On 23 February Eni will lift the veil on its quarterly results and Equita expects operating profits to decline on a sequential basis mainly due to the drop in hydrocarbon prices which will affect the profits of E&P and GGP.
Sim analysts believe that upstream production does not show large recoveries compared to the third quarter of 2022 and E&P may also be affected by (non-cash) exploration costs. The R&M division is expected to show a sequential decline even if on absolute levels that are still very positive. Plenitude should hit the guidance SIM analysts say according to which in terms of cash generation, the fourth quarter is still expected to be strong and will allow Eni to exceed the 20 billion euro target of CFFO adj., also improving the leverage target at 15%.
Equita slightly raises FY22 EPS estimate by 1% expecting indications on upstream production growth at LSD CAGR (previous plan +3% CAGR) with growing gas exposure, capex increase due to gas discoveries and supply expansion towards Europe. The percentage of green investments will be reasonably higher than the 25% of the previous plan and a potential simplification of the shareholder remuneration policy with a direct link to cash generation.