European Morning Credit: Today in European Credit

Research evidence excerpt

European Morning Credit: Today in European Credit

Corporates

Repsol (REPSM): 2Q26 beat on BBG consensus

Adj. EBITDA CCS increased to €3.2bn vs €1.4bn in 2Q’25, and adj. net income increased

to €1.8bn from €0.6bn in 2Q’25 – both a beat on BBG consensus estimates. The positive

result was mainly driven by strong result of the Industrial segment (Refining, Chemicals).

Refining business benefited from higher refining margin due to higher middle distillate

and gasoline spreads as well as wider heavy-to-light crude oil spreads as well as positive

price lag effect in kerosene. Chemicals business benefited from higher chemical margin

indicator and higher volumes. Performance of Upstream and Customer segments was

good with a smaller positive jump in adj. net income.

Free cash flow came in at €1bn vs €0.4bn in 2Q’25 mainly reflecting the strong

operating performance in 2Q’26. Net debt (including leases) declined to €3.7bn from

€4.8bn as of 1Q’26. Gearing (%, including leases) declined to 11.3% from 14.3% as of

1Q’26.

Outlook: Repsol expects FY26 production between 560-570kboe/d.

Share buyback: Repsol approved up to €850mn of buybacks and plans another

programme in October to meet its shareholder distribution target range - 30–40% of

cash flow from operations.

(Prithvi Vetsa)

TotalEnergies (TTEFP): 2Q26 adj. net income in line with

Bloomberg consensus

Adj. EBITDA ($13.2bn, +36% y/y) is a miss on Bloomberg (BBG) estimates, while adj. net

income ($6bn vs $3.6bn in 2Q25) is in-line with BBG consensus estimates. Cash flow

from operations excluding working capital was $9.8bn vs $6.6bn in 2Q25. Net debt

decreased to $19.7bn from $23bn as of 1Q26, mainly reflecting the positive free cash

flow generation and working capital benefit (+1.7bn) in the quarter. Gearing (%) declined