French oil giant Total today said that its 2013 net profit dipped 20% to €8.4 billion, on the back of higher exploration charges and crumbling refining margins in Europe.
Adjusted net income, a key measure which excludes some volatile or non-recurrent items, was down 12% to €10.7 billion. Total sales fell 5% to €189.5 billion, the group said.
Production was stable for last year, instead of showing the increase Total had forecast.
Chairman and chief executive Christophe de Margerie said "the significant deterioration of European refining margins was partially offset by a more favourable environment for petrochemicals".
Total's spree of capital expenditure peaked in 2013 and was to fall this year and in the years ahead.
"The intensive investment phase that we embarked on reached a peak of $28 billion dollars in 2013," Margerie said.
"The significant deterioration of European refining margins was partially offset by a more favourable environment for petrochemicals," he said.
Despite the setback for production, the group said it was holding to its target of raising output steadily to 2017 and beyond with new projects in Africa, Canada, Russia and Brazil.
Even though the annual results fell short of expectations, the group said that it intended to increase its dividend for 2013 by 1.7% to €2.38 per share from €2.34 in 2012.
Total is the biggest company by capitalisation quoted on France's CAC 40 index.