U.S. energy giant
) reported strong fourth quarter earnings on the back of higher
refining profitability and a rise in upstream volumes.
Earnings per share (excluding adjustments for foreign-currency
effects and a gain from an asset exchange) came in at $3.06,
ahead of the Zacks Consensus Estimate of $3.03 and the previous
The integrated supermajor's quarterly revenue increased 1.0% year
over year to $60,552.0 million from $59,985.0 million, but was
4.0% below the Zacks Consensus Estimate amid lower crude prices.
Chevron is the third of the integrated supermajors to come out
with fourth quarter results. Fellow biggie
Exxon Mobil Corp.
) also reported today, while Europe's largest oil company
Royal Dutch Shell plc
) released results yesterday.
Chevron's total production of crude oil and natural gas increased
1.0% from the year-earlier level to 2,668 thousand oil-equivalent
barrels per day (MBOE/d). Volume gains in Thailand, the U.S. and
Nigeria as well as contribution from the newly bought Delaware
Basin assets were somewhat negated by normal field declines and
the continued shut-in of the Frade deepwater field in Brazil.
The U.S. output improved 2.0% year over year, while Chevron's
international operations (accounting for 75% of the total)
experienced a 0.7% increase in volumes. Gains on the production
front were partially offset by depressed crude and North American
gas prices, the net effect resulting in a 19.5% year-over-year
rise in upstream earnings to $6,858.0 million.
Chevron's production outlook remains one of the most robust in
its peer group, with a number of major initiatives scheduled to
come online during the next few years. Major start-ups during the
last few months include the deepwater Usan project in Nigeria and
the Caesar/Tonga project in the deepwater Gulf of Mexico.
Amongst the major upcoming projects, Chevron's Gorgon and
Wheatstone natural gas initiatives in Australia are progressing
Chevron's downstream segment achieved earnings of $925 million, a
significant improvement from the loss of $61.0 million last year.
The turnaround can primarily be attributed to better profit
margins, increased earnings from the 50%-owned Chevron Phillips
Chemical Company LLC and higher gains on asset sales.
Capital Expenditure, Balance Sheet & Share
The second-largest U.S. oil company by market value after Exxon
Mobil spent $11,556.0 million in capital expenditures during the
quarter. Approximately 86% of the total outlays pertained to
As of Dec 31, 2012, the San Ramon, California-based company had
$20,939.0 million in cash and total debt of $12,192.0 million,
with a debt-to-total capitalization ratio of about 8.2%. As part
of the stock repurchase program announced in 2010, Chevron
repurchased $1,250.0 million worth of shares in the fourth
Chevron currently carries a Zacks Rank #3 (Hold), implying
that it is expected to perform in line with the broader U.S.
equity market over the next one to three months.
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