reports
- Alyssa Gammoudy
- Hendrik Wiersma
- Jeroen van den Broek
- Nadège Tillier
- Suvi Platerink Kosonen
- Timothy Rahill
Coffee, Croissants & Credit/CSPP and PEPP, Banco Santander, HSBC, BAWA...
Strategy Another week of high CSPP net purchases brings monthly total to over €4.6bn Financials Banco Santander: The worst is behind us? HSBC 3Q20: Revenue pressures intensify, strong capital for now BAWAG: Risk costs still the centre of attention in 3Q20 Consumers Nestlé: New factory in Ohio (US) planned Diageo: Acquires Chase distillery Utilities BP: despite a better third quarter, 9M20 financial results remain weak
- Nadège Tillier
- Warren Patterson
European oil & gas majors/Short term remains bearish
The short term still looks challenging for the oil & gas industry despite the price recovery we have seen from the lows in April. A number of agencies have recently revised lower their demand projections for the remainder of this year and through 2021, with the recovery in demand clearly taking longer than initially expected. As a result, the move higher in oil prices has also stalled, with ICE Brent largely trading in a US$40-45/bbl range. Meanwhile, the natural gas market was already set to be...
- Alyssa Gammoudy
- Hendrik Wiersma
- Jeroen van den Broek
- Nadège Tillier
- Suvi Platerink Kosonen
- Timothy Rahill
Coffee, Croissants & Credit/CSPP and PEPP, Diageo and BP
Strategy Corporate purchases under PEPP fall to €7bn for June and July Consumers Diageo FY results: credit metrics take a deep dive, credit rating should be safe (for now) Utilities BP: Record losses in 1H20 but some credit friendly measures
- Alyssa Gammoudy
- Hendrik Wiersma
- Jeroen van den Broek
- Nadège Tillier
- Suvi Platerink Kosonen
- Timothy Rahill
- Alyssa Gammoudy
- Hendrik Wiersma
- Jeroen van den Broek
- Nadège Tillier
- Suvi Platerink Kosonen
- Timothy Rahill
- Alyssa Gammoudy
- Hendrik Wiersma
- Jeroen van den Broek
- Nadège Tillier
- Suvi Platerink Kosonen
- Timothy Rahill
- Nadège Tillier
- Quirijn Mulder
- Warren Patterson
IG European oil & gas majors/Resilience tested again
Already suffering from an oil and gas oversupply across the globe, the Covid-19 outbreak is pushing the energy sector to revise its business plans for 2020. Our Commodities Research Strategist Warren Patterson now factors a 2MMbl/day decline in oil consumption in 2020 due to the worldwide pandemic. This contrasts with an anticipated 0.9MMbl/day increase in consumption before the crisis by the International Energy Agency (IEA). European oil & gas majors are responding to the situation with share ...
- Nadège Tillier
European oil & gas/Catching a falling knife?
The iBoxx IG € Energy index has underperformed significantly year-to-date. The sector has widened by 23bp YTD while, at the same time, the iBoxx IG € Utilities benchmark has widened by 10bp. In 2019 the Energy sector also underperformed other sector indices. The picture is a bit different right now. Due to the widening YTD, the stronger rated European oil & gas majors now trade wider than the stronger rated European utilities, despite these oil & gas companies being rated three to four notch...
- Alyssa Gammoudy
- Hendrik Wiersma
- Jeroen van den Broek
- Nadège Tillier
- Suvi Platerink Kosonen
- Timothy Rahill
- Nadège Tillier
BP/Credit disappointing and… energy transition?
European oil & gas majors report year-end 2019 results in an environment where global oil demand has dropped significantly. This is mostly due to Chinese demand slumping by 20% since the eruption of the coronavirus. Despite 4Q19 results that beat estimates, BP plc released weaker full-year 2019 results vs. 2018. Credit metrics deteriorated mildly. The company spent a total of US$8.5bn in dividends and share buybacks. Management has announced another dividend increase. Today's results are not cre...
