French oil major Total SA beat analysts' forecasts to report a 35 per cent jump in third quarter underlying profits, as high oil prices and strong refining margins made up for a drop in crude and gas production.
The group said in a statement today that it was confident it could "maintain competitive dividend growth", even in an environment where oil prices are trading at less than half their record level above $147/barrel in July.
The Paris-based firm said net profit, excluding one-off items and unrealised gains or losses related to changes in the value of fuel inventories, was €4.07 billion ($5.23 billion) against €3 billion in the same period in 2007.
In a Reuters poll of 12 analysts, adjusted net profit was seen at an average €3.855 billion, up 28.3 per cent.
Oddo Securities analysts welcomed a set of "very good results", with upstream activities driven by high crude prices and downstream by "excellent refining margins."
However, David Thomas, oil analyst at Citigroup said in a research note the results were "nothing outstanding".
The group's shares were down 2.74 per cent at €43.28 at 9.40am, outperforming a 3.63 per cent slide in the DJ Stoxx European oil and gas sector index.
Total, the world's fifth-largest non-government controlled oil company by market capitalisation, said production in the third quarter fell 5 per cent to 2.231 million barrels of oil equivalent per day, slightly below analysts' expectations.
"(The fall) may again disappoint investors keen to see outright volume growth," Mr Thomas said.
The output fall was due to natural field decline and outages related to problems at fields in Libya and the North Sea and civil violence in Nigeria.
Most rivals are also facing output falls. Industry number two Royal Dutch Shell said production fell 7 per cent in the third quarter, and industry leader Exxon Mobil's output fell 8 per cent.
Despite a sharp drop in oil prices since the summer, Total said its $19 billion 2008 investment programme was "progressing as planned" and that five major projects will commence output in 2009.
Total gave no group forecast for 2008 or 2009 and did not repeat a target for annual growth in production of close to 3 per cent, announced alongside second-quarter results in August.