* Clean CCS EBIT up 6 pct to 851 mln eur vs poll avg 835 mln
* Cash flow up 9 pct to 1.4 bln eur
* Shares up 1.4 percent after reaching 4-1/2-year high
(Recasts, adds CFO comments on Black Sea investment; shares)
By Georgina Prodhan
VIENNA, May 14 Austrian energy group OMV
reported higher-than-expected profit and cash flow for
the first quarter after downstream activities reversed a
year-ago loss, and said this would help it pursue its ambitious
OMV is switching focus from refining and selling oil and gas
to higher-risk but higher-reward exploration and production, and
plans a hike in investments this year. It is exploring what may
be its biggest ever gas find, in the Black Sea.
OMV reported underlying profit rose 6 percent to 851 million
euros, better than the average in a Reuters poll, and free cash
flow rose 9 percent.
"The group has very exciting possibilities in the Black Sea
which are also going to consume capital," said Chief Financial
Officer David Davis, playing down analysts' hopes for a dividend
"We prefer to see what's available before we distribute it,"
Davis told journalists on a webcast.
He confirmed OMV's long-term target to pay out 30 percent of
earnings, after a 29 percent payout last year.
OMV's shares rose almost 4 percent in early trading on
Tuesday to a 4-1/2-year high, the leading gainers in a flat
European oil and gas index.
OMV, whose core countries are Austria and Romania and which
also operates in the North Sea, North Africa, the Middle East,
Australia and New Zealand, is raising its capital expenditure to
2.8 billion euros ($3.6 billion) this year from 2.4 billion.
It said preliminary results from its Black Sea Neptun block,
which may be its biggest gas find ever, showed potential
production of 630 million cubic feet per day.
The joint venture between OMV's Romanian subsidiary Petrom
and ExxonMobil includes the first deep-water
exploration well in Romanian waters.
OMV's exploration expenses fell in the first quarter to 115
million euros from 130 million a year earlier after it wrote off
unsuccessful wells in Norway and Britain, and production costs
also fell by 2 percent on cost savings and higher volumes.
Cash flow from operating activities rose to 1.40 billion
euros as OMV cut its working capital by 500 million euros.
Clean net profit fell by 8 percent to 349 million euros,
missing analysts' expectations of 380 million.
($1 = 0.7703 euros)
(Reporting by Georgina Prodhan; Editing by Sophie Walker)