Repsol

Company Update:
Production reached 558 kboe/d (+3.5% QoQ, broadly stable YoY), roughly in line with consensus (-0.7%), helped by a much stronger Brent ($103.8/bbl, +52.9% YoY) on the back of the Hormuz-related shock.

EBITDA reached €3,216m, ~+11.2% ahead of consensus and Adjusted net income jumped to €1,838m, +13.4% above consensus (€1,621m) and up sharply from €873m in Q1.

EPS around €1.6 vs €1.5 expected (+9%). The beat is almost entirely a mix effect: Industrial adjusted net income jumped to €1,243m from just €103m a year ago (helped by a weak comp from last year's Iberian blackout), on the back of a Spanish refining margin that nearly tripled YoY (+137%) to a near-record $14.0/bbl. Upstream stayed broadly flat, consistent with the softer topline.

The balance sheet kept improving, with net debt down to €3.67bn (-€1.1bn QoQ) and gearing falling to 11.3% from 14.3% in Q1, aided by the Masdar renewables disposal.

Shareholder returns were the clear upside surprise. Repsol raised its second 2026 buyback from €350m to €500m but the dividend trajectory (€1.051/share for 2026, +7.8%).

We'd expect a good market reaction here, with the EPS beat, the upsized buyback, and the supportive Brent backdrop.

Expert Opinion:
At this stage, the long integrated oil call seems to make sense as we see no improvement in the Gulf situation. We still like Shell and Total more than the rest but this is mostly a sector play. Note that Total results for Q2 just came in and  look a bit weak at first glance with a miss in all divisions (notably in LNG which is disapointing) . No additional buy back bvut a slight rise in dividend (+6%).  


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