Energy
Friday, April 26th, 2024 4:26 pm EDT
Key Points
- Chevron beat earnings expectations for the first quarter, reporting adjusted earnings per share of $2.93 compared to the expected $2.87, but its profit declined from the previous year.
- Despite beating earnings estimates, Chevron’s net income fell by 16% to $5.5 billion, with revenue also dropping to $48.72 billion from $50.79 billion a year ago, missing analysts’ expectations.
- Lower sales margins at refineries and decreased natural gas prices impacted Chevron’s profitability, particularly in its refining business in the U.S. and internationally. However, the company saw increased earnings in its U.S. oil and gas business due to higher sales volume, with production gains attributed to strong output in the Permian and Denver-Julesburg basins. Additionally, Chevron remains confident in its pending acquisition of Hess Corp. and expects to complete the deal in 2024 despite legal challenges.
Chevron’s first-quarter earnings report revealed a mixed picture for the oil major. While the company beat Wall Street expectations for adjusted earnings per share at $2.93, compared to the anticipated $2.87, its revenue of $48.72 billion fell short of analysts’ projections of $50.66 billion. Despite the earnings beat, Chevron’s net income declined by 16% to $5.5 billion, or $2.97 per share, compared to the same period last year when it earned $6.57 billion, or $3.46 per share. The decrease in profits was attributed to challenges in its refineries and international gas business, with lower sales margins and declining natural gas prices impacting profitability. Chevron’s refining business in the U.S. and internationally saw significant declines in earnings, while its U.S. oil and gas segment recorded a 16% increase in earnings due to higher sales volume. The company attributed production gains to strong output in the Permian and Denver-Julesburg basins. However, international oil and gas earnings fell by 6% as production decreased due to maintenance in Nigeria and field declines. Despite these challenges, Chevron remains confident in its pending acquisition of Hess Corp., expecting the shareholder vote and regulatory approvals to be completed in the second quarter. Additionally, Chevron increased its capital expenditures by 37% to $4.1 billion, focusing on oil and gas production and assets acquired from PDC Energy. Although Chevron maintained dividend payments and share repurchases, its return on capital declined to 12.4% from 14.6% in the first quarter of the previous year.
For the full original article on CNBC, please click here: https://www.cnbc.com/2024/04/26/chevron-cvx-q1-earnings-report-2024.html
