The return on capital employed (1) over the past 12 months was 24.6 per cent, compared with 19.2 per cent for the same period of 2004. Normalised (1) the return was 12.4 per cent as against 13.1 per cent in the first quarter of last year.
“We have delivered a strong result in the first quarter of 2005, our best-ever from operations,” says chief executive Helge Lund.
“The improved result is mainly due to higher prices of oil and gas, favourable margin developments for refining and petrochemicals, as well as good control of costs.
“This has been a quarter with high business development activity, which provides good support for further progress, both on the Norwegian continental shelf and internationally.
“The recent acquisition in the Gulf of Mexico plays directly on Statoil’s skills and strategy as a global deepwater player, and provides both a new core area and significant long-term growth opportunities.
“On the Norwegian continental shelf the Kristin platform is in position on the field, and is being prepared to start gas deliveries on 1 October. I am also pleased that the plans for Statfjord late life have been submitted to the authorities.”
|
First quarter,
|
Full year
|
||||
|
2005
|
2004
|
2005
|
2004
|
||
| (in millions) |
NOK
|
NOK
|
change
|
USD*
|
NOK
|
| US GAAP income statement | |||||
| Total revenues |
84,623
|
67,030
|
26%
|
13,337
|
306,218
|
| E&P Norway |
16,472
|
11,605
|
42%
|
2,596
|
51,029
|
| International E&P |
1,627
|
714
|
128%
|
256
|
4,188
|
| Natural Gas |
1,555
|
2,905
|
(46%)
|
245
|
6,784
|
| Manufacturing & Marketing |
1,950
|
859
|
127%
|
307
|
3,921
|
| Other |
(103)
|
(38)
|
(171%)
|
(16)
|
(815)
|
| Income before financial items, income taxes and minority interest |
21,501
|
16,045
|
34%
|
3,389
|
65,107
|
| Net financial items |
(1,747)
|
(1,015)
|
(72%)
|
(275)
|
5,739
|
| Income before income taxes and minority interest |
19,754
|
15,030
|
31%
|
3,113
|
70,846
|
| Income taxes |
(12,831)
|
(10,227)
|
25%
|
(2,022)
|
(45,425)
|
| Minority interest |
(150)
|
(103)
|
46%
|
(24)
|
(505)
|
| Net income |
6,773
|
4,700
|
44%
|
1,067
|
24,916
|
| Earnings per share |
3.13
|
2.17
|
44%
|
0.49
|
11.50
|
| Weighted average number of ordinary shares outstanding |
2,166,032,462
|
2,166,143,715
|
2,166,142,636
|
||
| * Solely for the convenience of the reader, the first quarter of 2005 has been translated into US dollars at the rate of NOK 6,3451 to USD 1.00, the Federal Reserve noon buying rate in the City of New York on March 31, 2005. | |||||
Statoil’s improved profits primarily reflect price rises of 32 per cent for oil and 21 per cent for gas measured in Norwegian kroner. In addition come the strengthened downstream results.
The increase in profit was partly offset by NOK 0.2 billion in higher depreciation internationally relating to larger oil and gas sales and to new fields coming on stream. The sale of Statoil’s shares in Verbundnetz Gas (VNG) contributed NOK 0.6 billion to results in the first quarter of 2004.
Total revenues came to NOK 84.6 billion, as against NOK 67.0 billion in the first quarter of 2004.
The group’s oil and gas production in the first quarter averaged 1,189,000 barrels of oil equivalent per day (boe/d), as against 1,184,000 boe/d for the same period of last year.
Five exploration wells were completed during the quarter, two on the NCS and three internationally.
Net financial expenses totalled NOK 1.7 billion for the first quarter compared with NOK 1.0 billion in the same period of 2004. This rise primarily reflects realised currency losses on the group’s short-term liquidity balances, which were partly offset by lower financial expenses and higher return on investment.
Income taxes for the first quarter totalled NOK 12.8 billion, corresponding to a tax rate of 65 per cent. Comparable figures for January-March 2004 were NOK 10.2 billion and 68 per cent. The reduced tax rate can primarily be attributed to the fact that a larger portion of pre-tax income derived from operations not subject to Norwegian petroleum taxation.
Statoil was hit by a fatality on 31 January when a person at the Aker Stord yard near Bergen suffered a fatal accident in connection with work on the Kristin platform.
The total recordable injury frequency – the number of injuries suffered by Statoil employees and contractor personnel per million working hours – was 5.5, compared with 6.5 in the first quarter of 2004.
Statoil’s serious incident frequency per million working hours came to 3.1 as against 3.6 for January-March last year.
”The overall and long-term trend shows a positive development for health, safety and the environment,” notes Mr Lund. ”But several serious incidents recently emphasise that safety work must continue with full force.”
Important events in the first quarter of 2005 are summarised below:
- The plans for development and operation (PDO) of Volve, Fram Øst and Statfjord late life, plus the plan for installation and operation (PIO) for the Tampen Link pipeline, were submitted to the Ministry of Petroleum and Energy in February. The Volve and Fram Øst PDOs were approved on 22 April, 2005.
