Eni SpA E reported third-quarter 2024 adjusted earnings from continuing operations of 86 cents per American Depository Receipt, which missed the Zacks Consensus Estimate of 89 cents. The bottom line declined from the year-ago quarter’s $1.18.
Total quarterly revenues of $23.1 billion declined from $24.7 billion a year ago. The top line also missed the Zacks Consensus Estimate of $23.4 billion.
The company’s weak quarterly results were driven by lower throughputs and lower average liquids price realization. Additionally, retail gas sales and biofuel margins deteriorated, adversely impacting its overall performance.
Eni SpA Price, Consensus and EPS Surprise
Eni SpA Price, Consensus and EPS Surprise
Eni SpA price-consensus-eps-surprise-chart | Eni SpA Quote
Operational Performance
Eni operates through four business segments — Exploration & Production, Global Gas & LNG Portfolio, Enilive Refining and Chemicals, and Plenitude & Power.
Exploration & Production
Total oil and gas production in the third quarter was 1,661 thousand barrels of oil equivalent per day (MBoe/d), up 2% from 1,635 in the prior-year quarter.
Liquids’ production totaled 775 thousand barrels per day (MBbl/d), up 2% from the year-ago quarter’s 758 MBbl/d. Natural gas production increased to 4,638 million cubic feet per day from 4,590 a year ago.
The average realized price of liquids was $73.88 per barrel, down from $79.13 reported a year ago. The realized natural gas price was $7.34 per thousand cubic feet, up 8% from $6.79 in the year-ago period.
Lower average liquids price realization affected the company’s Exploration & Production segment. The segment reported a pro-forma adjusted EBIT of €3.2 billion, down 5% from €3.4 billion in the September-end quarter of 2023.
Global Gas & LNG Portfolio
Eni’s worldwide natural gas sales in the reported quarter totaled 10.79 billion cubic meters (bcm), down 1% year over year from 10.91 bcm.
The integrated energy major’s Global Gas & LNG Portfolio business segment reported a pro-forma adjusted EBIT of €253 million, a significant increase of 65% from the year-ago quarter’s €153 million. The upside was driven by a more favorable trading environment and the positive outcome of a negotiation or settlement.
Refining, Chemicals & Power
For the third quarter, total refinery throughputs were 5.97 million tons (mmtons) compared with 7.07 in the corresponding period of 2023. Petrochemical product sales increased 6% year over year to 0.81 mmtons.
For the quarter under review, the segment reported a pro-forma adjusted negative EBIT of €129 million against a pro-forma adjusted EBIT of €274 million in the year-ago quarter. The deterioration can be attributed to weaker refining margins and lower throughputs.
Enilive & Plenitude
Retail gas sales managed by Plenitude declined 8% year over year to 0.49 bcm.
The company reported a pro-forma adjusted EBIT of €317 million from this segment, marking a 32% year-over-year decrease. This can be attributed to deteriorating biofuel margins.
Financials
As of Sept. 30, Eni had a long-term debt of €21.9 billion, and cash and cash equivalents of €9.4 billion.
For the reported quarter, net cash generated by operating activities was €3 billion. Capital expenditure totaled €2 billion.
Outlook
For 2024, the company anticipates hydrocarbon production in the exploration and production segment to be 1.70 million barrels of oil equivalent per day range, based on an updated Brent price of $83 per barrel. The metric indicates an increase from the year-earlier figure of 1.66 million barrels of oil equivalent per day.
Zacks Rank & Stocks to Consider
Eni currently has a Zack Rank #5 (Strong Sell).
Investors interested in the energy sector may look at some better-ranked stocks that currently carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Williams Companies, Inc. WMB is a premier energy infrastructure provider in North America. The company’s core operations include finding, producing, gathering, processing, and transporting natural gas and natural gas liquids. Boasting a widespread pipeline system of more than 33,000 miles, Williams is one of the largest domestic transporters of natural gas by volume.
The Zacks Consensus Estimate for WMB’s 2024 EPS is pegged at $1.75. The company has witnessed upward earnings estimate revisions for 2024 and 2025 in the past seven days.
Viper Energy, Inc. VNOM is a variable distribution MLP based in Midland, TX. It generates strong and steady royalty income from mineral interests in Eagle Ford and the Permian Basin. The business strategies of the partnership include acquiring mineral interests from third parties and the parent company.
The Zacks Consensus Estimate for VNOM’s 2024 EPS is pegged at $2.03. The company has witnessed upward earnings estimate revisions for 2024 and 2025 in the past seven days.
Helmerich & Payne HP is primarily involved in the contract drilling of oil and natural gas, with operations in all major U.S. onshore basins, as well as South America, Australia and the Middle East. In the past few months, the company has secured eight rig contracts with Saudi Aramco, expanding its presence in the Middle East. With plans to capitalize on unconventional drilling growth opportunities, HP’s outlook seems positive.
The Zacks Consensus Estimate for HP’s 2024 EPS is pegged at $3.53. The company has witnessed upward earnings estimate revisions for 2024 and 2025 in the past 30 days.
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