Total’s Board of Directors met on February 5, 2020, to approve the Group’s 2019 financial statements. Commenting on the results, Chairman and CEO Patrick Pouyanné said:

“The Group reported solid fourth quarter 2019 results with cash flow (DACF) of 7.4 B$, an increase of more than 20% compared to the fourth quarter 2018, and adjusted net income stable at 3.2 B$, despite a lower price environment.

In 2019, the Group generated cash flow of 28.5 B$, strong growth of 2.4 B$ compared to 2018, thanks to a positive contribution from all segments. This performance was achieved despite the drop in oil prices of 10% and European gas prices of 38%, or a price environment down on average by about 20%. The Group reported solid adjusted net operating income for the year of 11.8 B$, a decrease of 13%, and a return on equity above 10%. The Group reduced its organic pre-dividend breakeven to less than 25 $/b.

In the Upstream, start-ups and ramp-ups including Yamal LNG in Russia and Ichthys in Australia, Egina in Nigeria and Kaombo in Angola, generated strong cash flow and fueled production growth of 9% for the year, with LNG growth of nearly 50%.

The Exploration & Production segment increased cash flow to 18 B$, despite the deterioration of the environment, and the iGRP segment, with an increase in LNG sales of nearly 60%, generated cash flow of 3.7 B$, an increase of 80%.

The Downstream contributed stable cash flow of 6.6 B$, notably thanks to its non-cyclical activities and despite a decrease in refining and petrochemical margins on the order of 10%.

Net investments rose to 17.4 B$ and reflect in particular the strategy to strengthen LNG and deep offshore, as shown by the acquisition of Mozambique LNG and the launching of Arctic LNG 2 in Russia and Mero 2 in Brazil. More than one-third of the net investments were made in the iGRP segment, which leads the Group’s lowcarbon ambition. Total enters the gas and renewables market in India in partnership with Adani and will build a giant 800 MW solar power plant in Qatar.

Total maintains a solid financial position with gearing of 16.7% excluding capitalized leases (20.7% including). In accordance with the decision of the Board of Directors announced on September 24, the Group increased the 2019 final dividend by 6% to €0.68 per share. Including the interim dividends, the full-year 2019 dividend increased by 5% to €2.68 per share. Finally, the Group bought back $1.75 billion of its shares in 2019 and projects 2 B$ of share buybacks in 2020 in a 60 $/b environment.”

Highlights since the beginning of the fourth quarter 201910

• Started production at giant Johan Sverdrup field in the North Sea and Iara in Brazil
• Launched Anchor projects and engineering studies for North Platte in Gulf of Mexico
• Agreement between NOC and Total on participation in Waha concession in Libya
• Extended Block 17 licenses to 2045 in Angola
• Acquired two offshore discoveries (Blocks 20-21) in Angola for potential development
• Signed an agreement to sell interest in Brunei offshore block CA1
• Expanded in Brazil pre-salt with new deep-offshore exploration block
• Acquired 50% interest in Surinam Block 58 with significant Maka Central-1 discovery
• Awarded construction of a large-scale (800 MW) solar power plant in Qatar
• Sold to Banque des Territoires a 50% interest in a portfolio of solar and wind assets in France
• Doubled production capacity of recycled polypropylene for auto market from Synova subsidiary
• Alliance with Zhejiang Energy Group to develop low-sulfur maritime fuel market in China
• Second agreement to supply CMA-CGM with LNG maritime fuel from Marseille

Hydrocarbon production was 3,113 thousand barrels of oil equivalent (kboe/d) in the fourth quarter 2019, an increase of 8% compared to last year, due to:

• +13% related to the start-up and ramp-up of new projects, including Yamal LNG in Russia, Egina in Nigeria, Ichthys in Australia, Kaombo in Angola, Culzean in the United Kingdom and Johan Sverdrup in Norway.
• -3% due to the natural decline of the fields.
• -2% due to maintenance and Tyra redevelopment project in Denmark.

Hydrocarbon production was 3,014 kboe/d for the year 2019, an increase of 9% compared to 2018, due to:

• +13% related to the start-up and ramp-up of new projects, including Yamal LNG in Russia, Egina in Nigeria, Ichthys in Australia, Kaombo in Angola, Culzean in the United Kingdom and Johan Sverdrup in Norway.
• -3% due to the natural decline of the fields.
• -1% due to maintenance, notably in Nigeria, Norway and Tyra redevelopment project in Denmark. 

Exploration & Production adjusted net operating income was:

• 2,031 M$ in the fourth quarter 2019, an increase of 3% year-on-year driven by the increase in production.
• 7,509 M$ for 2019, a decrease of 12% linked to lower Brent and gas prices.

Production growth over the year was essentially linked to the start-up of Ichthys in Australia in the third quarter 2018 and the successive start-ups of Yamal LNG trains in Russia.

In the fourth quarter 2019, LNG sales increased by 35% year-on-year thanks to the ramp-up of Yamal LNG and Ichthys plus the start-up of the first Cameron LNG train in the US.

In 2019, LNG sales increased by 57% compared to 2018 for the same reasons and also due to the acquisition of the Engie portfolio of LNG contracts in the third quarter 2018. 

Operating cash flow before working capital changes was 4.5 B$ in the fourth quarter, an increase of 14% compared to last year, and 18.0 B$ in 2019 an increase of 1% compared to 2018. The start-up of strong cash flow generating projects offset the impact of lower Brent and gas prices.

Summary and outlook

The environment remains volatile, given the uncertainty about hydrocarbon demand related to the outlook for global economic growth and a context of geopolitical instability.

The Group has strong capacity to generate cash flow and, in a 60 $/b environment, expects to increase it by approximately 1 B$ per year starting from 2019.

The Group will continue to implement its strategy for profitable growth on the integrated gas and low-carbon electricity chains. LNG sales will benefit notably in 2020 from the start-ups of Yamal LNG train 4 as well as Cameron LNG train 3 and be more than 30 Mt/y.

Spending discipline is maintained and the Group continues its cost reduction program with an objective of more than 5 B$ in cumulative savings in 2020. Net investments in 2020 should be on the order of 18 B$, and the Group will complete its 5 B$ asset sale program over the years 2019-20 (~3 B$ already announced).

Organic production growth should be more than 2% in 2020, thanks to ramp-ups of projects started in 2019 and expected start-ups in 2020, notably Iara 2 in Brazil. 

Link to Total France country profile