Equinor jumps, Total edges lower on 4Q results

By Geoffrey Smith 

Investing.com -- TotalEnergies (EPA:TTEF) stock edged lower in Paris on Wednesday while Norwegian rival Equinor (OL:EQNR) soared in Oslo after the two giants added to a growing list of record profits for integrated oil and gas companies. 

The French major reported adjusted net income of $36.2 billion while Equinor generated $28B, both cashing in on the surge in oil and gas prices after Russia's invasion of Ukraine a year ago. 

Total wrote down its stake in gas producer Novatek (MCX:NVTK) by $4.1B in the fourth quarter, something that contributed to reported net profit coming in at only $20.5B, although that was still ahead of analysts' expectations. The French group announced a further $2B in buybacks in the current quarter and raised its dividend by over 6% to €2.81 a share, having already announced a special dividend of €1 (€1=$1.0775).

“While down from the previous quarter highs due to uncertainties about the demand outlook, fourth quarter oil and gas prices as well as refining margins remained strong in supply-constrained markets,” Total CEO Patrick Pouyanne said in a statement.

He added that the group expects to be able to keep returns flowing this year, expecting to pay out 35%-40% of profits. The quarterly dividend is expected to rise to 74c a share as a result.   

Equinor also raised its payouts sharply, bolstering its regular quarterly dividend by 50% to 30c, along with a series of 60c special dividends over the next four quarters - a total payout of around $11B. In addition, the company announced a buyback program of $4.8B this year on top of the $1.2B that it aims to buy back regularly every year.

The war in Ukraine had differing impacts on the two, however. While Total was hit by nearly $15B in write-offs for its extensive investments in Russia, Equinor enjoyed a windfall from its gas fields in the North Sea, which became indispensable as an alternative source of gas after Russia cut its exports during the summer. 

Equinor's gas output rose 8% on the year, while its oil output fell by 6%, leaving overall oil and gas output down 2% on the year at 2.04 million barrels of oil equivalent a day. It expects overall output to rise 3% this year.

Equinor makes most of its money in Norway, where its profits are taxed at a top rate of 78%. The company expects to pay almost $50B in taxes for last year.

By 04:30 ET (09:30 GMT), Equinor stock was up 6.2%, while TotalEnergies stock was down 1.8%.