BlackRock Quietly Builds an OMV Stake as a €886 Million Book Gain Masks a Deeper Slump

BlackRock raises OMV stake to 4.39% as Q1 net profit of €1.645B masks weak operations, with adjusted earnings down 22% and a dividend cut ahead.

The world’s largest asset manager has been quietly increasing its exposure to OMV. BlackRock now holds 4.39 percent of the voting rights in the Austrian energy group, a position built just as the company delivers a set of first-quarter results that tell two very different stories.

On the surface, the numbers look robust. OMV reported a net profit of €1.645 billion for the first three months of 2026. But strip out the one-off effects, and a far more sobering picture emerges. The bulk of that headline figure — €886 million — came from a book gain tied to the deconsolidation of the Borealis Group following the creation of the Borouge International joint venture. Without that accounting boost, the underlying performance was decidedly weaker.

Adjusted operating profit fell 12 percent to €1.025 billion, while adjusted net income dropped 22 percent to €323 million. Earnings per share came in at €0.99, barely half the €1.89 analysts had penciled in. The miss was sharp enough to trigger a downgrade from RBC Capital Markets, which cut its rating to “Underperform” and lowered its price target to €46, citing pressure across chemicals, European gas, and refining operations. Barclays took a more constructive view, nudging its target up to €53, while the Erste Group highlighted an operating cash flow of €1.6 billion as a bright spot.

The root cause of the operational weakness lies in the Middle East. The closure of the Strait of Hormuz in late February slashed OMV’s hydrocarbon production by 7 percent to 288,000 barrels of oil equivalent per day. On top of that, the fuels division absorbed roughly €100 million in one-off hedging losses.

Despite the earnings disappointment, the stock has been on a tear. OMV shares now trade at €60.80, a gain of around 25 percent since the start of the year. That rally has pushed the relative strength index to 73.8, a level that typically signals overbought conditions.

The Borouge International joint venture — a 50:50 partnership with Abu Dhabi’s XRG that combines Borealis, NOVA Chemicals, and XRG’s existing Borouge assets — is central to management’s long-term narrative. OMV bills the entity as the world’s fourth-largest polyolefin producer, with a target to lift pro-forma average EBITDA from $4.5 billion to more than $7 billion, underpinned by over €500 million in synergies by 2030. But the immediate financial impact is less generous than expected. OMV will receive only $250 million from the joint venture this year, half the sum originally anticipated. That shortfall is expected to translate into a dividend cut of €0.60 to €0.70 per share.

The company is also overhauling its distribution policy. From 2026 onward, dividends will be structurally decoupled from oil prices, with the first payout under the new framework scheduled for 2027. For now, shareholders are being asked to accept a leaner interim payout.

The balance sheet has taken a hit from the transaction as well. Net debt rose to €4.5 billion from €3.6 billion at the end of 2025. Management has adjusted its full-year guidance accordingly, raising the Brent assumption to a range of $85 to $95 per barrel and forecasting daily production of between 280,000 and 290,000 barrels, contingent on the situation in the Strait of Hormuz.

A leadership transition is also on the horizon. On September 1, Emma Delaney, a former BP executive, will take over as chief executive, becoming the first woman to lead OMV. Analysts expect her to steer the company toward a greater emphasis on gas production. The medium-term outlook hinges on the Neptun Deep project in the Black Sea, where offshore installation work is on track to finish by the end of 2026, with first gas targeted for 2027. That milestone will test whether the logic of the Borouge joint venture holds up under new management.