Repsol beats forecasts because of excessive oil and fuel costs

MADRID, Feb 17 (Reuters) – Excessive oil and fuel costs helped Spain’s Repsol (REP.MC) to put up earnings above market expectations on Thursday, giving it extra monetary firepower to spend on low-carbon operations buyers are more and more demanding of power firms.

Benchmark Brent crude oil and Henry Hub fuel rose 70% and 86% respectively throughout 2021 as tight fuel provides collided with rising demand as economies recovered from COVID-19 shutdowns.

For Repsol, this translated right into a 70% annual enhance in free money circulation from operations to five.45 billion euros ($6.19 billion) for 2021.

Earnings beat forecasts supplied by the corporate, with adjusted web earnings at 872 million euros towards the corporate’s analyst consensus of 783 million euros.

Earnings earlier than curiosity, tax, depreciation and amortisation (EBITDA) at present price of provide hit 7.07 billion euros within the full yr, above the corporate’s goal of 6.7 billion euros.

In step with bigger rivals together with BP and TotalEnergies, Repsol is responding to regulatory and market strain to cut back planet-warming carbon emissions by investing in renewable power.

It plans to allocate 35% of investments between 2021 and 2025 to low-carbon actions. This plan consists of an try and promote a stake in its newly created renewable power technology unit. learn extra

Repsol additionally boosted its dividend 5% final autumn to 0.63 euros.

The corporate, in the meantime, has been grappling with an oil spill off the coast of Peru on Jan. 15, which it blamed on uncommon waves triggered by a volcanic eruption 1000’s of miles away in Tonga. learn extra

Repsol stated on Thursday that “intensive work” was below method to clear up the oil, which it estimated at 10,396 barrels. ($1 = 0.8800 euros)

Reporting by Isla Binnie
Enhancing by David Goodman

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