As expected, the fall in international energy prices has fully hit Repsol’s profits, which closed the first half of 2023 with a 44% drop in profits, to 1,420 million euros, according to information deposited this Thursday by the company at the National Securities Market Commission (CNMV).
One year after the outbreak of the war in Ukraine, the company has operated in a scenario that it describes as one of “uncertainty, global inflation and slow recovery of the Chinese economy,” and with “a collapse in the prices of energy products compared to to 2022, when there was an abnormal rise in the prices of raw materials”. Its refining margins fell 29%, Brent crude prices fell 26% and the US gas benchmark, the Henry Hub, fell 54%.
The gross operating result (Ebitda) closed the period at 4,303 million euros, 46.3% below that obtained in the same period of the previous year. While the adjusted result, which specifically measures the operation of the businesses, stood at 2,718 million euros between January and June, 15.7% lower due to “the increase in production, the integrated management of the refining system in Spain and the advances in attracting and retaining customers, especially through the Waylet app,” he explained in the statement.
The group invested 3,047 million euros in the period, mainly in low-carbon projects. In line with its Strategic Plan, Repsol foresees that 35% of the investments in 2023 will be dedicated to low-carbon projects, to advance the transformation from an oil company to a multi-energy company. During the first half of the year, 43% of the total investment went to Spain and 39% to the United States.
Repsol will update its Strategic Plan during the first quarter of 2024, a decision that it takes “after achieving all the main objectives set out in the plan two years ahead of schedule,” he says. The new plan “will focus on a strategy that allows reaching zero net emissions in 2050, while improving the value position of the company.”
The financial magnitudes of the company in the period show an increase in liquidity to 11,441 million euros, which makes it possible to cover 6 times the short-term gross debt maturities. To this is added a powerful reduction in debt to 797 million, 65% below the closing date of December 31, 2022.
On the other hand, the company has also reported this morning a new capital reduction of 60 million own shares before the end of 2023, in addition to the 50 million shares already approved by the general meeting of shareholders.
The combination of dividends and capital reductions that the company is carrying out will mean the distribution in 2023 of close to 2,400 million euros to its more than 520,000 shareholders, who are mostly minority and located in Spain. The capital reductions during 2023, added to the 200 million shares redeemed in 2022, represent a total of 310 million shares, equivalent to 20% of the existing share capital as of December 2021 and well above the target established by the Strategic Plan 2021-2025.
Repsol maintains an 11% increase in the cash dividend compared to the previous year, up to 0.70 euros gross per share. The shareholders also agreed to distribute another 0.375 euros gross per share charged to free reserves, the distribution of which is scheduled for the month of January 2024, on the date specified by the Board of Directors.
As regards the tax contribution, in the first half of 2023, Repsol maintained its high level of contribution with 7,343 million euros, of which 67% (4,960 million euros) correspond to Spain.
Own taxes accrued amounted to 2,186 million euros and represented 59% of profits. Repsol contributed during the period with a Corporate Tax rate of 31%.
