TotalEnergies SE: First Quarter 2024: Main Indicators

Rhea-AI Summary

TotalEnergies SE (TTE) reports main indicators and estimated financial information for the first quarter of 2024, showing stable hydrocarbon production, growth in LNG production, and positive results in Integrated Power. Downstream results are expected to reflect increased refining margins, with oil and LNG trading results in line with historical averages. Sensitivities for 2024 include impacts on adjusted net operating income and cash flow from operations based on changes in dollar value, average liquids price, European gas price, and European Refining Margin Marker.

Insights

Energy Market Analyst

In examining TotalEnergies SE's reported indicators for the first quarter of 2024, it's clear that developments in the energy market are playing a pivotal role. Notably, the Brent crude benchmarks—a proxy for international oil prices—have shown a slight decrease compared to previous quarters. This trend can often signal shifts in global supply-demand dynamics, potentially impacting energy companies. The reported stability in hydrocarbon production despite asset disposals indicates operational efficiency and strategic asset management. The growth in integrated power and LNG production could suggest a diversification strategy that is increasingly important as the energy transition accelerates.

Financial Analyst

The financial implications of TotalEnergies' performance are multifaceted. The reported quarter-on-quarter stability in hydrocarbon production above 2.45 Mboe/d, combined with the increase in refining margins, suggests a potential strengthening in downstream profitability. This could lead to favorable outcomes for adjusted net operating income, which is pivotal for investors' confidence. Moreover, the estimated sensitivities to fluctuations in the dollar exchange rate, average liquids price and European gas price highlight the company's exposure to market volatility. Investors should be mindful of the risk management strategies employed by TotalEnergies to mitigate such volatility.

Commodity Trading Analyst

TotalEnergies’ anticipated trading results, in line with historical averages due to low volatility, may not excite traders looking for large swings to capitalize on. However, the stability can be appreciated by investors seeking consistent performance. It’s also important to note the influence of the European Refining Margin Marker, as it reflects the profitability of European refining operations. The substantial increase in this metric indicates a beneficial environment for TotalEnergies' refining segment, which is significant given the capital-intensive nature of refining and its impact on cash flow.

PARIS--(BUSINESS WIRE)-- Regulatory News:

TotalEnergies SE (Paris:TTE) (LSE:TTE) (NYSE:TTE):

The main indicators, estimated financial information and key elements impacting TotalEnergies’ first quarter 2024 aggregates are shown below:

Main indicators
		1Q24	4Q23	3Q23	2Q23	1Q23
€/$		1.09	1.08	1.09	1.09	1.07
Brent	($/b)	83.2	84.3	86.7	78.1	81.2
Average liquids price * (1)	($/b)	78.9	80.2	78.9	72.0	73.4
Average gas price * (1)	($/Mbtu)	5.11	6.17	5.47	5.98	8.89
Average LNG price ** (1)	($/Mbtu)	9.58	10.28	9.56	9.84	13.27
European Refining Margin Marker (ERM) ***	($/t)	71.7	52.6	100.6	40.1	90.7

* Sales in $ / Sales in volume for consolidated affiliates.

** Sales in $ / Sales in volume for consolidated and equity affiliates.

*** This market indicator for European refining, calculated based on public market prices ($/t), uses a basket of crudes, petroleum product yields and variable costs representative of the European refining system of TotalEnergies.

⁽¹⁾ Does not include oil, gas and LNG trading activities, respectively.

Main elements impacting the quarter aggregates

• Hydrocarbon production is expected to be stable quarter-on-quarter, above 2.45 Mboe/d, despite the Canadian oil sands assets disposals effective during the fourth quarter 2023, thanks to the growth in LNG production and the startups of Mero 2 in Brazil and Akpo West in Nigeria.
• Integrated Power results are expected to be up quarter-on-quarter, thanks to growth in the business.
• Downstream results will reflect the increase in refining margins, as the utilization rate of refineries during the first quarter 2024 was relatively stable compared to the fourth quarter 2023.
• Due to the low volatility during the first quarter 2024, oil and LNG trading results are expected to be in line with their historical averages.

