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Chevron (CVX) Misses on Q1 Earnings Despite Strong Prices
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Chevron Corporation (CVX - Free Report) reported adjusted first-quarter earnings per share of $3.36, missing the Zacks Consensus Estimate of $3.44 on weaker-than-expected performance from the downstream segment. Precisely, income from the unit totaled $331 million, below the Zacks Consensus Estimate of $569 million.
However, the energy major’s bottom line compared favorably with the year-earlier quarter's earnings of 90 cents on the back of sharply higher commodity prices.
The company generated revenue of $54.4 billion. The sales figure beat the Zacks Consensus Estimate of $47 billion and increased 69.8% year over year.
Chevron Corporation Price, Consensus and EPS Surprise
Upstream: Chevron’s production of crude oil and natural gas decreased 2% from the year-earlier level to 3,060 MBOE/d (57% liquids) but it was the sixth successive quarter where volumes topped 3 million barrels per day.
The year-over-year decline reflects normal field declines, entitlement effects and end of the Rokan concession in Indonesia, which were partly offset by strength in the Permian Basin, absence of weather-related impacts no production curtailments.
The U.S. output was up 10.1% year over year to 1,184 MBOE/d, though the company’s international operations (accounting for 61% of the total) fell 8.3% to 1,876 MBOE/d.
Despite being pulled down by the dip in volumes, Chevron’s upstream segment recorded a profit of $6.9 billion in the first quarter of 2022, rocketing from the $2.4 billion earned in the year-ago period and also beating the Zacks Consensus Estimate of $6.5 billion.
This was primarily on account of a significant improvement in commodity prices. At $77 per barrel, Chevron’s average realized liquids prices in the U.S. were 60.4% above the year-earlier levels while prices overseas jumped 66.1%. On the natural gas front, its realizations soared 90.7% and 87.9%.
Downstream: Chevron’s downstream segment recorded a profit of $331 million, rocketing from last year’s figure of just $5 million. The improvement underlined higher domestic product sales margins and improved earnings from its Chevron Phillips Chemical Company joint venture.
Cash Flows, Capital Expenditure
The company recorded $8.1 billion in cash flow from operations, compared to $4.2 billion a year ago. The soaring cash flow could be attributed to strong price realizations in the upstream business. Importantly, Chevron’s free cash flow for the quarter was $6.1 billion.
Further, Chevron paid $2.7 billion in dividends and bought back $1.3 billion worth of its shares.
The Zacks Rank #2 (Buy) company spent $2.8 billion in capital and exploratory expenditures during the quarter, compared to the year-ago period’s $2.5 billion. Some 88% of the total outlays pertained to upstream projects.
As of Mar 31, the San Ramon, CA-based company had $11.7 billion in cash and cash equivalents and total debt of $29.3 billion with a debt-to-total capitalization of about 16.7%.
Some Key Energy Earnings So Far
Chevron might have missed profit estimates but supportive industry fundamentals and the emerging multi-year commodity price upcycle have led to a good earnings season for certain energy companies so far.
Schlumberger (SLB - Free Report) , the largest oilfield contractor, announced first-quarter earnings of 34 cents per share (excluding charges and credits), which beat the Zacks Consensus Estimate of 32 cents. SLB recorded total revenues of $6 billion, outpacing the Zacks Consensus Estimate by 1.2%.
Schlumberger’s strong quarterly earnings resulted from strong drilling activities in North America, Latin America and the Middle East. Higher evaluation and intervention activities across the international offshore markets also buoyed the company’s first-quarter results. In more good news for investors, SLB raised its quarterly dividend by 40% to 17.5 cents per share (or 70 cents per share annualized).
Refining giant Valero Energy (VLO - Free Report) reported adjusted earnings of $2.31 per share, improving from a loss of $1.73 in the year-ago quarter. The bottom line also beat the Zacks Consensus Estimate of $1.61 per share. VLO’s strong quarterly results have been driven by increased refinery throughput volumes and a higher refining margin.
Valero generated total quarterly revenues of $38,542 million, which increased from $20,806 million in the prior-year quarter. The top line also surpassed the Zacks Consensus Estimate of $32,055 million. For the quarter, Valero’s refining throughput volumes were 2,800 thousand barrels per day (MBbls/d), up from 2,410 MBbls/d in first-quarter 2021.
Natural gas producer Range Resources (RRC - Free Report) reported adjusted earnings of $1.18 per share, beating the Zacks Consensus Estimate of $1.15 per share. The bottom line significantly improved from the prior-year quarter’s earnings of 30 cents per share. RRC’s The strong quarterly earnings can be attributed to higher realizations of commodity prices.
Range Resources’ total price realization (excluding derivative settlements and before third-party transportation costs) averaged $5.54 per thousand cubic feet equivalent, up 72% year over year. In particular, natural gas prices rose 86% on a year-over-year basis to $4.80 per thousand cubic feet.
