E — Eni S.p.A.

Eni Q1 2026 Earnings Call Summary

1. Key Financial Results and Metrics

• Pro Forma EBIT: EUR 3.5 billion
• Cash Flow from Operations: EUR 2.9 billion
• Pro Forma Gearing: 15% (12% when accounting for Plenitude deconsolidation)
• CapEx: EUR 1.9 billion, on track for EUR 7 billion for the year
• Tax Rate: 42%, consistent with guidance
• Working Capital: Experienced a significant negative impact due to price spikes in March, expected to reverse in upcoming quarters.
• Share Buyback: Increased to EUR 2.8 billion, a 90% rise from previous plans.

2. Strategic Updates and Business Highlights

• Exploration Success: Eni reported a record start to the year with significant discoveries in multiple countries, including:
  • 500 million barrels of oil in Angola (Algaita)
  • 5 Tcf of gas and 450 million barrels in Côte d'Ivoire
  • 2 Tcf of gas in Libya
  • 5 Tcf of gas in Indonesia (Geliga)
• Production Growth: Year-on-year production growth of 9%, particularly strong contributions from Norway and Congo.
• Transition Initiatives: Advancements in biorefineries and the reorganization of Plenitude.
• Downstream Performance: Lower refinery utilization due to maintenance, but expected to improve in the latter half of the year.

3. Forward Guidance and Outlook

• Production Growth: Confirmed guidance of 3-4% growth for E&P production.
• Market Scenario Projections: Increased Brent price forecast to $83 per barrel and TTF to EUR 50 per megawatt hour.
• Cash Flow from Operations: Expected to reach EUR 13.8 billion, a 20% increase from previous estimates.
• Distribution Policy: New policy to be proposed at the AGM, maintaining a floor even in adverse scenarios.

4. Bad News, Challenges, or Points of Concern

• Downstream and Biorefineries: Underperformed in Q1 due to traditional maintenance; potential for margin pressure due to high feedstock prices.
• Middle East Disruption: Limited exposure but potential impacts on supply contracts and production.
• Working Capital: Significant negative impact from price spikes, with expectations for reversal but uncertainty remains.
• Market Volatility: Ongoing geopolitical tensions affecting energy prices and supply chains.

5. Notable Q&A Insights

• Transformation Costs: EUR 55 million in transformation costs expected to yield annualized efficiency savings of around EUR 50 million.
• Indonesia Exploration: New discoveries in Indonesia may lead to increased production targets, potentially reaching 700-750,000 barrels per day.
• Biofuels Market: Concerns about the affordability of biofuels, particularly sustainable aviation fuel (SAF), given current pricing pressures.
• Venezuela Receivables: Eni expects to recover more than the estimated $1 billion from outstanding receivables due to new agreements.
• Demand Destruction: Management believes that while there may be some demand reduction, significant destruction is not evident yet.

This summary encapsulates Eni's financial performance, strategic initiatives, and outlook while addressing potential challenges and insights from the Q&A session.