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Total’s 2Q16 Earnings Surpass Estimates: How Do They Compare?

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Aug. 1 2016, Published 9:31 a.m. ET

Total’s 2Q16 performance

Total SA (TOT) posted its 2Q16 results on July 28, 2016. In this series, we’ll compare Total’s 2Q16 numbers with its estimates and evaluate its 2Q16 segmental performance. We’ll also look at the company’s stock performance, implied volatility, and analyst recommendations after the 2Q16 results.

In 2Q16, TOT’s revenues of $37.2 billion surpassed Wall Street estimates. Its 2Q16 adjusted EPS (earnings per share) stood at $0.90, about 10% higher than the estimated EPS of $0.82. However, it was 33% lower than 2Q15 adjusted EPS.

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Total’s 2Q16 earnings

Total (TOT) saw a fall of 30% in its net adjusted earnings from 2Q15 to $2.2 billion in 2Q16. This was due to lower earnings across its business segments.

Net adjusted operating earnings from its upstream segment fell from $1.6 billion in 2Q15 to $1.1 billion in 2Q16 due to a steep fall in oil prices. TOT’s downstream segment’s adjusted net operating income fell from $1.3 billion in 2Q15 to $1.0 billion in 2Q16. We’ll take a look at the segment-wise performance in the next part.

TOT’s peer Royal Dutch Shell (RDS.A) has posted a 71% year-over-year decline in earnings in 2Q16. ExxonMobil (XOM) and Chevron (CVX) are expected to post 21% and 24% lower adjusted EPS in 2Q16 compared to 2Q15, respectively. The iShares Russell 1000 Value ETF (IWD) has a ~13% exposure to energy sector stocks.

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