EOG Resources Cuts Capital Budget, Records $1.57 Billion in Charges
May 07 2020 - 5:22PM
Dow Jones News
By Micah Maidenberg
EOG Resources Inc. said Thursday it would cut $1 billion more
out of its capital-spending plan for the year, another example of
how shale-oil companies are pushing to conserve cash as the
Covid-19 pandemic puts tremendous pressure on demand for crude.
The company also recorded $1.57 billion in impairments in the
quarter, weighing on profit. Net income plunged to $9.8 million, or
2 cents a share, for the first quarter, from $635.4 million, or
$1.10 a share, a year earlier.
"These unprecedented market conditions have super-charged our
unique culture to vigorously lower costs and generate innovative
productivity gains," Chief Executive William Thomas said in a
statement.
The company said revenue rose to $4.72 billion for the first
quarter from $4.06 billion a year earlier.
For 2020, EOG now expects capital spending of $3.3 billion to
$3.7 billion, $1 billion less than its last plan. The new forecast
is $3 billion lower than its original plan given at the start of
the year.
The company said its new strategy for the year reflects "the
significant decline and increased volatility of commodity prices"
and its goal to generate strong returns and support its
dividend.
Average crude selling prices in the U.S. fell 16% year over year
to $46.97 a barrel, EOG said.
Write to Micah Maidenberg at micah.maidenberg@wsj.com
(END) Dow Jones Newswires
May 07, 2020 17:07 ET (21:07 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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