Repsol It is preparing to overcome the turbulence that the expansion of the Covid-19 pandemic will cause in the economy. The energy company has informed the CNMV today that will adopt a 2020 Resilience Plan for its businesses, considering a macroeconomic environment “very demanding for the rest of the year”, with a price of a barrel of Brent oil averaged at $ 35 a barrel in the period from April to December and the Henry Hub (gas) of $ 1.8 / MBtu. The Resilience Plan also contemplates the launch of initiatives that imply added reductions of more than 350 million euros in operating expenses and more than 1,000 million in investments, as well as optimizations of working capital of close to 800 million euros with respect to the metrics initially budgeted.
Despite these measures, The company maintains its commitment to pay a dividend of one euro per share, of which 0.45 euros were already distributed in January and another 0.55 euros will be paid in July using the “scrip dividend” formula. What is postponed is the presentation of its new Strategic Plan 2020-2025, scheduled for May, until “greater social and business stability” is envisioned, as explained by the corporation.
Repsol’s board of directors has also decided not include on the agenda of its next general shareholders’ meeting, to be held on May 8, the proposed reduction of 5% of the share capital figure of the company as of December 31, 2018, agreed in July 2019, “due to the current situation in the markets and the circumstances that have arisen as a result of Covid-19,” as explained.
Given the change in outlook that the pandemic has introduced, Repsol has assured that Its financial objective will be “to preserve the soundness of our financial balance and the degree of credit investment.” Currently, its position within the credit rating is “robust, backed by the recent communication from S&P affirming our rating at the BBB level with a stable outlook,” as explained. Repsol ensures that it also has comfortable liquidity that allows it to cover its debt maturities in the short term and beyond, until 2024, without the need for refinancing.