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Hess (HES) Tops on Q2 Earnings, Raises '23 Production Outlook
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Hess Corporation (HES - Free Report) has reported second-quarter 2023 earnings per share of 65 cents, beating the Zacks Consensus Estimate of 57 cents. However, the bottom line significantly declined from the year-ago quarter’s $2.15 per share.
Total quarterly revenues dipped to $2,320 million from $2,988 million a year ago. The top line also missed the Zacks Consensus Estimate of $2,408 million.
Better-than-expected quarterly earnings were driven by higher oil-equivalent production volumes. The positives were partially offset by lower realizations of commodity prices.
Hess Corporation Price, Consensus and EPS Surprise
For the quarter under review, the Exploration and Production business has reported adjusted earnings of $237 million, declining from $723 million a year ago. The business was negatively impacted by a dip in realized commodity prices.
Quarterly hydrocarbon production was 387 thousand barrels of oil equivalent per day (MBoe/d), up from 322 MBoe/d in the year-ago period primarily due to higher production in Guyana and the Bakken.
Crude oil production increased from 176 thousand barrels per day (MBbls/d) in second-quarter 2022 to 216 MBbls/d in the quarter under review. Natural gas liquid production totaled 69 MBbls/d, up from 49 MBbls/d in the prior-year quarter. Also, natural gas production was 610 thousand cubic feet per day (Mcf/d), up from 580 Mcf/d a year ago.
Worldwide crude oil realization per barrel of $73.74 (excluding the impacts of hedging) significantly declined from $109.51 in the year-ago period. Also, worldwide natural gas prices fell to $3.82 per Mcf from the year-ago figure of $6.45. The average worldwide natural gas liquids’ selling price declined to $17.95 per barrel from $40.92 a year ago.
Midstream:
From the midstream business, the company generated adjusted net earnings of $62 million, down from $65 million a year ago.
Operating Expenses
Operating expenses for the second quarter totaled $454 million versus the year-ago level of $356 million. Exploration expenses increased to $99 million from $33 million in the year-ago period. However, marketing costs declined to $547 million from $843 million a year ago.
Total costs and expenses increased to $1,955 million for the quarter from $1,906 million a year ago.
Financials
Net cash provided by operating activities was $974 million for the second quarter. Hess’ capital expenditure for exploration and production activities totaled $933 million.
As of Jun 30, 2023, the company had $2,226 million in cash and cash equivalents. Its long-term debt was $8,459 million at the second-quarter end.
Guidance
For 2023, Hess expects net production guidance (excluding Libya) of 385,000-390,000 barrels of oil equivalent per day (Boe/d), an increase from the previously mentioned 365,000-375,000 Boe/d. The metric suggests a rise from the 344,000 Boe/d reported in 2022.
The upgraded guidance is mainly due to the company’s strong operating performance and the expected start-up of the Payara development project at the beginning of the fourth quarter.
One of the leading suppliers of integrated technology solutions, Oceaneering boasts an impressive portfolio of diversified products and services. OII has a Zacks Style Score of B for Growth and Momentum.
Oceaneering has witnessed upward earnings estimate revisions for 2023 and 2024 in the past 60 days. The consensus estimate for OII’s 2023 and 2024 earnings per share is pegged at $1.12 and $1.29, respectively.
Global Partners is a leading operator of gasoline stations and convenience stores. Over the past 60 days, GLP has witnessed upward earnings estimate revisions for 2023 and 2024, respectively.
The Zacks Consensus Estimate for Global Partners’ 2023 and 2024 earnings per share is pegged at $3.85 and $3.61, respectively. GLP currently has a Zacks Style Score of A for Value and Momentum.
Evolution Petroleum is an independent energy company. EPM has a Zacks Style Score of A for Growth.
Evolution Petroleum has witnessed upward earnings estimate revisions for 2023 and 2024 in the past 60 days. The consensus estimate for EPM’s 2023 and 2024 earnings per share is pegged at $1.11 and $1.08, respectively.
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Hess (HES) Tops on Q2 Earnings, Raises '23 Production Outlook
Hess Corporation (HES - Free Report) has reported second-quarter 2023 earnings per share of 65 cents, beating the Zacks Consensus Estimate of 57 cents. However, the bottom line significantly declined from the year-ago quarter’s $2.15 per share.
