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Eni Quarterly Net Falls 28% as Output Slips, Taxes Up

Italian oil and gas company Eni posted a 27.8 percent drop in third-quarter adjusted net profit on Wednesday, towards the low end of analysts' forecasts, as production slipped and taxes rose.

Eni, Europe's third-biggest energy company by market value, had adjusted net profit of 1.89 billion euros ($2.72 billion).

The figure excludes inventory gains and special charges.

Its adjusted operating profit was 4.245 billion euros, down 17.2 percent from 2006, the company said in a statement.

A Reuters poll of 12 analysts had forecast adjusted net profit of 1.938 billion euros on average. The range was 1.826 billion euros to 2.272 billion euros.

Oil and gas output was 1.66 million barrels of oil equivalent per day, down 2.9 percent from the same period last year.

Production was hampered by the euro's appreciation against the dollar, lower sold volumes and rising costs, Eni said. The group's adjusted tax rate rose to 53 percent from 48.8 percent.

Eni confirmed its forecast for 2007 production in line with that of 2006. The forecast assumes a Brent price of $55 a barrel as laid out in Eni's four-year strategic plan.

Third-quarter gas sales were up 4.4 percent to 19.74 billion cubic meters. Eni reaffirmed its forecast for light year-on-year sales growth.

Eni has a dividend yield of 4.96 percent, the highest among European oil majors, according to Reuters Estimates. Its estimated price/earnings ratio is 9.88, the lowest in the sector.