Paris, France | – French multinational oil giant Total announced a 20% fall in first quarter profits on Tuesday due to slumping oil prices and disruption of its activities because of violence in Yemen and Libya.
Total said in a statement that profits for the first three months of the year dropped to $2.6 billion from $3.3 billion during the same period last year, on 30% lower sales of $42.3 billion.
The company said the profit slide amounted to 22% in adjusted terms compared to the first quarter of 2014. But it said that erosion was partially offset by a 10 percent hike in production to 2.4 million barrels per day, and capital gains realised on asset sales.
Total chairman Patrick Pouyanne said that the slackening profit was relatively moderate in a market where “the Brent price decreased by 50% compared to last year.”
The adjusted net result also beat analysts’ forecasts of $2.1bn in profits.
The numbers also were largely in synch with first quarter figures revealed by British rival BP Tuesday, which said its profits had dipped 26% to $2.6bn.
Pouyanne also cited the positive impact of Total’s push to cut $1.2bn in operating costs, and profits made on $5bn in assets Total has already sold out of a total of $10bn it has decided to shed.
“Against a backdrop of lower prices, Total’s first quarter results include a number of significant accomplishments in all segments,” Pouyanne said. “Total is thus demonstrating its resilience and profiting from its integrated model.”
In addition to depressed global oil prices, Total said income was undermined by the closure of the LNG gas terminal in Yemen since April, due to continuing violence there.
Total owns 40% of the installation.
The French major also said violence in Libya had forced the group to cease all onshore activity in the country.
To offset that, Total said it had upped production in operations in Angola and Norway, and from its new activities in the Abu Dhabi’s onshore oil fields.
Pouyanne said Total seeks to boost production for 2015 by around 8%, while continuing to decrease its refining and chemical capacities by 20% by 2017.
Investors on the Paris Bourse responded to those results by sending Total’s share price rising 1.64% in early trades.