Var Energi on Wednesday reported a decline in net profit for the first quarter even as top-line income expanded sharply, supported by a combination of increased output and firmer realised oil and gas prices.
Net profit for the three months to March was $374 million, down from $453 million a year earlier, the company said. Despite the drop in net profit, profit before tax increased to $1.41 billion from $1.28 billion in the same period a year earlier. Operating profit rose to $1.31 billion, reflecting the contribution of stronger realised prices and higher production levels.
The company reported total income of $2.67 billion for the quarter, up from $1.87 billion in the prior-year period, with petroleum revenues accounting for $2.66 billion of that amount.
Var Energi recorded a quarterly production average of 406,000 barrels of oil equivalent per day (boepd), a record level and a substantial increase from 272,000 boepd a year earlier. The company attributed the rise to improved performance across key assets and the ramp-up of projects.
On shareholder returns, Var Energi maintained a dividend of $300 million for the first quarter and indicated it expects to make a similar payout in the second quarter.
Chief Executive Nick Walker said the company was "well positioned in volatile markets," highlighting stable operations in the face of geopolitical tensions and noting Var Energi's role as a key supplier of energy from Norway.
The firm reiterated its full-year production guidance of 390,000 to 410,000 boepd and said it expects production costs to remain around $10 per barrel.
This report lays out the company figures for the first quarter and its near-term outlook, without making forecasts beyond the metrics and guidance Var Energi provided.