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TotalFinaElf sees savings
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March 29, 2000: 7:24 a.m. ET
Newly merged French oil producer predicts profit will double over 4 years
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LONDON (CNNfn) - TotalFinaElf on Wednesday reported a 23-percent jump in pro forma profit in 1999, as the newly formed French oil company unveiled increased estimates of cost savings and pledged to double its earnings over the next four years.
On a pro forma basis, which takes into account how a combined Total Fina and Elf would have fared, the enlarged company reported net income last year rose to  3.3 billion ($3.2 billion), or 4.77 per share, from 2.7 billion, or 3.86 a share, in the previous year. Sales rose 21 percent to 75 billion.
In a series of keenly awaited forecasts, TotalFinaElf projected annual cost savings from the Elf merger of 1.75 billion ($1.7 billion) by 2003 -- up from an  initial estimate of 1.5 billion -- and confirmed its prior merger with Belgian oil company PetroFina would provide annual synergies of 600 million.
TotalFinaElf also raised its target for capital gains from asset sales by 2003 to 8 billion from 6 billion, announced a higher-than-expected 1999 net dividend of 2.35 a share, and said it would use spare cash to reduce debt and buy back shares.
Shares in TotalFinaElf, France's second-largest company by market capitalization, rallied 2.9 percent to 147.2 euros.
"It's all a step in the right direction," said Irene Himona, an analyst with ABN Amro. "Looking at the numbers, it's positive, and I think there should be room for further upgrades (in synergy estimates) in the future."
Analysts had expected TotalFinaElf to raise its estimates of cost savings. However, the new figures were still below predictions given by Elf last year when it launched an ultimately unsuccessful bid to buy TotalFina, countering TotalFina's hostile takeover approach.
TotalFinaElf said it expected operating income to rise 70 percent by 2003. 
-- from staff and wire reports
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