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Equinor (EQNR) Shares Rise 5.3% Since Q1 Earnings Top Estimates
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Equinor ASA (EQNR - Free Report) shares gained 5.3% after reporting better-than-expected first-quarter 2023 earnings on May 4. The upward price movement can be attributed to the company’s satisfactory quarterly upstream production and increased production expectation for 2023.
Q1 Results
Equinor reported first-quarter 2023 adjusted earnings per share of $1.13, beating the Zacks Consensus Estimate of $1.08. However, the bottom line declined from the year-ago quarter’s earnings of $1.60 per share.
Total quarterly revenues declined to $29,224 million from $36,393 million in the prior-year quarter. The top line beat the Zacks Consensus Estimate of $24,727 million.
Better-than-expected quarterly earnings were aided by higher daily production of liquids and gas. The positives were partially offset by lower liquids and gas prices, and higher operations and maintenance expenses.
Exploration & Production Norway (E&P Norway): The segment reported adjusted earnings of $9,916 million, declining from $16,256 million in the year-ago quarter. Lower liquids and gas prices affected the segment.
The company’s average daily production of liquids and gas increased 0.8% year over year to 1,448 thousand barrels of oil equivalent per day (MBoe/d) due to the ramp-up of new fields.
E&P International: The segment’s adjusted operating profit was $614 million, down from the year-ago quarter’s $1,078 million. Higher operations and maintenance expenses affected the segment.
The average daily equity production of liquids and gas declined to 336 MBoe/d from 341 MBoe/d in the year-ago quarter. The segment was primarily affected by Equinor’s exit from Russia, the natural decline in several mature fields and the effect of turnarounds.
E&P USA: Through the segment, Equinor generated an adjusted quarterly profit of $340 million, down from $713 million in the March-end quarter of 2022. The segment was affected by a natural decline in the Appalachian basin and several mature fields in the Gulf of Mexico.
The integrated firm’s average equity production of liquids and gas was 347 MBoe/d, up from 329 MBoe/d in the year-ago quarter.
Marketing, Midstream & Processing: The segment reported adjusted earnings of $1,278 million, turning around from a loss of $92 million reported a year ago.
Renewables: The segment reported an adjusted loss of $83 million, wider than a loss of $10 million reported in the year-ago quarter. Higher business development costs, resulting from increased activity levels in the United States, the U.K. and Asia, primarily hurt the segment.
Free Cash Flow
In the March-end quarter, Equinor generated a free cash flow of $4,201 million, down from $12,689 million in the year-ago period. The underperformance resulted from declining operating cash flows.
Balance Sheet
As of Mar 31, 2023, Equinor reported $17,915 million in cash and cash equivalents. The company’s long-term debt was $24,862 million at the first-quarter end.
2023 Outlook
Equinor kept its production growth expectations at 3% for 2023. The company reiterated its organic capital spending budget of $10-11 billion for the year.
For the 2024-2026 period, the oil major expects average organic capital spending of $13 billion per annum.
Earnings Snapshots of Other Integrated Energy Companies
Exxon Mobil Corporation's (XOM - Free Report) first-quarter 2023 earnings per share of $2.83 (excluding identified items) beat the Zacks Consensus Estimate of $2.65.
At the end of first-quarter 2023, ExxonMobil’s total cash and cash equivalents were $32,651 million, and long-term debt amounted to $39,150 million. The firm has significantly lower debt exposure than other integrated majors. Also, ExxonMobil announced the expansion of its share repurchase program up to $50 billion through 2024.
TotalEnergies SE (TTE - Free Report) reported first-quarter 2023 operating earnings of $2.61 (€2.43) per share, beating the Zacks Consensus Estimate of $2.43 per share.
TotalEnergies expects to invest $16 billion in 2023, of which $5 billion will be allocated to further strengthening renewable operations and electricity. TTE aims to repurchase stocks worth $2 billion in the second quarter, which will further boost shareholders’ value.
Chevron Corporation (CVX - Free Report) reported adjusted first-quarter 2023 earnings per share of $3.55, surpassing the Zacks Consensus Estimate of $3.36.
As of Dec 31, the San Ramon, CA-based company had $15.7 billion in cash and cash equivalents, and a total debt of $23.2 billion, with a debt-to-total capitalization of 12.7%. Compared with composite stocks belonging to the industry, Chevron has significantly lower exposure to debt capital.
