By Stephanie Kelly, Shadia Nasralla and America Hernandez
LONDON/PARIS (Reuters) -Shell and TotalEnergies posted quarterly profit falls of 10% and 2%, respectively, on Thursday, dragged down by lower oil prices, though Shell beat expectations helped by better trading results in its huge gas division.
While Shell, the world’s largest liquefied natural gas trader, is keeping its $3.5 billion buyback pace, TotalEnergies said it would scale back in the fourth quarter, under pressure to keep a lid on its debt.
Shell’s buybacks have topped $3 billion for the last 16 quarters. By the end of the year, it will have bought back more than a quarter of its shares in four years.
The buybacks, together with $2.1 billion in dividends, take Shell’s shareholder payouts over the last four quarters to 48% of operating cash flow, within the company’s 40% to 50% target range.
Shell’s adjusted earnings, its definition of net profit, fell to $5.4 billion in the quarter to September 30 but beat the $5.09 billion expected by analysts in a poll provided by the company.
TOTALENERGIES PROFIT HELPED BY UPSTREAM, REFINING MARGINS
French major TotalEnergies’s adjusted net income slipped to $4.0 billion from $4.1 billion a year earlier.
That met analysts expectations according to a consensus compiled by LSEG, as higher upstream production and improved crude refining margins partially offset lower oil prices.
Shell’s shares were flat at 0925 GMT while TotalEnergies was down 2.2%. The index of European energy companies was off 0.7%.
SHELL’S GAS, UPSTREAM BUSINESSES BEAT EXPECTATIONS
Shell reported quarterly cash flow from operations of $12.2 billion, down from $14.7 billion a year earlier.
Profits at Shell’s integrated gas unit and oil-focused upstream division both beat expectations but were down from last year.
Total’s downstream results jumped by 76%. European margins on refining fuels have soared more than 300% buoyed by an EU ban on fuel imports made from Russian oil.
Shell’s gearing, or debt to equity ratio including leases, dipped slightly on the previous quarter but rose to around 19% from 16% last year.
TotalEnergies’ gearing including leases was down slightly quarter on quarter but up from 18% last year.
Brent futures averaged around $68 per barrel in the quarter, down from about $78 a year earlier, according to LSEG data and Reuters calculations.
The benchmark Dutch front-month gas contract at the TTF hub averaged 33.04 euros per megawatt hour in the quarter, down from 35.6 euros per MWh.
(Reporting by Stephanie Kelly, Shadia Nasralla and America Hernandez; editing by Jason Neely)
