Total's quarterly results drop 44%

The Board of Directors of Total (TOT), led by Chairman Thierry Desmarest, met on February 10, 2010 to review the Group’s fourth quarter 2009 accounts and to close the parent company and consolidated accounts for 2009. Adjusted net income was 7.8 billion euros, a 44% decrease compared to 2008. Expressed in dollars, adjusted net income was 10.9 billion dollars, a decrease of 47%. 

The Board of Directors decided to propose at its annual meeting on May 21, 2010, a dividend of 2.28 €/share, stable in euros compared to 2008 and, expressed in dollars4, an increase of 9%. 

Commenting on the results, CEO Christophe de Margerie said: “The 2009 oil and gas market environment was marked by a sharp decline in the demand for oil, natural gas and refined products. Crude oil prices, nonetheless, rebounded during the year to average 61.7 $/b thanks to the support from OPEC reductions and the anticipation by the market of an economic recovery. In contrast, natural gas spot prices remained depressed and refining margins fell to historically low levels, under pressure from significant overcapacity. In Chemicals, despite strong demand for polymers in China, the environment was hurt by low margins and a sharp drop in demand in OECD markets. 

In this context, Total’s 2009 adjusted net income was 10.9 B$, a decrease of 47% compared to 2008. The Group’s results for the year were among the most resilient of the major oils. In the fourth quarter, thanks to a 6% increase in Upstream production, higher oil prices and Downstream results that remained slightly positive despite very weak refining margins, adjusted net income rose to 3.1 B$, an increase of 15% compared to the third quarter. 

With its strong balance sheet and financial flexibility, Total has been able to continue its investment program and dividend policy in 2009, while keeping its net-debt-to-equity ratio, in line with its objectives, at 27% at the end of December 2009. 

In the Upstream, in 2009 five major projects started production in Nigeria, the Gulf of Mexico, Angola, Qatar and Yemen. The Group also approved the investment to launch the Surmont Phase II project in Canada, and, to further strengthen its portfolio, entered into a number of joint ventures, notably with Chesapeake and Cobalt in the United States, Novatek in Russia, and Sonatrach in Algeria. These additions were made within the framework of the company’s strict financial criteria. In addition, cost reduction plans launched in late 2008 led to an 8% reduction in operating costs and allowed the company to maintain its technical costs at 15.4 $/boe, the same level as in 2008. 

The Downstream and Chemicals segments continued to implement plans to adapt to the particularly difficult conditions they faced in 2009 that included reducing capacity to restore profitability to these activities in an environment undergoing profound transformation. The measures taken in the modernization of the refining and petrochemicals site at Normandy demonstrate the Group’s will to be socially responsible as it adapts its industrial operations to structural changes in the market. 

In addition, outlays for research and development rose to 650 million euros in 2009, an increase of 6% compared to 2008. In particular, this allowed the Group to start up this year the pilot project for CO2 capture and storage at Lacq, which illustrates its commitment to the fight against global climate change. 

In reaffirming the priority of safety and the environment and by building on its investment discipline, its high-quality portfolio and its recognized expertise, Total is confident in its ability to pursue its strategy of profitable and responsible growth to create value for all of its stakeholders.”

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