Repsol announces dividends to shareholders after the first quarter exceeded expectations

After reporting first-quarter results that were better than expected, Repsol, a Spanish energy company, pledged to maintain its dividend policy even if the market conditions worsen in future quarters.

The adjusted net profit for the quarter fell by 48% compared to a year ago, reaching 651 million euro ($741 millions), exceeding the average estimate of the company at 642 million euro.

It said that the above-mentioned forecasts were achieved despite the fact that oil refining profits had more than halved from a year ago, despite lower oil prices and a decline in margins for its chemical business, as well as market volatility.

In a press release, Chief Executive Josu Imaz stated that "we have laid the foundations to achieve our goals for 2025. We have ensured our commitment to shareholders remuneration and optimised investments, while improving our portfolio by divestments which will represent an inflow of cash of approximately 700 million euros."

The company has confirmed that it will pay out between 30 and 35 percent of its cash flow generated from operations to shareholders.

Even if the market conditions worsened, with oil refinery margins dropping to $4 per barrel or Brent crude oil prices falling to $65 per barrel, the target would still stand.

Brent crude was priced at $76 per barrel on average in the first three months of this year. Refining margins were $5.3 per barrel.

If this scenario occurs, the company will forecast lower cash flows from operations and reduce investments.

The net profit of the company, which includes items related to divestments, inventory and provisions, dropped to 366 millions euros from 969million euros during the same period in last year.

(source: Reuters)