day.Furthermore PSA entitlements were negatively affected by the sharp increase in the oil price with an estimated impact of 37,000 BOE per day. The increase in the oil price however boosted the division’s adjusted operating profit, which amounted to over €3.9 billion euro, up 19% compared to the second quarter of last year. This positive result comes in spite of the negative impact of the US dollar depreciation amounted to around €200 million euro in the quarter. In gas and power, overall gas volumes sold including consolidated and associated companies totaled 17.3 bcm roughly align with last year. However, adjusted operating profit decreased by 20% compared to the same period of ’10 due to the sharply lower results delivered by the marketing business. It’s worth reminding you that the results do not include any benefits from their renegotiation of our long-term supply concepts although this will be reflective once the agreements are finalized. Gas and power adjusted pro forma EBITDA for the third quarter of ’11 was €550 million compared to €675 million euro in the third quarter of last year. International transportation results showed a 4% decrease while the regulated businesses generated €388 million, up 5% versus the corresponding period of last year. The increase is mainly due to higher returns of on the new investments and efficiency actions as well as the positive impact on the distribution business on the new tariff regime set by the Authority for Electricity and Gas. Adjusted pro forma EBITDA in the marketing and power business was negatively impacted by increasing competitive pressure in Italy and Europe, as well as unfavorable climate and scenario affects. Furthermore, the ongoing situation in Libya reduced volumes to shippers and the affected margins owing to the substitution of recently renegotiated Libyan gas with other sources of supply not yet renegotiated. These negatives were partially offset by the positive outcome of this renegotiation of our long term supply contract with the Netherlands. Read the rest of this transcript for free on seekingalpha.com