(AOF) – The TotalEnergies share (-2.64% to 58.71 euros) occupies the place of the red lantern of the CAC 40 index due to a disappointing performance in the fourth quarter, even if it shows results historic in 2023. The French group also suffers from the comparison with its competitor BP, which revealed higher profits than expected on Tuesday. TotalEnergies had also benefited from it on the stock market. UBS remains Buy on TotalEnergies shares, maintaining its price target at 67 euros.
Record annual net profit
TotalEnergies’ 2023 adjusted net income stood at $23.2 billion, down 36%, or $9.40 per share (down 33% over one year). 2023 adjusted Ebitda fell 50% to $50 billion.
However, the oil group posted a record annual net profit of $21.38 billion, an increase of 4%. In 2022, the company had recorded a net profit of $20.53 billion. This increase in net profit is due to “the growth of hydrocarbons, in particular LNG, and electricity”, specifies TotalEnergies.
Regarding these performances in the fourth quarter, the company recorded an adjusted net income of $5.2 billion, down 19%. It is 1% lower than the consensus of $5.3 billion and the UBS forecast of $5.5 billion.
Over this same period, its adjusted EBITDA amounted to $10.7 billion, down 10%.
Its cash flow of $8.5 billion fell 9%. It is 1% below Visible Alpha’s consensus of $8.6 billion. UBS forecast cash flow of $9.8 billion.
Oil & Gas production for the fourth quarter stood at 2.46 million barrels of oil equivalent per day (Mboe/d), benefiting from an increase in LNG production of 7% over the quarter. In the context of a falling Brent price, Exploration-Production had a solid quarter, with adjusted net operating income of $2.8 billion and cash flow of $4.7 billion.
Over the year 2023, the company repurchased $9 billion worth of shares, including $1.5 billion related to the proceeds from the sale of Canadian assets. It continued to reduce its net debt to $6 billion for a debt ratio of 5%, benefiting from an improvement in working capital of $5 billion.
Increased dividend and share buyback
In addition to these results, the board of directors, meeting on February 6, 2024, decided to propose the distribution of a dividend in 2023 of 3.01 euros per share, an increase of 7.1%.
In addition, “the board of directors confirms its shareholder return policy of more than 40% of cash flow for 2024, which will combine an increase in interim dividends from 6.8% to 0.79 euros per share and $2 billion in share repurchases in the first quarter, a level that will remain the basis for quarterly repurchases in the current environment.”
Outlook-wise, capex is expected to be in the upper half of the long-term range in 2024, at $17-18 billion. This amount is higher than UBS’s estimate: $16.8 billion and the $16 billion consensus.
Production is expected to be above 2.4 Mboe/d in the first quarter of 2024 (slightly lower than UBS’s forecast: 2.47 Mboe/d) and increase by 2% year-on-year for fiscal 2024, after adjusting for Canadian sale (compared to +3% according to UBS).
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