TotalEnergies SE (TTE) Cash Flow Statement

The OCF/NI ratio oscillates wildly, from 3.69 in 2025Q4 to 0.38 in 2024Q1, indicating that earnings quality is heavily influenced by timing of collections and payments rather than underlying profitability. The 2026Q1 negative working capital change of -$6.9B suggests a significant cash outflow that may reverse in subsequent quarters, warranting close monitoring of cash conversion stability.

The FCF trajectory is highly volatile, with negative quarters in 2025Q1 and 2026Q1, but strong rebounds in adjacent quarters, indicating that capital expenditure discipline is maintained while cash generation is at the mercy of price cycles. The average FCF margin over the period is roughly 7%, which is below the peer average of 8.2%, suggesting TTE may be less efficient at converting revenue into free cash flow than some competitors.

The consistency of capex suggests management is maintaining investment levels across the cycle, likely to support both hydrocarbon and renewable projects. The slight uptick in capex intensity in 2025Q2 (10.7%) may indicate increased spending on growth initiatives, but the overall stability suggests a balanced approach between maintenance and expansion.

The large positive working capital changes in 2024Q4 and 2025Q4 suggest strong cash collections or inventory drawdowns, while the negative changes in 2025Q1 and 2026Q1 indicate cash outflows for inventory builds or receivable increases. This pattern aligns with commodity price movements, where rising prices lead to higher working capital requirements, and falling prices release cash.

The company consistently returns capital to shareholders, with dividends stable around $2B per quarter and buybacks varying between $0.8B and $2.3B. In quarters with negative FCF, the payout exceeds cash generation, implying reliance on balance sheet reserves or debt, which may be sustainable given the low leverage but warrants monitoring if commodity prices remain weak.

The persistent OCF/NI ratio above 1.0 in most quarters suggests that non-cash charges like depreciation and amortization are significant, and working capital is a net source of cash over time. This divergence may indicate conservative accounting or efficient management of working capital, but investors should note that the gap could narrow if commodity prices decline and inventory effects reverse.