Spain's Repsol reported a 28% fall in first-quarter profit on Tuesday, becoming the latest oil and gas company to show the deep damage done to its balance sheet by the coronavirus laying waste to energy demand.
Oil prices fell 65% in the period as restrictions on movement to halt the spread of the virus paralyzed industry and travel, erasing appetite for fuel which was further cheapened by a price war between top producers Saudi Arabia and Russia.
"The effects of the COVID-19 pandemic are having a significant effect on demand, resulting in an excess of supply not seen in decades that is weighing on oil prices," Repsol said in a statement, referring to the infection caused by the virus.
"It is difficult to predict to what extent and for how long the impact of the pandemic will affect Repsol's businesses in the future," it added, but said there may be a negative impact on prices and production and sales volumes as well as the cost of capital and the solvency of its clients and partners.
Adjusted net profit fell 28% to 447 million euros ($487.5 million), much higher than an estimate of 330 million euros based on analyst forecasts compiled by the company.
Repsol's upstream division, which explores and drills new wells, suffered the most. Adding to the pain from the slump in crude prices, its other key benchmark, Henry Hub gas, was 35.5% lower than in early 2019.
Downstream activities, or refining and selling products, fared a little better thanks to higher refining margins in Peru, and on wholesale and gas trading provided a boost, while losses from intra-group oil sales narrowed year-on-year.
Repsol has already slashed 2020 spending plans.
It maintained a dividend of 1 euro per share, but scrapped a plan to reduce the number of shares by 5%. A plan to reduce carbon emissions to net-zero remained intact, it said.
Bigger French peer Total reported a 35% fall in its own net profit on Tuesday.
Repsol stock has fallen 44.6% so far this year, lagging the sector index .SXEP which has fallen 37.2% in that time.
($1 = 0.9168 euros)
(Reporting by Isla Binnie, editing by Louise Heavens)