July 27, 2018 / 6:13 AM / a year ago

Eni second-quarter profit up on prices, output, but miss forecasts

MILAN (Reuters) - Italian oil producer Eni (ENI.MI) reported a 66 percent jump in second quarter profit on Friday on higher oil prices and production but fell short of analyst forecasts.

FILE PHOTO: The logo of Italian energy company Eni is seen at an Agip gas station in Lugano, Switzerland June 3, 2016. REUTERS/Arnd Wiegmann/File Photo

Adjusted net profit rose to 767 million euros ($893.3 million), but fell short of an analyst consensus forecast of 1.0 billion euros.

Eni faced higher taxes than a year earlier and its investment returns fell, its earnings showed.

Eni shares were down 0.5 percent at 0701 GMT while the European oil and gas index was up 0.07 percent.

Cash flow from operations rose 12 percent to 3 billion euros, the state-controlled company said.

It will pay an interim dividend of 0.42 euros per share having earlier flagged it would pay an annual dividend of 0.83 euros per share.

As the industry recovers from a three-year downturn some companies are starting to look for ways to reward shareholders.

On Thursday Royal Dutch Shell (RDSa.AS) launched a $25 billion share buyback while France’s Total (TOTF.PA) has begun a $5 billion purchase program.

Eni, which saw a 5 percent rise in oil and gas output in the quarter, stuck to its outlook for 4 percent growth in production for the year.

The group, which has enjoyed one of the best discovery records in the sector in recent years, said it expected output to driven by ramp-ups in Egypt, Indonesia and Ghana as well as higher production at the giant Kashagan oilfield in Norway.

Reporting by Stephen Jewkes, editing by Valentina Za and Jason Neely

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