(News Bulletin 247) – Ahead of its day dedicated to investors, the oil major indicated that it would allocate $8 billion for repurchases of its own securities in 2024. For 2025, the amount is planned at $2 billion per quarter. The company also raised its forecast for medium-term hydrocarbon production.

Like every year, Totalenergies takes stock of its forecasts in the fall. Ahead of its day dedicated to investors, the oil major gave several major guidelines, including those on shareholder return, an important point for groups specializing in hydrocarbons.

The company said it expects approximately $8 billion in share repurchases for 2024. This is a continuation of the company’s previous actions, which had repurchased $4 billion worth of securities in the first half and plans to acquire $2 billion in the third.

The shareholder return for 2024, which also includes the payment of dividends, is expected to exceed 45% of the cash flow, the company said.

During its previous investor day, Totalenergies decided to allocate $9 billion to share buybacks for 2023. But this amount included around $1.5 billion that had been taken from the sale of the tar sands activities in Canada and therefore reallocated to share buybacks.

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Hydrocarbon production forecast raised

For 2025, Totalenergies announced that it would “continue share buybacks at a rate of $2 billion per quarter under reasonable market conditions, and increase the dividend by at least 5% taking into account the share buybacks carried out in 2024 “. In 2023 and 2024 the dividend was increased by 7%.

The company also confirmed that it expects between 16 billion and 18 billion dollars in net investments over the period 2025-2030, with around 5 billion dedicated to “low-carbon” energies. “The company, however, retains the flexibility to reduce its net investments by 2 billion in the event of a sharp drop in prices,” warned the company.

Based on this forecast, Totalenergies intends to increase its cash flow by approximately $10 billion by 2030, compared to 2024. This allows the company to confirm its prospect of a return to shareholders. which would exceed 40% of cash flow “through cycles”.

The company also raised its forecast for growth in hydrocarbon production, counting on around 3% per year over the period 2024-2030 and more than 3% per year in 2025 and 2026, thanks to liquefied natural gas (LNG) and via the launch of several “high margin” projects. In 2023, Totalenergies forecast growth of 2% to 3% per year over “the next five years”. The group anticipates growth of 50% in LNG between 2023 and 2030.

Also including its electricity and bioenergy production, the company expects its energy production to increase by 4% per year until 2030.

Concerning its listing project in New York, the general director, Patrick Pouyanné told analysts that he was working on this project which the board of directors unanimously supports, according to comments reported by the Reuters agency.

On the Paris Stock Exchange, Totalenergies shares rose 3% around 4 p.m., after these announcements. The stock was already moving roughly on this progression before the company’s communication, driven by the sharp rise in oil prices with the renewed tensions in the Middle East.

“Totalenergies’ decision to maintain both its distribution ratio and its repurchase rate (editor’s note) until 2025 despite a weaker macroeconomic situation and ‘assuming reasonable market conditions’ is in line with our expectations , while being likely to be perceived as reassuring by investors,” wrote Royal Bank of Canada in a note in reaction to these announcements.

“With a well-defined strategy, the focus should be on execution, with a number of projects to be delivered in the coming years to help drive free cash flow growth through 2030 and beyond “, adds the Canadian bank.