Low oil prices and huge losses in North America ended with a loss of 35.4 billion for Statoil in the first quarter. Statoil’s worst result ever, confirmed CEO Eldar Saetre. But the General Assembly Tuesday there will be no cuts in dividends to shareholders, who are mainly the Norwegian State.
Employees require half of the proceeds to Statoil owners
Allows debt increase
– When oil prices are low over time must Statoil must choose cutting investments very or cut dividends. Currently, Statoil neither. In the short term choose Statoil to increase the debt ratio and cut in investment from 20 billion to 18 billion this year and next year. In real terms, there is no major cuts, said oil analyst John Olaisen in ABG Sundal Colliers analysis team of oil and oil services.
– Is Statoil in a kattepine with increasing debt, billion deficit in the first quarter while the dividend policy remains unchanged?
– Yes, in a way. The debt ratio increased in the first quarter to 24 percent. It was 10 percent first quarter last year, says Olaisen.
– How long can Statoil management keep this course – when they must choose to cut in investments or dividends?
– From 2017 Statoil must make new assessments. I think we earlier in February 2016 will see results, but there are signs that Statoil begins already with the postponement of Johan Castberg and Snorre, 2014.
Debt at 40 percent?
The brokerage Goldman Sachs expecting a debt ratio of 40 percent in 2016 and 2017 and believes Statoil with it do not have much flexibility to come, writes DN / TDN Finans.
From Statoil to StatSun?
– A debt ratio of 40 percent seems high. Statoil’s goal is a debt ratio between 10 and 30 percent, says Olaisen.
Elected to Statoil has repeatedly advocated that Statoil’s management cuts in dividends. They are not being heard.
– The reason for Statoil not to cut dividend, is that shareholders do not want cuts because it is the value of the stock down, explaining Olaisen.
– Statoil awaiting oil prices
In February announced Aftenbladet that Statoil maintained its dividend policy by continuing the previous year’s increase in dividends from 7 million to 7.20 per share. After a year of cost savings and a dramatic fall in oil prices, expectations of analysts and shareholders that the group came to cut the dividend.
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But even though Statoil suffered from losses in both the third and fourth quarters, they proposed to pay out A dividend of NOK 1.80 per share, the same amount as last year. Not only that, they will also continue to pay out the same dividend in the first three quarters in 2015.
– Is there any change since February that would suggest a different policy on dividends?
– No. Statoil buys some time to see how oil prices will remain. If oil prices are up $ 90 in six months, everything is so much better.
Oil Professor Klaus Mohn at the University of Stavanger sees no tension related to Statoil’s general meeting Tuesday.
– The General Assembly Statoil is largely a formality. It collects a broad range of investors and the company discloses part message is communicated to the capital market and the public earlier. There is rarely something new comes along.
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Cause : The state owns most of its shares, and get twice as much revenue as the private owners.
– With a dominant majority owner as the state, which owns 67 percent, and acting more than predictable, the General Assembly largely a sandpåstrøingsorgan, says Mohn.
– Has something happened to side in February that would suggest cuts in dividends?
– No. Dividends were adopted in February, now it becomes formally adopted. Statoil’s management has reiterated after February dividend policy remains firm and that they will cherish it.
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