Statoil second-quarter profit beats estimates as output rises

OSLO, Norway (Bloomberg) -- Statoil, Norway’s biggest oil and gas producer, said adjusted earnings after tax fell 27% in the second-quarter following a plunge in crude prices.

Net income excluding financial and other items fell to 7.2 billion kroner ($882 million) from 9.9 billion kroner a year earlier, the Stavanger-based company said Tuesday. Profit beat the average 5.5 billion-krone estimate in a Bloomberg survey of 20 analysts.

“Statoil delivered encouraging operational performance with good production growth and high regularity, whilst continuing to reduce cost,” Statoil’s CEO Eldar Saetre said in a statement. “Our financial results were characterized by gains from divestments and lower prices.”

Statoil and competitors such as Royal Dutch Shell and Total are cutting investments and operational costs after oil prices fell by about 50% over the last 12 months. Statoil, which operates more than 70% of Norway’s oil and gas production, said earlier this year it will reduce spending by 10% in 2015 and cut thousands of jobs in the three years through 2016.

The company, of which the Norwegian state owns a 67% stake, will pay 1.8 kroner a share in dividends for the quarter, after saying in February it would maintain payouts at that level in the year’s first three quarters despite lower oil prices. The company has been raising debt and selling assets to afford dividends and investments over the past years.

Output in the quarter rose 4% to 1.87 MMboed from a year earlier, the company said.