(Bloomberg) -- Eni SpA posted a record annual profit due to high oil and gas prices, despite its fourth quarter missing estimates.

The Italian energy giant followed its peers with stellar earnings for 2022, after Russia’s invasion of Ukraine sent the value of key commodities soaring. While the cost of energy has dropped in recent months, the conflict threatens a long-term upheaval that could keep prices elevated for years to come. 

Eni’s fourth-quarter adjusted net income was €2.5 billion ($2.6 billion), missing the average analyst estimate of €2.6 billion. For the full year the figure was €13.3 billion, a record.

The company’s response to the energy crisis was an “important driver” of the performance of Eni’s gas business, Chief Executive Officer Claudio Descalzi said in a statement on Thursday.

The gas business earned €2.1 billion before interest and taxes during the year as Eni replaced Russian flows with supplies from elsewhere. The performance of the gas business was the largest positive surprise, while corporate costs were also lower than expected, Gianmarco Bonacina, an analyst at Equita, said in a note. 

Eni has committed to improving Italy’s energy security by securing gas supplies from Africa to replace Russian imports over the next couple of years. The company’s oil and gas production for the year was 1.610 million barrel of oil equivalent a day, below the target of 1.7 million because of unplanned outages, the company said. 

Upstream results were disappointing, said RBC Capital Markets’ analyst Biraj Borkhataria. The company’s shares fell 1.3% to 13.93 euros as of 10:09 a.m. in Milan.

Investors are waiting for the presentation of Eni’s 2023 to 2026 business strategy later on Thursday, with the potential for additional share buybacks in focus. 

“Eni has room to raise average capital spending, and either way, we see room for cash returns upside,” Jason Kenney, an analyst at Santander CIB, said in a note. 



(Updates with shares, gas business details, analysts comments)

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