Equinor to Report Second Quarter Results
Equinor, the Norwegian energy major, is set to announce its second quarter results on Wednesday. Let's take a look at the key details:
Net Income Forecast:
According to a company-compiled consensus, adjusted earnings are expected to decline to $7.64 billion in the second quarter, compared to $17.59 billion in the same quarter last year. Analysts polled by FactSet also predict a decrease in net profit to $2.21 billion from $5.0 billion.
Revenue Forecast:
Revenue is anticipated to drop by 31% to $25.0 billion from $36.32 billion in the previous year, based on a FactSet average.
What to Watch:
Oil and Gas:
RBC Capital Markets analyst Biraj Borkhataria has noted that Equinor's update earlier in July highlighted weaker prices for liquids and gas compared to his own estimates. Particularly, European gas realizations were much lower than expected. Additionally, Norwegian exports in the second quarter have been disappointing due to unplanned outages, potentially caused by companies prioritizing high production volumes and deferring maintenance after the surge in gas prices in 2022. The commentary on this matter will be significant for Equinor's future investment prospects.
Guidance:
Equinor has provided guidance for organic capital expenditure, stating an average of $10 billion-$11 billion per year in 2023 and approximately $13 billion per year for 2024-26. In 2023, the company expects a production growth of approximately 3% above the level achieved in 2022.
Shareholder Returns:
During its capital markets day in February, Equinor mentioned that extraordinary dividends would be determined quarterly. After announcing a special dividend of $0.60 per share alongside the fourth quarter 2022 earnings, the company followed up with another $0.60 special dividend accompanying the first quarter 2023 results. RBC analysts believe that the dividend will remain at this level for two more quarters, before decreasing to $0.25 per share in the fourth quarter as 2024 approaches. They also expect no changes in the annual buyback guidance.
For more information about Equinor's second quarter results, stay tuned for the official announcement on Wednesday.
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