Norway's Statoil ASA (STL.OS) posted a forecast-beating second-quarter net profit Thursday, driven by higher oil prices and continued further cuts to its operating costs.
The 67% state-owned company posted a net profit for the three months through June 30 of $1.43 billion, compared with a loss of $307 million a year earlier. Analysts had expected a net profit of $1.17 million. Revenue rose 37% on the year to $14.86 billion, against expectations of $13.86 billion.
Statoil's adjusted earnings before interest and taxes, which excludes one-off items to show the company's underlying performance, rose to $3.20 billion, against analysts' expectations of $2.91 billion. Higher prices for both oil and gas, high production, a reversal of provisions in Angola of $754 million and continued progress on improvement work contributed to the increase, it said.
The company maintained its quarterly dividend at $0.2201 a share.
"Our solid financial results and strong cash flow are driven by good operational performance with high production efficiency and continued cost improvements," said Chief Executive Eldar Saetre.
"We expect to deliver around 5% production growth this year, and at the same time realise an additional $1 billion dollars in efficiencies," says Eldar Saetre, President and CEO of Statoil ASA.
Capital expenditure in 2017 is still expected to remain at the 2016 level of around $11 billion, while exploration expenses are now seen at around $1.3 billion, from a previous estimate of around $1.5 billion, excluding signature bonuses.
"We expect to drill around 30 exploration wells in 2017. Based on strict prioritisation and efficient drilling operations we are able to reduce our guidance for exploration spending this year to around $1.3 billion," Mr. Saetre added.
Statoil expects around 5% production growth in 2017, from an earlier estimate of 4%-5%, but the organic annual production growth target of around 3% from 2016 to 2020 is unchanged.
Write to Dominic Chopping at firstname.lastname@example.org; Twitter: @domchopping @WSJNordics
(END) Dow Jones Newswires
July 27, 2017 02:35 ET (06:35 GMT)