Today’s market chatter: Repsol sees profits rise; Applus ready for IPO


Spanish oil major Repsol saw profits rise by  27.3% year-on-year, as it completed its Argentine exit with $1.3 billion YPF sale. Net income for the first three months of the year totalled €807 million ($1.1 billion), up from 2013’s first quarter profit of €634 million. Its debt was reduced by 11% thanks to selling GNL to Shell and TGP to Enagás.

This performance prompts Bankia to maintain its recommendation about the firm. Bankinter analysts explain that results have suffered from some production stops whereas impact was lower than expected; on the other hand, Repsol took advantage of the harsh weather in North America, that caused bigger gas sales, but it is bound to fizzle out. ACF reminds that the oil firm is very likely to partially execute the monetization of YPF compensation bonds and it will be incorporated in share price. It will have to convey that new investments fulfillment risk is low and operations create value for shareholders.

Testing and inspection company Applus set IPO price at 14.50€ a share, its net value based on that price being €1.88bn.

Banco Santander will issue preference shares convertible into common shares worth $2.5bn, limited to qualified investors.  Renta 4 considers such operation value and a conversion price with 10%-20% premium, it would entail placing about 2% of current social capital.

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The Corner
The Corner has a team of on-the-ground reporters in capital cities ranging from New York to Beijing. Their stories are edited by the teams at the Spanish magazine Consejeros (for members of companies’ boards of directors) and at the stock market news site Consenso Del Mercado (market consensus). They have worked in economics and communication for over 25 years.

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