- Test production of the Topas discovery began on 23 February, 2005.
- Exploration drilling in the Barents sea began from the Eirik Raude rig on 4 April, 2005. Work was temporarily halted following an unwanted spill of hydraulic oil on 12 April, 2005.
- On behalf of a group of license operators, including Hydro, Shell, and ENI, Statoil signed Letters of Intent (LOI) with Transocean and Smedvig covering charters for the West Alpha, Transocean Arctic and Polar Pioneer rigs.
- The PDO submitted for Skinfaks and Rimfaks near Gullfaks were approved by the authorities on 11 February, 2005.
- Snorre A and Vigdis were brought back on stream after the well incident in November 2004. A project team has been established to follow up the measures adopted following the investigations into that event. The project team reports directly to the Executive Committee.
- Statoil and EnCana Corporation signed an agreement which involves the acquisition by Statoil of EnCana's entire deepwater portfolio in the Gulf of Mexico. This contains several high quality discoveries and a number of attractive exploration prospects. Statoil´s share of production is expected to be 30,000 barrels of oil equivalent per day by 2008-9, rising to more than 100,000 barrels of oil equivalent per day after 2012.
- The Central Azeri part of the Azeri-Chirag-Gunashli (ACG) oil field in Azerbaijan´s sector of the Caspian began producing on 13 February, 2005.
- A unitisation agreement for the Agbami field development off Nigeria was signed and approved by the Nigerian government.
- The Council of Ministers in Algeria approved the award of the Hassi Mouina exploration licence to Statoil, and the final approval (gazettal) was issued in February 2005.
- Higher production permits for the fields Oseberg, Sleipner, Troll and Åsgard were approved by the Ministry of Petroleum and Energy. This will contribute to expanded production capacity in the 2004-06 gas years.
- The Norwegian state reduced its shareholding in Statoil from 76.3 per cent to 70.9 per cent in February 2005.
Further information from:
Press:
Kjersti T Morstøl, +47 51 99 26 71 (office), +47 91 78 28 14 (mobile)
Investor relations:
Mari Thjømøe, +47 51 99 77 90 (office), +47 90 77 78 24 (mobile)
Investor relations, USA:
Geir Bjørnstad, +1 203 570 5757
| 1) Capital employed is calculated as follows: | ||||
|
At March 31,
|
At March 31,
|
At December 31,
|
||
|
2005
|
2004
|
2004
|
||
| Shareholders' equity, minority interest, short- and long-term debt less | ||||
| cash, cash equivalents and short-term investments |
99,842
|
88,956
|
106,186
|
|
| Adjusted for project loan and other |
(57)
|
220
|
786
|
|
| Capital employed |
99,785
|
89,176
|
106,972
|
|
| Adjustment cash build-up before tax payment |
11,000
|
8,600
|
0
|
|
| Adjusted capital employed |
110,785
|
97,776
|
106,972
|
|
| 1) The return on capital employed (ROACE) is calculated as follows: | ||||
|
First quarter 2005
|
ROACE %
|
First quarter 2004
|
ROACE %
|
|
| Net income last 12 months |
26,989
|
17,662
|
||
| Minority interest, net financial items after tax and miscellaneous |
(1,292)
|
(347)
|
||
| Net income used in ROACE calculation |
25,697
|
27.2%
|
17,315
|
21.0%
|
| Effect of normalised prices, refining margins, exchange rates and other |
(12,810)
|
(6,602)
|
||
| Net income used for normalised ROACE |
12,887
|
12.4%
|
10,713
|
12.4%
|
| First quarter 2004 new normalisation |
13.1%
|
|||
| Average capital employed |
94,399
|
82,262
|
||
| Average capital employed, normalised |
104,280
|
86,268
|
||
Operational data
|
First quarter,
|
Full year
|
|||
|
2005
|
2004
|
change
|
2004
|
|
| Average oil price (USD/bbl) |
46.6
|
32.2
|
45%
|
38.1
|
| NOK/USD average daily exchange rate |
6.28
|
6.91
|
(9%)
|
6.74
|
| Average oil price (NOK/bbl) |
293
|
222
|
32%
|
257
|
| Gas prices (NOK/scm) |
1.32
|
1.09
|
21%
|
1.10
|
| Refining margin, FCC (USD/boe) |
5.0
|
4.9
|
2%
|
6.4
|
| Total oil and gas production (1000 boe/day) |
1,189
|
1,184
|
0%
|
1,106
|
| Total oil and gas liftings (1000 boe/day) |
1,189
|
1,166
|
2%
|
1,094
|
| Production (lifting) cost (NOK/boe, last 12 months) |
22.9
|
22.3
|
3%
|
23.4
|
| Production (lifting) cost normalised (NOK/boe, last 12 months) |
23.0
|
22.2
|
3%
|
23.5
|
Financial statements and review - first quarter 2005
MD&A
Presentation set
Webcast with president and CEO Helge Lund