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Investing.com -- Repsol (BME:REP) reported first-quarter earnings that beat analyst expectations and said it will stick to its dividend policy even if market conditions worsen.
The Spanish energy group reported an adjusted net profit of €651 million ($741 million) for the quarter, down 48% from the previous year but ahead of the €642 million average forecast provided by the company.
The result came in stronger than expected despite a sharp decline in refining margins, softer oil prices, reduced profitability in its chemicals division, and broader market volatility.
“During the first quarter of 2025, we have laid the groundwork to meet our objectives for the year, ensuring our commitment to shareholder remuneration, optimising investments and improving our portfolio through divestments that will represent a cash inflow of around 700 million euros,” Repsol (OTC:REPYY) CEO Josu Jon Imaz said.
The company reaffirmed its shareholder payout policy, aiming to distribute between 30% and 35% of cash flow from operations—even in a tougher market environment.
It said it would maintain that target even if refining margins drop to $4 per barrel and Brent crude falls to $65 per barrel. In the first quarter, Brent averaged $76 and refining margins stood at $5.3.
Should such a scenario unfold, Repsol expects reduced cash flow from operations and plans to adjust its investment levels accordingly.
"Heading into results, there may have been some expectation that Repsol would reduce its buyback for the year, however it looks like the company is holding firm for now," RBC Capital Markets analysts said in a note to clients.
Including extraordinary items such as provisions, divestments, and inventory effects, net profit dropped to €366 million from €969 million a year earlier.