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Repsol H1 adjusted net income 917 million euros

Staff Writer | July 28, 2016
Repsol posted an adjusted net income of 917 million euros in the first half of 2016, compared with 1.24 billion in the same period of the previous year.
Repsol   Savings are expected to be at least 1.2 million euros
The first half of 2015 included exceptional financial results of more than 500 million euros, essentially due to the position in dollars that Repsol held after receiving payment for the expropriation of YPF, which subsequently went toward the acquisition of Talisman.

Net income was 639 million euros compared with 1.053 billion euros during the same period of the previous year. Included in this result was the total extraordinary expense of 346 million euros to cover the restructuring of the workforce approved by the company for 2016, 2017 and 2018.

In an environment of depressed crude oil and gas prices, the efficiency and savings measures implemented by Repsol have led to positive results for all business units. Particularly outstanding was the improvement in the net adjusted income of the Upstream area, which increased by 301 million euros compared with the same period of 2015.

During the period, international benchmarks suffered a notable decline in comparison with the first six months of 2015. The average Brent price dropped 31%, the WTI dropped 25% and Henry Hub declined 28%.

Average hydrocarbon production increased to 705,500 barrels of oil equivalent per day, 60% more than that produced during the same period in 2015, principally because of the incorporation of Talisman assets and the increases in production from Bolivia, Venezuela, Norway, Brazil and Peru.

The Downstream unit’s results were in line with those obtained between January and June of the previous year with an especially strong performance from the Chemicals business, which improved its sales and margins.

Net debt decreased since the end of 2015, and stood at 11.709 billion euros at the end of the first half, while the company’s liquidity covered nearly twice the amount of its gross short-term debt maturities. In recent months the company has taken advantage of market conditions to reduce the financial cost of its debt.

By the end of the first half the company had already implemented projects that ensure the achievement of approximately 70 percent of its objectives for synergies and efficiencies for 2016. Those savings are expected to be at least 1.2 million euros for the entire year.