Chevron Earnings Highest Since First Quarter 2013 With Soaring Oil and Natural Gas prices in 2021

Chevron reported better than expected third quarter earnings Friday. With oil and natural gas prices at significant highs $CVX reported earnings of $6.1 billion and cash flow from operations of $8.6 billion with record free cash flow of $6.7 billion and share repurchases of $625 million. Fellow oil major Exxon also reported Friday.

Chevron reported better than expected third quarter earnings Friday. With oil and natural gas prices at significant highs $CVX reported earnings of $6.1 billion and cash flow from operations of $8.6 billion with record free cash flow of $6.7 billion and share repurchases of $625 million. Fellow oil major Exxon also reported Friday.

Chevron Gas Station

Chevron is the US’s second biggest oil company after Exxon

Chevron Inc. (NYSE: $CVX) Reported Earnings Before Open Friday

$2.96 Beat $2.21 EPS AND $37.6 Beat $40.52 Billion Revenue Forecast

Earnings release: before market; conference call: 11 a.m.

Chevron Corporation Q321 Earnings:

Chevron Corporation (NYSE: CVX) reported earnings of $6.1 billion ($3.19 per share – diluted) for third quarter 2021, compared with a loss of $207 million ($(0.12) per share – diluted) in third quarter 2020. Adjusted quarterly earnings were $2.96 per share, beating consensus estimate of $2.21 per share. This compares to earnings of $0.11 per share a year ago. These figures are adjusted for non-recurring items. Revenues of $44.71 billion for the quarter ended September 2021, surpassed the $40.52 billion consensus estimate by 5.28%.This compares to year-ago revenues of $24.45 billion.

Included in the current quarter were asset sale gains of $200 million and pension settlement costs of $81 million. Foreign currency effects increased earnings by $305 million. Adjusted earnings of $5.7 billion ($2.96 per share – diluted) in third quarter 2021 compares to adjusted earnings of $340 million ($0.18 per share – diluted) in third quarter 2020. Sales and other operating revenues in third quarter 2021 were $43 billion, compared to $24 billion in the year-ago period.

CVX Q3 20 to Q3 2021

 

Market CVX Reaction: Pre market114.49 ▲ 1.37 ( ▲ 1.21%)

Highlights

“Third quarter earnings were the highest since first quarter 2013 largely due to improved market conditions, strong operational performance and a lower cost structure,” said CEO Mike Wirth.

CVX Q3 2021 Production

Upstream operations:

U.S. upstream operations earned $1.96 billion in third quarter 2021, compared with $116 million a year earlier. The improvement was primarily due to higher crude oil realizations and sales volumes. Gains on assets sales during the quarter also contributed to the improvement between periods.

The company’s average sales price per barrel of crude oil and natural gas liquids was $58 in third quarter 2021, up from $31 a year earlier. The average sales price of natural gas was $3.25 per thousand cubic feet in third quarter 2021, up from $0.89 in last year’s third quarter.

Net oil-equivalent production of 1.13 million barrels per day in third quarter 2021 was up 145,000 barrels per day from a year earlier. The increase was due to an additional 224,000 barrels per day of production following the Noble Energy acquisition, partially offset by a 69,000 barrels per day decrease related to the Appalachian asset sale. The net liquids component of oil-equivalent production in third quarter 2021 increased 15 percent to 842,000 barrels per day, and net natural gas production increased 13 percent to 1.71 billion cubic feet per day, compared to last year’s third quarter.

International upstream operations earned $3.17 billion in third quarter 2021, compared with $119 million a year ago. The increase in earnings was primarily due to higher realizations and sales volumes. Foreign currency effects had a favorable impact on earnings of $392 million between periods.

The average sales price for crude oil and natural gas liquids in third quarter 2021 was $68 per barrel, up from $39 a year earlier. The average sales price of natural gas was $6.28 per thousand cubic feet in the third quarter, up from $3.89 in last year’s third quarter.

International downstream operations reported earnings of $227 million in third quarter 2021, compared with $151 million a year earlier. Foreign currency effects had a favorable impact on earnings of $172 million between periods, partially offset by higher operating expenses that were mostly related to transportation.

Refinery crude oil input of 584,000 barrels per day in third quarter 2021 increased 2 percent from the year-ago period.

Refined product sales of 1.39 million barrels per day in third quarter 2021 increased 8 percent from the year-ago period, mainly due to higher demand for gasoline and jet fuel.

Downstream operations:

U.S. downstream operations reported earnings of $1.08 billion in third quarter 2021, compared with $141 million a year earlier. The increase was mainly due to higher margins on refined product sales, higher earnings from the 50 percent-owned Chevron Phillips Chemical Company, and higher sales volumes.

Refinery crude oil input in third quarter 2021 increased 9 percent to 895,000 barrels per day from the year-ago period, as the company increased refinery runs in response to higher demand and the improved refining margin environment.

Refined product sales of 1.19 million barrels per day were up 18 percent from the year-ago period, mainly due to higher gasoline, jet fuel, and diesel demand as travel restrictions associated with the COVID-19 pandemic continue to ease

Cashflow

“Our free cash flow during the quarter was the best ever reported by the company,” Wirth added. “We paid dividends of $2.6 billion, reduced debt by $5.6 billion, and repurchased $625 million of shares during the quarter.”

Cash flow from operations in the first nine months of 2021 was $19.7 billion, compared with $8.3 billion in 2020. Excluding working capital effects, cash flow from operations in the first nine months of 2021 was $21.2 billion, compared with $8.4 billion in 2020.

Capital Expenditure

Capital and exploratory expenditures in the first nine months of 2021 were $8.1 billion, compared with $10.3 billion in 2020. The amounts included $2.3 billion in 2021 and $3.1 billion in 2020 for the company’s share of expenditures by affiliates, which did not require cash outlays by the company. Expenditures for upstream represented 84 percent of the company-wide total in 2021.

CVX Q3 2021 Carbon

 Noble

The company’s $13bn acquisition of Noble,  the first big move in a wave of mergers that swept through the battered US oil sector last year. closed in the fourth quarter of 2020. For 2018 through 2020, the company generated asset sales proceeds of $7.7 billion, in the middle of its guidance range of $5-$10 billion.

 

About Chevron

What Analysts Will Be Watching

Chevron Corp. is a U.S.-based integrated oil and gas company with worldwide operations in exploration and production, refining and marketing, transportation and petrochemicals. It has large exposure to the Permian and to LNG with the  Wheatstone Chevron LNG Facility production starting in Western Australia

The Permian Basin remains a key source of capital flexibility, and it is a key issue behind many analysts preference for Chevron versus some of the other majors. Chevron’s liquids-rich upstream segment is likely to benefit from higher crude price realizations. This segment is expected to record higher production volumes on the back of major capital projects including Gorgon, and core developments in the Gulf of Mexico and Permian Basin.

Sources: TradersCommunity, CVX

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