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Chevron (CVX) Misses on Q1 Earnings Despite Strong Prices
Chevron Corporation (CVX - Free Report) reported adjusted first-quarter earnings per share of $3.36, missing the Zacks Consensus Estimate of $3.44 on weaker-than-expected performance from the downstream segment. Precisely, income from the unit totaled $331 million, below the Zacks Consensus Estimate of $569 million.
However, the energy major’s bottom line compared favorably with the year-earlier quarter's earnings of 90 cents on the back of sharply higher commodity prices.
The company generated revenue of $54.4 billion. The sales figure beat the Zacks Consensus Estimate of $47 billion and increased 69.8% year over year.
Chevron Corporation Price, Consensus and EPS Surprise
Chevron Corporation price-consensus-eps-surprise-chart | Chevron Corporation Quote
Segment Performance
Upstream: Chevron’s production of crude oil and natural gas decreased 2% from the year-earlier level to 3,060 MBOE/d (57% liquids) but it was the sixth successive quarter where volumes topped 3 million barrels per day.
The year-over-year decline reflects normal field declines, entitlement effects and end of the Rokan concession in Indonesia, which were partly offset by strength in the Permian Basin, absence of weather-related impacts no production curtailments.
The U.S. output was up 10.1% year over year to 1,184 MBOE/d, though the company’s international operations (accounting for 61% of the total) fell 8.3% to 1,876 MBOE/d.
Despite being pulled down by the dip in volumes, Chevron’s upstream segment recorded a profit of $6.9 billion in the first quarter of 2022, rocketing from the $2.4 billion earned in the year-ago period and also beating the Zacks Consensus Estimate of $6.5 billion.
This was primarily on account of a significant improvement in commodity prices. At $77 per barrel, Chevron’s average realized liquids prices in the U.S. were 60.4% above the year-earlier levels while prices overseas jumped 66.1%. On the natural gas front, its realizations soared 90.7% and 87.9%.
Downstream: Chevron’s downstream segment recorded a profit of $331 million, rocketing from last year’s figure of just $5 million. The improvement underlined higher domestic product sales margins and improved earnings from its Chevron Phillips Chemical Company joint venture.
Cash Flows, Capital Expenditure
The company recorded $8.1 billion in cash flow from operations, compared to $4.2 billion a year ago. The soaring cash flow could be attributed to strong price realizations in the upstream business. Importantly, Chevron’s free cash flow for the quarter was $6.1 billion.
Further, Chevron paid $2.7 billion in dividends and bought back $1.3 billion worth of its shares.
The Zacks Rank #2 (Buy) company spent $2.8 billion in capital and exploratory expenditures during the quarter, compared to the year-ago period’s $2.5 billion. Some 88% of the total outlays pertained to upstream projects.
You can see the complete list of today’s Zacks #1 Rank stocks here.
Balance Sheet
As of Mar 31, the San Ramon, CA-based company had $11.7 billion in cash and cash equivalents and total debt of $29.3 billion with a debt-to-total capitalization of about 16.7%.
Some Key Energy Earnings So Far
Chevron might have missed profit estimates but supportive industry fundamentals and the emerging multi-year commodity price upcycle have led to a good earnings season for certain energy companies so far.
Schlumberger (SLB - Free Report) , the largest oilfield contractor, announced first-quarter earnings of 34 cents per share (excluding charges and credits), which beat the Zacks Consensus Estimate of 32 cents. SLB recorded total revenues of $6 billion, outpacing the Zacks Consensus Estimate by 1.2%.
Schlumberger’s strong quarterly earnings resulted from strong drilling activities in North America, Latin America and the Middle East. Higher evaluation and intervention activities across the international offshore markets also buoyed the company’s first-quarter results. In more good news for investors, SLB raised its quarterly dividend by 40% to 17.5 cents per share (or 70 cents per share annualized).
Refining giant Valero Energy (VLO - Free Report) reported adjusted earnings of $2.31 per share, improving from a loss of $1.73 in the year-ago quarter. The bottom line also beat the Zacks Consensus Estimate of $1.61 per share. VLO’s strong quarterly results have been driven by increased refinery throughput volumes and a higher refining margin.
Valero generated total quarterly revenues of $38,542 million, which increased from $20,806 million in the prior-year quarter. The top line also surpassed the Zacks Consensus Estimate of $32,055 million. For the quarter, Valero’s refining throughput volumes were 2,800 thousand barrels per day (MBbls/d), up from 2,410 MBbls/d in first-quarter 2021.
Natural gas producer Range Resources (RRC - Free Report) reported adjusted earnings of $1.18 per share, beating the Zacks Consensus Estimate of $1.15 per share. The bottom line significantly improved from the prior-year quarter’s earnings of 30 cents per share. RRC’s The strong quarterly earnings can be attributed to higher realizations of commodity prices.
Range Resources’ total price realization (excluding derivative settlements and before third-party transportation costs) averaged $5.54 per thousand cubic feet equivalent, up 72% year over year. In particular, natural gas prices rose 86% on a year-over-year basis to $4.80 per thousand cubic feet.