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Total Q4 Profit Rises On Higher Price, Hikes Dividend

French oil giant Total SA (TOT: Quote, TTFNF.PK, TTA.L) reported Wednesday a higher profit for its fourth quarter, supported by sales growth and price strength, despite lower production. The upstream segment performed badly with a decrease in production and higher exploration expenses. The company also announced a higher dividend for the year.

In its recently concluded fourth quarter, group share net income was 2.38 billion euros, 4 percent higher than last year. Adjusted net income, which excluded 312 million euros of negative inventory effect, negative special items of 398 million euros and positive 10 million euros of changes in fair value, grew 13 percent to 3.08 billion euros or 1.36 euros per share.

In US dollar terms, group share net income remained flat with last year's $3.09 billion, while adjusted profit increased 9 percent to $4 billion or $1.76 per share. On average, five analysts polled by Thomson Reuters expected earnings of $1.68 per share for the quarter. Such estimates typically exclude special items.

Sales increased 5 percent to 49.87 billion euros from 47.49 billion euros last year. In dollar terms, sales edged up 1 percent to $64.66 billion.

Combined production totaled 2.29 million barrels of oil equivalent per day, a decline of 4 percent from last year, reflecting a 3 percent drop in liquids production and a 5 percent decline in gas production.

Brent price increased 1 percent, average liquids price rose 2 percent, and average gas price grew 2 percent. The European refining margin indicator more than doubled.

Adjusted operating income from business segments dropped 6 percent, while adjusted net operating income from segments grew 10 percent as strong growth in refining and chemicals as well as marketing and services helped offset a 6 percent drop in upstream segment.

In the refining and chemicals segment, refinery throughput fell 2 percent essentially due to the temporary shut-down of Normandy refinery in connection with the upgrading project, as well as the closure of the Rome refinery. Sales of marketing and services dropped 6 percent mainly due to the sale of marketing activities in the UK.

In the year 2012, net income group share dropped 13 percent to 10.69 billion euros. Adjusted net income in dollar terms dropped 1 percent to $7.01 per share. Sales grew 8 percent to 200.06 billion euros, while production dropped 2 percent.

Total said its Board has decided to propose to AGM a fourth-quarter dividend of 0.59 euros per share, resulting in full-year dividend of 2.34 euros per share, about 3 percent higher than last year.

Looking ahead, Total confirmed its production growth targets in the upstream business for 2015 of 3 percent per year on average, and for 2017, a potential of 3 million boe/d.

In 2013, the company expects that production growth to be fueled by 2012 start-ups as well as anticipated 2013 start-ups.

In Paris, Total shares are currently trading at 38.24 euros, down 0.12 euros or 0.33 percent.

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by RTT Staff Writer

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