(Bloomberg) -- TotalEnergies SE raised its dividend and maintained the pace of share buybacks, shrugging off a drop in fourth-quarter earnings caused by weaker oil prices and shrinking refining margins.
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The French energy giant’s results are line with other major oil and gas producers, with rivals Shell Plc and Chevron Corp. also prioritizing cash returns to investors even as they posted declining end-of-year profits. Lower earnings could put pressure on the industry’s ability to fund hefty share buybacks in the longer term, but for now it is coping with sluggish economic growth in Europe and mounting trade tensions provoked by the policies of US President Donald Trump.
Earnings fell “in a softer environment, mainly affected by a sharp decline in refining margins, after two exceptional years,” TotalEnergies’ Chief Executive Officer Patrick Pouyanne said in a statement on Wednesday.
Adjusted net income fell 16% in the fourth-quarter from a year earlier to $4.41 billion, according to the statement, beating the average analyst estimate of $4.26 billion.
The company plans to buy back $2 billion of its shares per quarter this year assuming “reasonable market conditions,” matching the pace in 2024, according to the statement. The company assumes an oil price of $70 a barrel this year, Pouyanne told reporters in Paris. The quarterly dividend increased to €0.85 a share, from €0.79 previously.
TotalEnergies’ shares rose 1.0% to €57.59 as of 9:03 a.m. in Paris trading.
As other majors that previously embraced the transition to clean energy have pivoted back toward oil and gas, TotalEnergies continued to tout the growth of its power business. The company’s net electricity production rose 23% to 41 terawatt-hours in 2024, compared with a year earlier. That figure should rise to 50 terawatt-hours this year, equivalent to 10% of its hydrocarbon production.
Pouyanne attributed the resilience in the company’s fourth-quarter earnings to a strong performance in TotalEnergies’ liquefied natural gas and integrated power businesses. “The company achieved nearly a 15% return on average capital employed in 2024, the best among the majors for the third consecutive year,” he said in the statement.
The French oil major foresees net investment in the range of $17 billion to $17.5 billion in 2025, in line with 2024. Of that, $4.5 billion will be spent on low-carbon energy, mostly power. It expects hydrocarbon production to grow by more than 3% this year as new projects ramp up in the Gulf of Mexico and Brazil, with output of about 2.5 million barrels of oil equivalent a day in the first quarter.