Repsol earns 13% less due to the drop in gas prices, but maintains its profit above pre-covid levels

The decline in gas prices has impacted Repsol’s first-quarter performance. The company, led by Josu Jon Imaz, reported a net result of 969 million between January and March, a decrease of almost 13% compared to the same period last year. However, the figure remains higher than pre-pandemic levels, excluding the years affected by the Ukraine invasion in 2021 and 2022.

The adjusted net result, which excludes extraordinary factors such as price fluctuations, was 1,267 million, a decline of 624 million compared to the first three months of 2023.

The decrease in profits was greater than the decline in revenue. Repsol’s sales amounted to 15,083 million up until March, a 1.4% decrease compared to the same period in 2023. Investments reached 2,129 million euros, with more than half allocated to low-carbon activities, including the acquisition of ConnectGen, a developer of renewable electricity projects in the United States, for 715 million.

This investment focus led to an increase in net debt, which stood at 3,901 million euros at the end of the quarter, more than double the figure at the end of 2023 (2,096 million euros).

In the Exploration and Production segment, the adjusted result was 442 million, a 7% decrease compared to the same period in 2023. Total production reached 590,000 barrels of oil equivalent per day. Repsol attributed this decline to lower gas prices, increased depreciation, higher exploration and production costs, and the divestment of productive assets in Canada, which had a negative impact of 17 million euros.

In the Customer business, the adjusted result was 156 million, 18 million less than in the same period of 2023. The decrease was primarily due to lower results in Mobility and LPG, offset partially by higher results in Electricity and Gas Marketing, Lubricants, and Aviation.

Historically, Repsol’s performance has been tied to the fluctuation of oil and gas prices, but the company’s diversification strategy has helped mitigate the impact of these swings.

The company aims to double its customer base in electricity and gas, reaching 4 million by 2027, and strengthen its position in the electricity marketing market, where it is already the fourth-largest operator with a 6% market share. Repsol’s multi-energy approach has attracted attention in the electricity sector and has resulted in legal action from Iberdrola, accusing Repsol of “unfair competition and ecological money laundering.”