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Eni's (E) Q4 Earnings Beat Estimates, Revenues Fall Y/Y

Zacks Equity Research

Eni S.p.A. E delivered fourth-quarter 2018 adjusted earnings from continuing operations of 94 cents per American Depository Receipt/ADR, which beat the Zacks Consensus Estimate of 73 cents. The company generated earnings of 64 cents in the year-earlier quarter. The improvement can be attributed to higher liquids production and realized prices.

Eni SpA Price, Consensus and EPS Surprise


Eni SpA Price, Consensus and EPS Surprise | Eni SpA Quote


Total revenues in the quarter were $22,885 million, down from $24,592 million in the year-ago quarter and $23,144 million in third-quarter 2018. The downside was caused by lower gas production.

Operational Performance

Total liquids and gas production in the fourth quarter was 1,872 thousand barrels of oil equivalent per day (MBoe/d), down 1.1% year over year. The downtick stemmed from decline in gas demand. This was offset by increase in production, which can be attributed to project start-ups in Angola, Ghana, Egypt and Kazakhstan.

Liquids production was 897 thousand barrels per day (MBbl/d), up 4.2% from the year-ago quarter’s level of 861MBbl/d. Natural gas production fell 5.4% year over year to 5,321 million cubic feet per day (MMcf/d).  

Realized price of oil was $61.22 per barrel, up 6.2% from the year-ago quarter’s figure of $57.64 per barrel. Realized natural gas price was $6.11 per thousand cubic feet (Mcf), up 57.5% from $3.88 in the year-ago quarter.

Gas sales were 18.72 billion cubic meters (Bcm), down 12.8% from the year-ago quarter’s tally. The decline was caused by lower sales in Italy, Germany, Austria, Turkey and France.  


As of Dec 31, 2018, the company had long-term debt (including current portions) of €20.1 billion. The debt-to-capitalization ratio was 28.2%.   

In the reported quarter, net cash generated by operating activities amounted to €4.3 billion. Capital expenditure totaled €2.9 billion.

Proved Reserves

Adjusted net proved reserves till 2018 was 7,153 million barrels of oil equivalent, which reflects reserves replacement ratio of 124%.

Zacks Rank & Key Picks

Eni carries a Zacks Rank #4 (Sell). Investors interested in the energy sector can opt for some better-ranked stocks as given below:

CrossAmerica Partners L.P. CAPL is involved in the wholesale distribution of motor fuels, consisting of gasoline and diesel fuel. The company delivered average positive earnings surprise of 436.7% in the last four quarters. The company currently holds a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

San Antonio, TX-based NuStar Energy L.P. NS is a midstream energy company. For 2019, its bottom line, which has witnessed three upside revisions over the past 30 days, is expected to grow 64.2% year over year. The company currently holds a Zacks Rank #2.

Madrid, Spain-based Repsol, S.A. REPYY is an integrated energy company. Its bottom line for 2019 is expected to increase 13.7% year over year. The company delivered average positive earnings surprise of 9% in the trailing four quarters. The stock currently has a Zacks Rank #2 (Buy).

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