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Oasis Petroleum (OAS) Incurs Wider-Than-Expected Q1 Loss

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Oasis Petroleum Inc. (OAS - Free Report) incurred first-quarter 2020 adjusted loss per share of 20 cents, wider than the Zacks Consensus Estimate of a loss of 17 cents. However, in the year-ago period, the company earned a profit of 6 cents per share. These underperformances can be attributed to lower realized oil and gas prices.

The company’s total operating revenues of $387.8 million surpassed the Zacks Consensus Estimate of $324 million on higher-than-expected production. Precisely, this upstream player’s output of 80.06 thousand oil-equivalent barrels per day (MBOE/d) beat the Zacks Consensus Estimate of 78.7 MBOE/d. However, the top line fell from the year-ago figure of $575.7 million due to weak production.

Production & Price Realizations

Total production (comprising 67.6% oil) declined 12.7% from the year-ago level to 80.06 MBOE/d. While oil volume came in at 54.1 thousand barrels per day (down 18.08% year over year), natural gas totaled 155,776 thousand cubic feet per day (up 1.15%).

The average realized crude oil price during the first quarter was $43.22 per barrel, reflecting a 19.2% decrease from the prior-year realization of $53.52. Moreover, the average realized natural gas price was $1.86 per thousand cubic feet, down 49.1% from the year-earlier period.

Total Expenses

Total operating expenses in the quarter soared to $5.3 billion from the year-ago quarter’s $522.4 million. This was mainly on account of non-cash impairment losses of $4.8 billion associated with the plunge in commodity prices. Meanwhile, purchased oil and gas expenses were $85.2 million compared with $149.9 million in the corresponding quarter of last year.

The company’s lease operating expenses declined to $6.83 per barrel of oil equivalent (Boe) from the year-ago figure of $7.08 per Boe.

Financial Position

Capital spending (before acquisitions) totaled $178.8 million in the quarter. Oasis Petroleum recorded $107.8 million in net cash flow from operations, lower than the year-ago period’s $174.9 million.

As of Mar 31, this Bakken-focused operator had $134 million in cash and cash equivalents. The company had long-term debt of $2.77 billion.

Guidance

Oasis Petroleum trimmed its current-year E&P capex outlook by 50-60%, indicating a decline from the previously-issued guided range of $575-$595 million with the capex for the second to fourth-quarter period projected in the $80-$140 million band.

The company further slashed its 2020 Midstream capex guidance by 65-70% to the range of $35-$40 million with roughly 35% attributable to Oasis.

Oasis Petroleum suspended its 2020 output and operating expenses outlook due to the coronavirus-induced market disruptions and the uncertainty remaining around persistent production constraints over the near future.

Zacks Rank & Snapshots of Other Energy Players’ Earnings Report

Oasis Petroleum has a Zacks Rank #3 (Hold). Among other players in the energy sector that reported first-quarter earnings so far, the bottom-line results of Cheniere Energy Inc. (LNG - Free Report) , Murphy USA Inc. (MUSA - Free Report) and Williams Companies Inc. (WMB - Free Report) beat the respective Zacks Consensus Estimate by 204.3%, 4.3% and 4%. While Cheniere Energy and Williams Companies carry a Zacks Rank #2 (Buy), Murphy sports a Zacks Rank #1 (Strong Buy).You can see the complete list of today’s Zacks #1 Rank stocks here.

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