Norway’s Equinor posted record pretax profits for the fourth quarter on Wednesday, driven by a boom in oil and gas prices and said it will raise its dividend and increase share buybacks.
Adjusted earnings before tax rose to $15.0 billion in the October-December quarter from $756 million in the same period a year ago, exceeding the $13.2 billion predicted in a poll of 23 analysts compiled by Equinor.
CEO Anders Opedal said Equinor enjoyed a free cash flow of $25 billion last year as a result of “continued improvements and capital discipline”.
“We are capturing value from high prices for gas and liquids with excellent performance and increased production,” he said a in statement.
The oil and gas industry saw a massive turnaround last year as markets overcame the pandemic-driven slump of 2020, with the price of European natural gas quadrupling between January and December while North Sea crude rose more than 50%.
Majority state-owned Equinor said it would pay a quarterly dividend of $0.20 per share, up from $0.18 per share paid in the third quarter, and plans to increase its share buybacks in 2022 to $5 billion from $1.3 billion in 2021.
European oil industry peers have also posted soaring profits in recent days, with BP (NYSE:BP) promising to increase its share buybacks and Shell (LON:RDSa) saying it will raise both dividends and its stock purchases.
Equinor’s quarterly petroleum production stood at 2.16 million barrels of oil equivalent per day (boepd) in the fourth quarter, up 6% from the same period of 2020.
The company expects its oil and gas production to grow by 2% in 2022.
Equinor’s shares have risen 63% in the last 12 months, more than double the rise in the European oil and gas index.