2024 Sensitivities*
	Change	Estimated impact on adjusted net operating income		Estimated impact on cash flow from operations
Dollar	+/- 0.1 $ per €	-/+ 0.1 B$		~0 B$
Average liquids price **	+/- 10 $/b	+/- 2.3 B$		+/- 2.8 B$
European gas price – NBP / TTF	+/- 2 $/Mbtu	+/- 0.4 B$		+/- 0.4 B$
European Refining Margin Marker (ERM)	+/- 10 $/t	+/- 0.4 B$		+/- 0.5 B$

* Sensitivities are revised once per year upon publication of the previous year’s fourth quarter results. Sensitivities are estimates based on assumptions about TotalEnergies’ portfolio in 2024. Actual results could vary significantly from estimates based on the application of these sensitivities. The impact of the $-€ sensitivity on adjusted net operating income is essentially attributable to Refining & Chemicals.

** In a 80 $/b Brent environment.

Disclaimer

Unless otherwise stated, the terms “TotalEnergies”, “TotalEnergies company” and “Company” in this document are used to designate TotalEnergies SE and the consolidated entities directly or indirectly controlled by TotalEnergies SE. Likewise, the words “we”, “us” and “our” may also be used to refer to these entities or their employees. The entities in which TotalEnergies SE directly or indirectly owns a shareholding are separate and independent legal entities.

The data presented in this document is based on TotalEnergies’ internal preliminary reporting and is not audited. This data is not intended to be a comprehensive summary of all items that will affect TotalEnergies SE’s results or to provide an estimate of the first quarter 2024 results. Actual results may vary. To the extent permitted by law, TotalEnergies SE disclaims all liability from the use of this data.

This document may contain forward-looking statements (including forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995), notably with respect to the financial condition, results of operations, business activities and strategy of TotalEnergies. This document may also contain statements regarding the perspectives, objectives, areas of improvement and goals of TotalEnergies, including with respect to climate change and carbon neutrality (net zero emissions). An ambition expresses an outcome desired by TotalEnergies, it being specified that the means to be deployed do not depend solely on TotalEnergies. These forward-looking statements may generally be identified by the use of the future or conditional tense or forward-looking words such as “will”, “should”, “could”, “would”, “may”, “likely”, “might”, “envisions”, “intends”, “anticipates”, “believes”, “considers”, “plans”, “expects”, “thinks”, “targets”, “aims” or similar terminology. Such forward-looking statements included in this document are based on economic data, estimates and assumptions prepared in a given economic, competitive and regulatory environment and considered to be reasonable by TotalEnergies as of the date of this document.

These forward-looking statements are not historical data and should not be interpreted as assurances that the perspectives, objectives or goals announced will be achieved. They may prove to be inaccurate in the future, and may evolve or be modified with a significant difference between the actual results and those initially estimated, due to the uncertainties notably related to the economic, financial, competitive and regulatory environment, or due to the occurrence of risk factors, such as, notably, the price fluctuations in crude oil and natural gas, the evolution of the demand and price of petroleum products, the changes in production results and reserves estimates, the ability to achieve cost reductions and operating efficiencies without unduly disrupting business operations, changes in laws and regulations including those related to the environment and climate, currency fluctuations, technological innovations, meteorological conditions and events, as well as socio-demographic, economic and political developments, changes in market conditions, loss of market share and changes in consumer preferences, or pandemics such as the COVID-19 pandemic. Additionally, certain financial information is based on estimates particularly in the assessment of the recoverable value of assets and potential impairments of assets relating thereto.

Readers are cautioned not to consider forward-looking statements as accurate, but as an expression of the Company’s views only as of the date this document is published. TotalEnergies SE and its subsidiaries have no obligation, make no commitment and expressly disclaim any responsibility to investors or any stakeholder to update or revise, particularly as a result of new information or future events, any forward-looking information or statement, objectives or trends contained in this document. In addition, the Company has not verified, and is under no obligation to verify any third-party data contained in this document or used in the estimates and assumptions or, more generally, forward-looking statements published in this document.