Total quarterly revenues dipped to $2,320 million from $2,988 million a year ago. The top line also missed the Zacks Consensus Estimate of $2,408 million.
Better-than-expected quarterly earnings were driven by higher oil-equivalent production volumes. The positives were partially offset by lower realizations of commodity prices.
Hess Corporation Price, Consensus and EPS Surprise
Hess Corporation price-consensus-eps-surprise-chart | Hess Corporation Quote
Operational Update
Exploration and Production:
For the quarter under review, the Exploration and Production business has reported adjusted earnings of $237 million, declining from $723 million a year ago. The business was negatively impacted by a dip in realized commodity prices.
Quarterly hydrocarbon production was 387 thousand barrels of oil equivalent per day (MBoe/d), up from 322 MBoe/d in the year-ago period primarily due to higher production in Guyana and the Bakken.
Crude oil production increased from 176 thousand barrels per day (MBbls/d) in second-quarter 2022 to 216 MBbls/d in the quarter under review. Natural gas liquid production totaled 69 MBbls/d, up from 49 MBbls/d in the prior-year quarter. Also, natural gas production was 610 thousand cubic feet per day (Mcf/d), up from 580 Mcf/d a year ago.
Worldwide crude oil realization per barrel of $73.74 (excluding the impacts of hedging) significantly declined from $109.51 in the year-ago period. Also, worldwide natural gas prices fell to $3.82 per Mcf from the year-ago figure of $6.45. The average worldwide natural gas liquids’ selling price declined to $17.95 per barrel from $40.92 a year ago.
Midstream:
From the midstream business, the company generated adjusted net earnings of $62 million, down from $65 million a year ago.
Operating Expenses
Operating expenses for the second quarter totaled $454 million versus the year-ago level of $356 million. Exploration expenses increased to $99 million from $33 million in the year-ago period. However, marketing costs declined to $547 million from $843 million a year ago.
Total costs and expenses increased to $1,955 million for the quarter from $1,906 million a year ago.
Financials
Net cash provided by operating activities was $974 million for the second quarter. Hess’ capital expenditure for exploration and production activities totaled $933 million.
As of Jun 30, 2023, the company had $2,226 million in cash and cash equivalents. Its long-term debt was $8,459 million at the second-quarter end.
Guidance
For 2023, Hess expects net production guidance (excluding Libya) of 385,000-390,000 barrels of oil equivalent per day (Boe/d), an increase from the previously mentioned 365,000-375,000 Boe/d. The metric suggests a rise from the 344,000 Boe/d reported in 2022.
The upgraded guidance is mainly due to the company’s strong operating performance and the expected start-up of the Payara development project at the beginning of the fourth quarter.
Zacks Rank & Stocks to Consider
Hess currently carries a Zacks Rank #3 (Hold).
Some better-ranked players in the energy sector are Oceaneering International, Inc. (OII - Free Report) , Global Partners (GLP - Free Report) and Evolution Petroleum Corporation (EPM - Free Report) , currently sporting a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
One of the leading suppliers of integrated technology solutions, Oceaneering boasts an impressive portfolio of diversified products and services. OII has a Zacks Style Score of B for Growth and Momentum.
Oceaneering has witnessed upward earnings estimate revisions for 2023 and 2024 in the past 60 days. The consensus estimate for OII’s 2023 and 2024 earnings per share is pegged at $1.12 and $1.29, respectively.
Global Partners is a leading operator of gasoline stations and convenience stores. Over the past 60 days, GLP has witnessed upward earnings estimate revisions for 2023 and 2024, respectively.
The Zacks Consensus Estimate for Global Partners’ 2023 and 2024 earnings per share is pegged at $3.85 and $3.61, respectively. GLP currently has a Zacks Style Score of A for Value and Momentum.
Evolution Petroleum is an independent energy company. EPM has a Zacks Style Score of A for Growth.
Evolution Petroleum has witnessed upward earnings estimate revisions for 2023 and 2024 in the past 60 days. The consensus estimate for EPM’s 2023 and 2024 earnings per share is pegged at $1.11 and $1.08, respectively.