Repsol Tops Forecast as Higher Output Offsets YPF Loss
Spanish oil firm Repsol beat third-quarter profit forecasts on Thursday as higher output more than offset the loss of its YPF business in Argentina, which was seized by the government there earlier this year.
Argentine President Cristina Fernandez took over Repsol's majority stake in YPF in April, accusing the Spanish oil company of investing too little and making Argentina increasingly reliant on pricey fuel imports..
Repsol recovered from the loss of YPF in the third quarter, posting an 89% rise in net profit adjusted for one-time items and inventory costs to €496 million ($633 million) from 262 million on a proforma basis a year ago.
This compares with the €429 million third-quarter net profit it posted last year when it still had majority control of YPF.
The company's upstream division, including exploration and production, drove profits thanks to a recovery in output in Libya and an additional pick-up in Bolivia, fuelling a 9% rise in output to 327,000 barrels of oil per day in the nine months to September from a year ago.
Strength from its liquefied natural gas (LNG) business and higher margins in its traditional refining business in Spain also helped boost third quarter results, the company said, compensating for weakness in its chemicals division.
Clean CCS earnings before interest and tax (EBIT), which exclude special items and inventory holding effects, rose 64% to €1.3 billion in the third quarter versus a Reuters poll average of 1.1 billion.
Repsol, whose shares have lost 32% so far this year, has said it will sell LNG assets to cut debt and maintain a coveted investment grade rating while still investing in its growing production business.
