By America Hernandez

TotalEnergies Reports Low Third-Quarter Income

PARIS (Reuters) – French oil major TotalEnergies (EPA:TTEF) reported its third-quarter adjusted net income at a three-year low of $4.1 billion on Thursday, slightly missing expectations due to refining margins and upstream outages that impacted earnings.

Adjusted net income was down 37% from a year earlier and 12.7% lower than the previous quarter's $4.7 billion. This result just missed analyst expectations of $4.2 billion.

Adjusted earnings before interest, tax, depreciation, and amortization (EBITDA) fell 23.6% year on year to $10 billion.

Earlier this month, TotalEnergies warned that its financial performance would be affected as its margin for converting crude oil into refined fuels plummeted 65%.

Global refining margins have sharply declined in recent months, impacted by weaker economies and the launch of several new refineries in Asia and Africa, while oil prices fell 17% during the quarter — the largest quarterly decline in a year — due to concerns over global oil demand.

TotalEnergies shares decreased 1.5% in early trading.

RBC analyst Biraj Borkhataria noted that Total reported weaker cash generation relative to expectations, adding that while divisional estimates were broadly in line with consensus, estimates had been declining following a recent trading update.

The company confirmed $2 billion in share buybacks for the fourth quarter and announced a third interim dividend of 0.79 euros per share for 2024.

In addition to an 83% drop in quarterly refining and chemicals division profits year-on-year, Total's integrated LNG division also made 21% less than in the third quarter last year, citing low gas market volatility as a hindrance to trading profits. Integrated power, which includes renewables, saw a 4% decline from a year ago.

TotalEnergies reported a $1.1 billion impairment due to the August bankruptcy filing of U.S. subsidiary SunPower (OTC:SPWRQ) and its exit from several South African offshore blocks.

Quarterly hydrocarbon production of 2.4 million barrels of oil-equivalent per day was at the low end of guidance provided at the half-year mark due to security-related disruptions in Libya and an outage at the Ichthys LNG plant in Australia.