Statoil net income drops
Statoil posted a third quarter 2014 net operating income of NOK 17.0 billion, a decrease from NOK 39.3 billion in the third quarter of 2013.
Net income was negative NOK 4.8 billion mainly due to impairments. Adjusted earnings were NOK 30.9 billion, a decrease from NOK 40.4 billion in the third quarter of 2013.
“Statoil’s quarterly earnings were negatively impacted by lower oil and gas prices and our decision to defer gas sales to enhance value. Our negative net income in accordance with IFRS relates to quarter-specific items. We delivered strong operational performance and cash generation in the quarter,” said Eldar Sætre, Statoil’s acting president and CEO.
Sætre added that the company is progressing well on the efficiency improvement program. It continued to produce with high regularity on the Norwegian continental shelf and execute the projects as planned, remaining on track for 2014 production guiding.
Statoil’s adjusted earnings were NOK 30.9 billion in the third quarter. The decrease from the third quarter of 2013 was mainly a result of lower oil and gas prices, reduced ownership share from divestments, higher depreciation due to investments in producing assets, new fields coming on stream and a larger share of oil in the production mix.
Statoil’s reported net income for the third quarter in accordance with IFRS was negative NOK 4.8 billion due to quarter specific accounting charges of NOK 13.5 billion. These charges were mainly related to an impairment of the Kai Kos Dehseh asset in Canada, triggered by the postponement of the Corner field development, as well as impairments of exploration assets in the Gulf of Mexico and Angola.
“Our cash flow from operations so far this year is NOK 168 billion before tax. We have a strong balance sheet, and will pay a dividend of NOK 1.80 per share for the quarter,” says Sætre.
1 NOK = 0.15125 USD
Press Release; Image: Statoil