France’s Total sees setback in Q1 profits as petrochemicals slip

30-Apr-12

French oil company Total saw its revenues grow strongly in Q1-2012, but saw a drop in European demand for petrochemicals hit profits, as per AP Business Writer. The quarter saw energy prices soar amid unrest in the Middle East and tension in Iran, even as economic slowdown in Europe continues to weigh on demand. Those high prices have buoyed Total's production business, but other sectors are struggling amid the poor economic environment. In addition to weak demand for petrochemicals, the company said the sale of a Spanish oil company decreased refining output. That business was also hurt by a decrease in refining margins. The company has also suffered a couple of natural gas leaks in recent weeks, one in the North Sea and another in Nigeria. France's largest company by market value reported Friday that net profit fell 7% to Euro 3.7 bln (US$4.9 bln) for January to March. Revenues, however, rose 11% to Euro 51.2 bln, beating the average expectation of analysts surveyed by FactSet of Euro 48 bln. In the business group that includes refining and chemicals, adjusted net operating income dropped 77% over the same quarter last year.