The information on risk factors that could have a significant adverse effect on TotalEnergies’ business, financial condition, including its operating income and cash flow, reputation, outlook or the value of financial instruments issued by TotalEnergies is provided in the most recent version of the Universal Registration Document which is filed by TotalEnergies SE with the French Autorité des Marchés Financiers and the annual report on Form 20-F filed with the United States Securities and Exchange Commission (“SEC”).

Additionally, the developments of environmental and climate change-related issues in this document are based on various frameworks and the interests of various stakeholders which are subject to evolve independently of our will. Moreover, our disclosures on such issues, including climate-related disclosures, may include information that is not necessarily "material" under US securities laws for SEC reporting purposes or under applicable securities law.

Financial information by business segment is reported in accordance with the internal reporting system and shows internal segment information that is used to manage and measure the performance of TotalEnergies. In addition to IFRS measures, certain alternative performance indicators are presented, such as performance indicators excluding certain adjustment items described below (adjusted operating income, adjusted net operating income, adjusted net income), return on equity (ROE), return on average capital employed (ROACE), gearing ratio, operating cash flow before working capital changes, the shareholder rate of return. These indicators are meant to facilitate the analysis of the financial performance of TotalEnergies and the comparison of income between periods. They allow investors to track the measures used internally to manage and measure the performance of TotalEnergies. The adjusted results (adjusted operating income, adjusted net operating income, adjusted net income) are defined as replacement cost results, adjusted for special items, excluding the effect of changes in fair value. For further details on the adjustment items, please refer to the last published earnings statement and notes to the consolidated financial statements.

Euro amounts presented for the fully adjusted-diluted earnings per share represent dollar amounts converted at the average euro-dollar (€-$) exchange rate for the applicable period and are not the result of financial statements prepared in euros.

Cautionary Note to US Investors – The SEC permits oil and gas companies, in their filings with the SEC, to separately disclose proved, probable and possible reserves that a company has determined in accordance with SEC rules. We may use certain terms in this document, such as “potential reserves” or “resources”, that the SEC’s guidelines strictly prohibit us from including in filings with the SEC. US investors are urged to consider closely the disclosure in the Form 20-F of TotalEnergies SE, File N° 1-10888, available from us at 2, place Jean Millier – Arche Nord Coupole/Regnault – 92078 Paris-La Défense Cedex, France, or at the Company website totalenergies.com. You can also obtain this form from the SEC by calling 1-800-SEC-0330 or on the SEC’s website sec.gov.

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TotalEnergies SE

Source: TOTALENERGIES SE

FAQ

What are the main indicators reported by TotalEnergies SE for the first quarter of 2024?

TotalEnergies SE reports main indicators such as Brent price, average liquids price, average gas price, average LNG price, and European Refining Margin Marker for the first quarter of 2024.

How is hydrocarbon production expected to perform in the first quarter of 2024?

Hydrocarbon production is expected to be stable quarter-on-quarter, above 2.45 Mboe/d, despite the Canadian oil sands assets disposals effective during the fourth quarter 2023, thanks to the growth in LNG production and the startups of Mero 2 in Brazil and Akpo West in Nigeria.

What is the expected performance of Integrated Power results in the first quarter of 2024?

Integrated Power results are expected to be up quarter-on-quarter in the first quarter of 2024, thanks to growth in the business.

How will downstream results be impacted in the first quarter of 2024?

Downstream results will reflect the increase in refining margins, as the utilization rate of refineries during the first quarter 2024 was relatively stable compared to the fourth quarter 2023.

What are the sensitivities for 2024 provided by TotalEnergies SE?

Sensitivities for 2024 include changes in dollar value, average liquids price, European gas price, and European Refining Margin Marker, with estimated impacts on adjusted net operating income and cash flow from operations.