Total rebrands in pivot away from oil after better quarter

By Benjamin Mallet and Sarah White PARIS (Reuters) - France's Total posted better than expected earnings in the fourth quarter as oil prices stabilised, and said it would change its name as part of a push to diversify and grow renewable power and electricity production.

Reuters February 10, 2021 00:06:49 IST
Total rebrands in pivot away from oil after better quarter

Total rebrands in pivot away from oil after better quarter

By Benjamin Mallet and Sarah White

PARIS (Reuters) - France's Total posted better than expected earnings in the fourth quarter as oil prices stabilised, and said it would change its name as part of a push to diversify and grow renewable power and electricity production.

The French oil and gas major, which like rivals suffered in 2020 as fuel consumption tumbled during the pandemic, said it would rebrand as TotalEnergies as it tries over the next decade to reduce oil products to a third of its sales from over half now.

The company plunged to a $7.2 billion net loss for 2020 as a whole, hit by around $10 billion of impairments as oil prices collapsed. But it had already recorded most of the charges, including some linked to write downs on its Canadian oil sands assets, in the first half of last year and on an adjusted basis, net income came in at $4.06 billion for the year.

Earnings fell less sharply in the fourth quarter than in the previous three months. Adjusted net income, which strips out some one off items, was down 59% from the year earlier period to $1.3 billion, beating analysts' expectations, and in contrast with some peers including Shell.

"Overall a rock steady performance in a tough quarter and year," analysts at Bernstein said in a note, adding that cash flow levels were strong.

Total shares were up 1.2% by 1055 GMT.

Chairman and Chief Executive Patrick Pouyanne said the company's rebranding reflected a bid to move as fast as possible as it tries to improve on its environmental goals.

"By proposing this name change to shareholders, we're also fundamentally asking them to approve this change in strategy," Pouyanne told reporters.

The group said it has already spent more than $2 billion on acquisitions in the renewables sector this year, and planned to spend 20% of its investment budget for 2021 on this drive, up from around 15% in 2020.

Total will have some $5 billion of investments to finance overall in the renewables segment this year, with a mixture of debt and capital, Pouyanne said, and some $60 billion by 2030.

Total said the oil market outlook remained uncertain, and it would target another $500 million in cost cuts in 2021, after saving $1.1 billion last year.

It is targeting $12 billion in net investments overall this year, down from $13 billion last year.

Total forecast a 10% improvement in sales of liquefied natural gas this year, in part thanks to a ramp up of operations at the Cameron LNG export plant in the United States.

It also on Tuesday signed a fiscal stability agreement with Papua New Guinea which could pave the way for work to begin on a long-stalled LNG project in the country.

Total said it would propose a dividend payout of 0.66 euros per share for the October to December period, in line with previous quarters in 2020.

(Reporting by Benjamin Mallet and Sarah White; editing by Jason Neely, Kirsten Donovan)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

also read

France, Germany to agree to NATO role against Islamic State - sources
| Reuters
World

France, Germany to agree to NATO role against Islamic State - sources | Reuters

By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States

China's Xi says navy should become world class
| Reuters
World

China's Xi says navy should become world class | Reuters

BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.