TotalEnergies's Strategy After Russia, Shareholder Returns to Come Into Focus at Investor Day -- Preview

By Giulia Petroni

TotalEnergies SE is hosting an investor day on Wednesday. Here's what to watch:

STRATEGY AND RUSSIA: Management is expected to provide an updated strategy plan for a possible future without Russia in the picture, but uncertainties linger as the French major stopped short of announcing a full exit. "We don't expect TTE to change its stance... and remain wary around the potential for asset expropriation, and the impact it could have on TTE's LNG portfolio," RBC Capital Markets' Biraj Borkhataria says. Meanwhile, analysts at Credit Suisse say that by not committing to new capital to the country, the company may have lost some flexibility on the delivery of long-term objectives.

SHAREHOLDERS REMUNERATION: TotalEnergies may look at rebasing its dividend to U.S. dollars rather than euros to better align its payout with its functional currency, according to analysts. "Given the company's financial framework is USD-based, we think this makes sense and could imply a 10%-15% increase to get the overall dividend back to around $8 billion per annum," says RBC's Borkhataria.

CAPITAL EXPENDITURE: CS analysts foresee the oil-and-gas company keeping this year's capex guide at the top of the $13 billion-$16 billion range in order to address the energy crisis with short-cycle projects and accelerate the transition away from fossil fuels. Guidance on capex could be pressured by inflation across the hydrocarbon and low carbon value chains, according to RBC.

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(END) Dow Jones Newswires

September 27, 2022 10:27 ET (14:27 GMT)

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