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Chevron reported mixed second quarter results Friday along with fellow oil major ExxonMobil. $CVX net oil-equivalent production rose 9% to 3.08 million bpd as unconventional production in the Permian Basin rose more than 50% to 421,000 ppd.

Chevron Gas Station

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

$1.59 Beat $1.47 EPS BUT $36.12 Missed $39.06 Billion Revenue Forecast

Earnings

Chevron Corp. (NYSE: CVX) reported third quarter results on Friday with EPS of $1.59, after excluding a tax charge, on revenue of $36.12 billion. Wall Street had seen Chevron earnings per share declining 30% to $1.47 with sales down 11% to $39.06 billion. Net income attributable to Chevron was $2.5 billion, or $1.36 per share, compared to $4 billion, or $2.11 per share, in the prior-year period.

 

Chevron Corporation NYSE: CVX

Market Reaction Lunch $116.40 +0.25 (+0.22%)

After Being Down 1.5% Premarket

Highlights

CEO Michael Wirth said, “Lower crude oil and natural gas prices more than offset a 3% increase in net oil-equivalent production from last year’s third quarter.”

  • Production rose 3% to 3.03 million barrels of oil equivalent per day.
  • Permian shale output jumped 35% to 455,000 barrels per day.
  • Capital sending dipped 3.3% to $4.96 billion. 

Upstream

  • Upstream income fell 20% to $2.7 billion
  • In the Upstream division, worldwide net oil-equivalent production was 3.03 million barrels per day, up 3% from a year ago.
  • Earnings from the US upstream operations fell 12% to $727 million
  • Earnings from the international upstream operations dropped 22% to $1.98 billion year-over-year, mainly due to lower crude oil and natural gas realizations.

Downstream

  • Downstream income plunged 40% to $828 million.
  • Earnings in the US downstream operations declined 47% year-over-year to $389 million due to higher operating expenses, and lower margins on refined product sales.
  • Earnings from international downstream operations decreased 29% to $439 million, largely due to the absence of 2018 gains from the southern Africa asset sale.

CSX Corp Q3 2019 Earnings

In September, Chevron sanctioned a waterflood project in the St. Malo Field in the Gulf of Mexico. The company also acquired deepwater exploration blocks in the Mexican Gulf of Mexico and Brazil’s Campos and Santos basins, strengthening its deepwater exploration portfolio.

In May, Chevron completed the acquisition of Pasadena Refining System Inc. for $350 million. The same month, the company also decided to not pursue the acquisition of Anadarko Petroleum Corp. (NYSE: APC). Anadarko has agreed to be acquired by Occidental Petroleum (NYSE: OXY).

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, AlphaStreet, XOM, CVX

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