Chevron Swings To Profit On Cost Cuts, Higher Oil Prices
April 28 2017 - 09:55AM
Dow Jones News
By Anne Steele
Chevron Corp. swung to a profit in the first quarter as the
oil-and-gas giant's expense-slashing efforts pay off and a tough
pricing environment shows signs of softening.
Shares in the No. 2 energy company in the U.S., down 11% so far
this year, gained 1.7% premarket Friday to $107.21.
Pressured by the prolonged swoon in oil prices cutting into
profitability, the San Ramon, Calif.-based company has launched
efforts to slash thousands of jobs and cut billions of dollars from
its capital-spending budget. Chevron said it had 55,200 employees
at the end of 2016, down 15% from the end of 2014.
"We continue to make good progress on reducing our spend," said
Chief Executive John Watson.
In the latest period, operating expenses were 14% percent lower
than a year ago and capital spending declined more than 30%.
The company's average sales price per barrel of crude oil and
natural gas liquids was $49, up from $29 in the year-ago
period.
In all for the March quarter, Chevron reported a profit of $2.68
billion, or $1.41 a share, compared with a loss of $725 million, or
39 cents a share, the year before. Analysts polled by Thomson
Reuters expected Chevron to report earnings of 86 cents a
share.
Revenue surged 42% to $33.42 billion, topping the average
analyst estimate of $33.3 billion.
Profit in Chevron's downstream, or refining, operations jumped
26% to $926 million in the quarter.
Upstream operations, which include exploration and drilling,
meanwhile, in the U.S., swung to an $80 million profit from a $850
million loss a year earlier. Higher crude oil prices and lower
depreciation and operating expenses fueled the swing to
profitability.
Rival Exxon Mobil Corp., the largest U.S. oil company, on Friday
said its profit more than doubled in the first quarter, signaling a
strengthening in business amid a reprieve in commodity price
depression.
Write to Anne Steele at anne.steele@wsj.com
(END) Dow Jones Newswires
April 28, 2017 09:40 ET (13:40 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
Chevron (NYSE:CVX)
Historical Stock Chart
From Feb 2024 to Mar 2024
Chevron (NYSE:CVX)
Historical Stock Chart
From Mar 2023 to Mar 2024