TotalEnergies has announced a record profit for the third quarter, observers believe the company is reaping hugely from high energy prices and soaring prices of LNG in Europe as players in the region scramble to procure gas ahead of the winter.
The French multinational reported yesterday an adjusted net income of $9.9billion for the third quarter, more than double the adjusted earnings for Q3 2021 and a record for the company.
The company said net income stood at $6.6 billion after taking into account a new impairment of $3.1billion related to Russia. Despite the impairment, the net income in Q3 was still 43% higher than in the same period of 2021.
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Cash flow from operations more than tripled to $17.8 billion compared to the third quarter of last year.
TotalEnergies’ Integrated Gas, Renewables & Power segment reported a record-setting adjusted net operating income of $3.6 billion for the third quarter, up by $1.1 billion from the second quarter, and cash flow of $2.7 billion, “driven by an average LNG selling price up more than 50% compared to the previous quarter and by the strong performance of its trading activities.”
The downstream business was also very strong, TotalEnergies said. “Downstream benefited from strong distillate margins, generating an outstanding adjusted net operating income of $2.4 billion and a cash flow of $2.9 billion,” the supermajor noted.
Also yesterday, Shell announced a strong Q3 earnings despite weaker trading in gas compared to the records of the second quarter.
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The multinational said it intends to lift its dividend and is launching a new share buyback program after reporting its second-highest quarterly earnings for Q3, second only to the record profit for the previous quarter.
Shell is the world’s top LNG trader while TotalEnergies is the second-largest, yet Shell appear not to have benefited from the natural import boom in Europe due to its weaker trading results.
Analysts say, nevertheless, it is yet another very profitable and record-breaking quarter for Big Oil, enough to could convince EU policymakers that windfall taxes on the largest energy firms could help pay for government support to consumers’ soaring energy bills.
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