TotalEnergies raises dividend, buybacks and hackles over war-related profits
By America Hernandez
TotalEnergies' Financial Performance and Market Impact
Dividend Increase and Share Buybacks
PARIS, April 29 - TotalEnergies raised its dividend and doubled its share buybacks on Wednesday, triggering calls in France for a supertax on its windfall profits to aid consumers hit by a spike in energy costs linked to the Iran war.
Total beat expectations with adjusted first-quarter net income of $5.4 billion, a 29% jump from a year ago boosted by strong trading. Analysts had expected $5 billion, according to LSEG data.
Its shares rose as much as 1.3% but later pared gains to trade little changed at 1551 GMT, still up around 40% so far this year.
The conflict has caused unprecedented disruption of energy markets, forcing Total to shut in 15% of its upstream output and pushing up global energy prices, providing a windfall for some producing countries and oil majors.
Political Response and Windfall Tax Proposals
New Windfall Profit Tax Proposed
NEW WINDFALL PROFIT TAX PROPOSED
"Exceptional results raise the question of an exceptional, proportionate redistribution ... one option being through fiscal means. No doors are closed," Prime Minister Sebastien Lecornu told senators on Wednesday after the opposition Socialist Party proposed a law imposing a minimum 20% tax on crisis-related windfall profits.
Last year Total paid no French tax, as its trading profits are booked mostly in Switzerland while its French refineries were loss-making.
It has voluntarily capped prices at the pump at its French service stations since the crisis began.
Shareholder Returns and Industry Comparison
Share Buybacks Are Back on the Rise
SHARE BUYBACKS ARE BACK ON THE RISE
CEO Patrick Pouyanne said he expected higher oil and gas prices to last the year.
"No one knows how long this war will last ... but all scenarios I read expect oil prices of at least $80 per barrel for 2026," he told analysts on a call.
The French energy company announced a 5.9% dividend increase and will buy back $1.5 billion in shares in the second quarter, a turnaround after it slowed purchases and announced a cost-savings programme in late 2025 on the expectation low oil prices would fall further.
Benchmark Brent crude futures climbed to multi‑year highs near $120 a barrel after U.S.-Israeli strikes on Iran began in late February, followed by Tehran’s closure of the Strait of Hormuz and its attacks on Gulf neighbours.
Industry Peers' Reactions
Other majors yet to report first-quarter results could also boost shareholder returns with strong profits.
Italian rival Eni nearly doubled its share buybacks on expectations the war would keep energy prices higher for longer, though BP declined to boost investor returns with its war-related trading profits.
RBC analysts said U.S. major Chevron, which reports on Friday, could return more cash to shareholders given its plans originally assumed oil prices of $60 to $80 per barrel.
HSBC, however, expected other majors to be prudent.
"We don't believe Shell, Chevron or ExxonMobil will feel any kind of pressure to follow suit ... as companies will prioritise deleveraging and capital discipline in an uncertain macro environment," said HSBC analyst Kim Fustier.
Business Segments and Project Updates
All Business Segments Up, Projects on Track
ALL BUSINESS SEGMENTS UP, PROJECTS ON TRACK
Total, which already flagged earlier this month the positive effect the war-driven oil price rise would have on its income, said earnings were up across all business segments.
Refining and chemicals, home to Total's oil and petroleum products trading, delivered an eye-popping fivefold increase to $1.6 billion for the quarter.
Major Projects and Future Outlook
Projects in Saudi Arabia, Iraq and Qatar are progressing, but any production restart is dependent upon stable transit through the Strait of Hormuz, Pouyanne said.
In Namibia, Total hopes to take a final investment decision on its Venus development by end-July, and on its Mopane discovery in 2028.
In Uganda, the EACOP pipeline may be completed by September, with oil from the Kingfisher development operated by China's CNOOC able to feed into it by summer's end, the CEO said.
(Reporting by America Hernandez in Paris and Mateusz Rabiega in Gdansk; additional reporting by Stephanie Kelly in London and Elisabeth Pineau in Paris; Editing by Barbara Lewis, Bernadette Baum and Tomasz Janowski)
