Home » FINANCING » Eni Reports $838 Million Loss in Q2, Blames Covid-19

Eni Reports $838 Million Loss in Q2, Blames Covid-19

by James Ikenna…………

Eni, the Italian giant, one of several European energy major has reported an adjusted net loss of 714 million euros ($839 million) in this quarter, compared with a profit a year earlier, the Rome-based oil company said in a statement.
Analysts had estimated a 1.11 billion-euro loss. Eni’s second-quarter loss has led to a reducction of its dividend as the coronavirus crisis sent oil prices plunging.
Eni now sees its full-year dividend at 55 euro cents a share, compared with an expectation of 89 euro cents back in February. The decision to cut follows similar moves at Royal Dutch Shell Plc and Equinor ASA.

These poor financial outings by the oil majors has been blamed by the slump in demand for crude and fuels as various governments the worldover imposed lockdowns to contain the virus. Consumption fell particularly sharply in its home market the first European economy crippled by the pandemic.

“We have gone through what is likely to be one of the most challenging quarters the oil and gas industry has faced in its history,” Chief Executive Officer Claudio Descalzi said in the statement. “Emerging from the pandemic will be difficult, with signs of great uncertainty still to come.”

Eni shares fell 3.8% in Milan to trade at 8.09 euros as of 9:25 a.m. local time. The stock has slumped 42% this year.

The company’s quarterly production slid to 1.71 million barrels of oil equivalent a day from 1.83 million a day a year earlier, according to the statement. Eni cut its forecast for the year to 1.71 million to 1.76 million barrels a day from a previous projection of as much as 1.8 million.

The revision is also attributed to a 2.6 billion-euro reduction in 2020 capital spending, lower global gas demand and persistent operational problems in Libya.

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