Italian energy group Eni said it would pay a €1.3 billion special dividend and increase its share buyback programme after its third-quarter net profit more than doubled from a year ago, propelling its shares to a near 20-year high.
The state-controlled company's adjusted net profit for the July-September period was €2.8 billion, above a company-compiled analyst consensus of €2.5 billion and sharply up from €1.3 billion a year earlier.
Eni also raised its guidance for underlying cash flow from operations to €16.5 billion from €15 billion.
"We are further raising the distribution by an extraordinary dividend of €0.46 per share to be paid in the fourth quarter and increasing again the buyback to €3.8 bln, underscoring our continued commitment to sharing upside with shareholders," CEO Claudio Descalzi said in a statement.
Shares in the group rose four per cent by 08:58 GMT to €27.15, just shy of a session peak which set a high since 2007 and bucking a negative Milan blue-chip index, according to LSEG data.
"Eni reported a strong set of results...driven by stronger results in the refining segment versus consensus and our expectations, as well as a lower effective tax rate," RBC analyst Biraj Borkhataria said in a report.
Eni rivals including BP and TotalEnergies are also expected to post a big jump in third-quarter profit, with refining and trading earnings boosted by the US-Israeli war on Iran which has pushed energy prices to multi-year highs.
Investors are focused on how firms will use the extra cash.
The Italian group continued to show higher-than-expected growth in production. Eni has discovered 1.23 billion barrels of new hydrocarbon resources so far this year, well above its target.
Underlying hydrocarbon production rose seven per cent year-on-year to 1.83 million barrel of oil equivalent per day (boe/d) in the third quarter.
This was driven by project ramp-ups in West-Africa, Mexico and Norway and a contribution from Searah, a joint venture launched with Malaysia's Petronas.
Eni now expects production to increase by between six per cent and seven per cent this year as it advances with upstream projects in southeast Asia, Latin America and Africa, it said.
The refining business posted a €730 million pro-forma operating profit, up sharply year-on-year thanks to improved plant utilisation rates despite higher shipping costs, Eni said.
As for the "low-carbon" businesses, Eni's biofuel unit Enilive reported an 80 per cent year-on-year increase in its pro-forma adjusted operating profit.
(Reporting by Francesca Landini, additional reporting Mirko Miorelli editing by Giulia Segreti, Gavin Jones and Valentina Za)