TotalEnergies Keeps Investor Payouts Despite Weak Outlook

The TotalEnergies headquarters in Paris. Photographer: Benjamin Girette/Bloomberg Photo by Benjamin Girette /Bloomberg

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(Bloomberg) — TotalEnergies SE drew a contrast with its industry peers, sticking to plans for both investor payouts and project investment despite a profit miss and a weak outlook for oil markets.

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Citing its low levels of debt and the strength of its balance sheet, the French energy giant said it would repurchase another $2 billion of shares in the second quarter and stuck to its plan for a 7.6% dividend increase this year. It also maintained its target for capital expenditure. 

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Despite weaker oil markets, Chief Executive Officer Patrick Pouyanne said in a statement that he was “confident in the company’s ability to reach its 2025 underlying growth objective, taking into account the strength of its balance sheet.”

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TotalEnergies shares fell 2.7% to €50.93 as of 9 a.m. in Paris. 

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Many oil companies are curbing spending as they brace for lower earnings amid President Donald Trump’s disruption of the global economy. BP Plc and Eni SpA both trimmed their capital expenditure and warned of the possibility for a further slowdown in industry activity. 

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TotalEnergies’ adjusted net income was $4.19 billion in the first quarter, down from $5.11 billion a year earlier, the company said on Wednesday. Analysts had expected $4.38 billion.

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Oil prices should remain volatile between $60 and $70 a barrel in coming months because of sluggish economic growth, trade disruptions and higher crude output by the Organization of the Petroleum Exporting Countries and its allies, the company said. Refining and petrochemical margins are expected to remain weak.  

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The group’s net debt rose to $20.1 billion at the end of the first quarter, up $5.9 billion from a year earlier, due in part to seasonal variation in working capital. Still, Total reiterated its net investments guidance of $17 billion to $17.5 billion for 2025 — of which $4.5 billion will be dedicated to low carbon energies — and said it’s on track to boost hydrocarbon output by more than 3% this year.

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(Updates with details on oil prices, margins and debt from the first paragraph.)

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