Noble Energy Surpasses Ests

Noble Energy Inc. (NBL - Analyst Report) posted adjusted earnings per share of $1.10 for the third quarter, which surpassed the Zacks Consensus Estimate of 81 cents. However, earnings was substantially lower than $2.08 recorded during the corresponding period of last year. The better-than-expected results in the quarter were driven by increased sales volumes and reduced costs compared to the second quarter and the year-ago period.
 
Consolidated sales volumes improved 3% to 20 million BOE, i.e., 217 thousand BOE per day, primarily driven by increased volumes in the United States and West Africa. Volumes rose in the U.S. supported by ongoing development activity at Wattenberg, the return to full production of Ticonderoga, and the impact of the Raton gas project in the deepwater Gulf of Mexico. Reduced facility maintenance downtime helped increase natural gas volumes in West Africa. However, volumes declined in North Sea due to the Dumbarton performance. Daily sales volumes of oil, natural gas and NGL averaged 67 thousand barrels (down 3%), 802 million cubic feet (up 6%) and 16 thousand barrels (up 7%), respectively.
 
Revenues dipped 43% to $621 million due to lower price realization. Revenues from oil, natural gas and NGL were $377 million (down 40%), $172 million (down 52%) and $24 million (down 52%), respectively. Realized prices for oil, natural gas and NGL averaged $63.4 per barrel (down 38%), $2.4 per thousand cubic feet (down 55%) and $25.4 per barrel (down 56%), respectively.
 
Noble has benefited from the continued downward pressure on service and supply costs due to weak activity levels across the industry. Cash costs, including lease operating expenses, production and ad valorem taxes, transportation, and SG&A were down 19% to $9.22 per BOE.
 
The company has maintained a healthy financial and liquidity position. Cash provided by operating activities was $488 million, covering the bulk of capex $224 million. Noble ended the quarter with $926 million of cash and debt to capital of 26%.

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