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Equinor (EQNR) Shares Rise 5.3% Since Q1 Earnings Top Estimates
Equinor ASA (EQNR - Free Report) shares gained 5.3% after reporting better-than-expected first-quarter 2023 earnings on May 4. The upward price movement can be attributed to the company’s satisfactory quarterly upstream production and increased production expectation for 2023.
Q1 Results
Equinor reported first-quarter 2023 adjusted earnings per share of $1.13, beating the Zacks Consensus Estimate of $1.08. However, the bottom line declined from the year-ago quarter’s earnings of $1.60 per share.
Total quarterly revenues declined to $29,224 million from $36,393 million in the prior-year quarter. The top line beat the Zacks Consensus Estimate of $24,727 million.
Better-than-expected quarterly earnings were aided by higher daily production of liquids and gas. The positives were partially offset by lower liquids and gas prices, and higher operations and maintenance expenses.
Equinor ASA Price, Consensus and EPS Surprise
Equinor ASA price-consensus-eps-surprise-chart | Equinor ASA Quote
Segmental Analysis
Exploration & Production Norway (E&P Norway): The segment reported adjusted earnings of $9,916 million, declining from $16,256 million in the year-ago quarter. Lower liquids and gas prices affected the segment.
The company’s average daily production of liquids and gas increased 0.8% year over year to 1,448 thousand barrels of oil equivalent per day (MBoe/d) due to the ramp-up of new fields.
E&P International: The segment’s adjusted operating profit was $614 million, down from the year-ago quarter’s $1,078 million. Higher operations and maintenance expenses affected the segment.
The average daily equity production of liquids and gas declined to 336 MBoe/d from 341 MBoe/d in the year-ago quarter. The segment was primarily affected by Equinor’s exit from Russia, the natural decline in several mature fields and the effect of turnarounds.
E&P USA: Through the segment, Equinor generated an adjusted quarterly profit of $340 million, down from $713 million in the March-end quarter of 2022. The segment was affected by a natural decline in the Appalachian basin and several mature fields in the Gulf of Mexico.
The integrated firm’s average equity production of liquids and gas was 347 MBoe/d, up from 329 MBoe/d in the year-ago quarter.
Marketing, Midstream & Processing: The segment reported adjusted earnings of $1,278 million, turning around from a loss of $92 million reported a year ago.
Renewables: The segment reported an adjusted loss of $83 million, wider than a loss of $10 million reported in the year-ago quarter. Higher business development costs, resulting from increased activity levels in the United States, the U.K. and Asia, primarily hurt the segment.
Free Cash Flow
In the March-end quarter, Equinor generated a free cash flow of $4,201 million, down from $12,689 million in the year-ago period. The underperformance resulted from declining operating cash flows.
Balance Sheet
As of Mar 31, 2023, Equinor reported $17,915 million in cash and cash equivalents. The company’s long-term debt was $24,862 million at the first-quarter end.
2023 Outlook
Equinor kept its production growth expectations at 3% for 2023. The company reiterated its organic capital spending budget of $10-11 billion for the year.
For the 2024-2026 period, the oil major expects average organic capital spending of $13 billion per annum.
The Zacks Rank #3 (Hold) company expects scheduled maintenance activity to reduce equity production by around 45 MBoe/d for 2023. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Earnings Snapshots of Other Integrated Energy Companies
Exxon Mobil Corporation's (XOM - Free Report) first-quarter 2023 earnings per share of $2.83 (excluding identified items) beat the Zacks Consensus Estimate of $2.65.
At the end of first-quarter 2023, ExxonMobil’s total cash and cash equivalents were $32,651 million, and long-term debt amounted to $39,150 million. The firm has significantly lower debt exposure than other integrated majors. Also, ExxonMobil announced the expansion of its share repurchase program up to $50 billion through 2024.
TotalEnergies SE (TTE - Free Report) reported first-quarter 2023 operating earnings of $2.61 (€2.43) per share, beating the Zacks Consensus Estimate of $2.43 per share.
TotalEnergies expects to invest $16 billion in 2023, of which $5 billion will be allocated to further strengthening renewable operations and electricity. TTE aims to repurchase stocks worth $2 billion in the second quarter, which will further boost shareholders’ value.
Chevron Corporation (CVX - Free Report) reported adjusted first-quarter 2023 earnings per share of $3.55, surpassing the Zacks Consensus Estimate of $3.36.
As of Dec 31, the San Ramon, CA-based company had $15.7 billion in cash and cash equivalents, and a total debt of $23.2 billion, with a debt-to-total capitalization of 12.7%. Compared with composite stocks belonging to the industry, Chevron has significantly lower exposure to debt capital.