OMV's Profits Buoyed by Downstream Business
VIENNA, Feb 19 (Reuters) – Austrian oil company OMV posted better than expected fourth-quarter profits on Thursday, helped by a stronger refining and marketing business, and maintained its dividend at 1.25 euros a share, despite the sharp fall in crude prices.
The company also said it expects the North Sea Brent oil price to remain at $50-60 per barrel this year.
But OMV's underlying operating profit rose 23 percent to 545 million euros ($622 million) in the fourth quarter, beating analysts' forecasts which averaged 487 million, according to a Reuters poll.
Oleg Galbur, analyst at Raiffeisen Centrobank, noted that the lower oil price buoyed OMV's refining and marketing division, where underlying earnings before interest and tax (EBIT) more than doubled in the quarter to 187 million euros.
OMV reiterated its plans to distribute 30 percent of net profit in dividends, joining other energy companies, including BP and Total, which have also said they do not intend to cut their payout ratios.
Underlying net income at OMV, which has struggled to present a convincing strategy to investors amid a management shake-up , nearly doubled to 348 million euros. Analysts had on average forecast a result of 199 million euros.
OMV said it planned to finalise divestment options for its ailing gas business in the first half of 2015 and start restructuring its downstream business in the second half.
It expected total oil and gas production in 2015 to average around 300,000 barrels of oil equivalent per day (boe/d) excluding Libya and Yemen, where political turmoil has hit output since 2011. Uninterrupted full capacity from those countries could provide around 43,000 boe/d in 2015, it said.
Charges mainly relating to its Turkish unit Petrol Ofisi and the power business of Romanian arm Petrom pushed it to a quarterly net loss of 308 million.
OMV, as already announced, is slashing capital spending. In 2015 it plans to spend 2.5-2.8 billion euros, down from its previous annual investment budget of almost 4 billion euros.
Oil companies across the globe have announced capital spending cuts as well as asset sales worth billions of dollars as a result of weak crude prices. ($1 = 0.8761 euros)
(Additional reporting by Alexandra Schwarz-Goerlich, Editing by Michael Shields, Greg Mahlich)
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