TotalEnergies Q2 Indicators; Not A Spread Mover

TTEFP; A3[P]/A-/Au

• Not a spread mover ahead of full results on 25 July though the update does indicate that most results should be broadly in line with guidance while also noting the impact of lower refining margins like we’ve seen elsewhere.
  
  
• Hydrocarbon production is expected to be within the high end of the guidance range, close to 2.45 Mboe/d (guidance had been for 2.4-2.45mboepd. This will feed through to E&P (just under half of FY23 revs and op income as per BBG) though will be partially offset by gas realisations).
• Integrated L&G (~5% of FY23 revenue but ~22% of op profit as per BBG) seen broadly in line with Q1 while reflecting the slight decrease in realised prices (average LNG price of USD 9.32/mbtu vs. USD 9.58 in Q1).
• Integrated Power (~12% of FY23 revenue and op profit) seen at USD 500mn (Q124 ne op income was USD 611mn) with a quarterly cash flow in line with the USD 2.5-3bn annual guidance).
• Downstream results will be impacted by lower refining margins in Europe (European Refining Margin Marker of USD 44.9/t from USD 71.7 in Q1) but will be offset by higher utilisation and better marketing results.