Back to top

Image: Bigstock

Occidental (OXY) Q3 Earnings Miss Estimates, Sales Beat

Read MoreHide Full Article

Occidental Petroleum Corporation (OXY - Free Report) reported third-quarter 2019 earnings of 11 cents per share, lagging the Zacks Consensus Estimate of 41 cents by 73.2%. The bottom line was also significantly lower than $1.77 per share recorded in the prior-year quarter.

Total Revenues

Occidental's total revenues were $5,871 million, beating the Zacks Consensus Estimate of $5,690 million by 3.2%. However, the top line declined 4.9% from $6,176 million in the year-ago quarter.

Production & Sales

Occidental’s average daily net oil, liquids and gas production volume expanded to 1,155,000 barrels of oil equivalent per day (boe/d), which included the acquired Anadarko assets. The metric was 681,000 boe/d in the prior-year quarter.

This improvement in production volume was backed by higher drilling activity and solid output from the Permian Resources region. Permian Resources production improved 33% year over year.

In the quarter under review, total sales volume was 1,157,000 boe/d compared with 696,000 boe/d recorded in the year-ago period.

Occidental Petroleum Corporation Price, Consensus and EPS Surprise

 

Occidental Petroleum Corporation Price, Consensus and EPS Surprise

Occidental Petroleum Corporation price-consensus-eps-surprise-chart | Occidental Petroleum Corporation Quote

Realized Prices

Realized prices for crude oil in the third quarter dropped 10.2% year over year to $56.26 per barrel on a worldwide basis. Worldwide realized NGL prices also decreased 49.4% from the prior-year quarter to $14.96 per barrel. Moreover, worldwide natural gas prices were down 14.8% from the year-ago quarter to $1.38 per thousand cubic feet.

The overall decline in realized prices of the commodities did not allow the company to realize full benefits of higher production and sales volumes in the reported quarter.

Highlights of the Release

Its acquisition deal with Anadarko Petroleum has progressed per expectation. This boosted total production in the third quarter and strengthened Occidental’s presence in the resource-rich Permian Basin.

Selling, general and administrative, as well as other operating expenses in the third quarter were $242 million, up 60.3% from $151 million a year ago.

Interest expenses in the reported quarter were $381 million compared with $96 million in the year-ago period.

Occidental’s management, which continues to increase the value of its shareholders, returned $1,766 million in the first nine months of 2019 through dividend payments.

Financial Position

As of Sep 30, 2019, Occidental had cash and cash equivalents of 4,840 million compared with $3,033 million on Dec 31, 2018.

As of Sep 30, 2019, the company had a long-term debt (net of current portion) of $39,946 million compared with $10,201 million on Dec 31, 2018. The increase in the debt level was due to the loan taken by the company to fund the acquisition of Anadarko.

In third-quarter 2019, cash from operations was $2,478 million, up from $2,404 million in the prior-year period.

In third-quarter 2019, Occidental’s total capital expenditure was $1,714 million, up from $1,319 million invested in the year-ago period.

Guidance

Occidental expects fourth-quarter 2019 production in the range of 1,312,000-1,336,000 boe/d. Production from Permian Resources is expected in the range of 449,000-459,000 boe/d.

Zacks Rank

Currently, Occidental carries a Zacks Rank #5 (Strong Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Oil & Energy Releases

Chevron Corporation (CVX - Free Report) reported adjusted third-quarter earnings per share of $1.59, surpassing the Zacks Consensus Estimate of $1.47.

BP plc (BP - Free Report) reported third-quarter 2019 adjusted earnings of 66 cents per American Depositary Share (ADS) that surpassed the Zacks Consensus Estimate of 53 cents.

Royal Dutch Shell plc (RDS.A - Free Report) reported earnings per ADS of $1.18, beating the Zacks Consensus Estimate of 98 cents.

More Stock News: This Is Bigger than the iPhone!

It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.

Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.

Click here for the 6 trades >>