- Alyssa Gammoudy
- Hendrik Wiersma
- Jeroen van den Broek
- Nadège Tillier
- Suvi Platerink Kosonen
- Timothy Rahill
- VRS RESEARCH TEAM
- Alyssa Gammoudy
- Hendrik Wiersma
- Jeroen van den Broek
- Nadège Tillier
- Suvi Platerink Kosonen
- Timothy Rahill
- Nadège Tillier
Oil & Gas majors/2020 probably as sluggish as 2019
Year-to-date, the iBoxx Energy EUR IG index has tightened by 30bp, largely underperforming the iBoxx EUR all sectors index which has tightened by 43bp. The Utilities sector index underperformed, with a 39bp contraction. Oil & gas majors' 9M19 financial results were weaker than a year ago and oil oversupply and price volatility are still weighing on the majors' equity and credit performance. The OPEC+ members concluded their meeting last Friday, agreeing to cut production by an additional 500Mbbl...
- Hendrik Wiersma
- Jeroen van den Broek
- Job Veenendaal
- Nadège Tillier
- Suvi Platerink Kosonen
Coffee, Croissants & Credit/RBS, de Volksbank, Telecom Italia, EDF and...
RBS (RBS) reported a dip in its risk based capital ratios driven by dividends paid out during the year. The leverage ratio instead remained more stable. Earnings development was fine, although the bank still has some work to do in terms of improving its profitability. The bank continues to build its MREL buffers with another £3-5bn to be issued this year. RBS reported a CET1 ratio of 16.2% at end-2018 down from 16.7% in 3Q18. The deduction is due to the dividends paid out over the year, as excl...
- Hendrik Wiersma
- Jeroen van den Broek
- Job Veenendaal
- Nadège Tillier
- Suvi Platerink Kosonen
Coffee, Croissants & Credit/TOTAL SA and BP Plc
According to Bloomberg, French oil & gas major TOTAL SA (TOTAL) has advisers working on an offer for Eneco Groep NV. Earlier, Royal Dutch Shell (RDSALN) and PGGM said they were studying a joint offer. In 2016, TOTAL SA acquired Lampiris SA in Belgium and Direct Energie in 2018. The French oil & gas major targets 6 million power and gas customers in France. The acquisition of Eneco would boost TOTAL SA's development in the utilities sector. The Dutch company has 2.8m clients, including 700k clien...
- Hendrik Wiersma
- Jeroen van den Broek
- Job Veenendaal
- Nadège Tillier
- Suvi Platerink Kosonen
Coffee, Croissants & Credit/BP and EPFR flows
Oil & gas major BP (BPLN) agreed to be more transparent on its actions to limit climate change. The company's communication follows the demand of the investor initiative Climate Action 100+ which comprises investor representatives of 310 investors managing some US$32 trillion in assets. Emma Herd, member of the steering committee, said that “investors will continue to work with BP to ensure that its actions are in line with the goals of the Paris Agreement.†Before BP, Royal Dutch Shell (RD...
- Hendrik Wiersma
- Jeroen van den Broek
- Job Veenendaal
- Nadège Tillier
- Suvi Platerink Kosonen
Coffee, Croissants & Credit/BPLN and ORAFP
In November 2018, BP (BPLN) finalized the US$10.5bn acquisition of BHP's US shale assets. The company adds 4.6bn barrels of oil equivalent of discovered resources in Texas and Louisiana. In November 2018, BP financed the deal with more than US$10bn of new debt withdrawn from the bond market. The oil & gas major announced that it would divest US$6bn of assets in the coming months and years and continue to expand its footprint in US shale oil and gas. According to Bloomberg, BP is considering sell...
- Hendrik Wiersma
- Jeroen van den Broek
- Job Veenendaal
- Nadège Tillier
Coffee, Croissants & Credit/BP starts operating Shah Deniz 2 gas pipel...
BP (BPLN) announced that it has started operating the Shah Deniz 2 gas pipeline. The pipeline is scheduled to transport 26 bcm/day of gas from Azerbaijan gas production fields to Turkey. BP has a 28.8% stake in the Shah Deniz consortium. The pipeline construction amounted to US$28bn. The pipeline is part of the South Gas Corridor supported by the European Union and bypassing Russia. The corridor is actually composed of several pipelines that will connect with each other in order to deliver gas f...
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