ConocoPhillips Reports Second-Quarter 2019 Results

ConocoPhillips (NYSE: COP) today reported second-quarter 2019 earnings of $1.6 billion, or $1.40 per share, compared with second-quarter 2018 earnings of $1.6 billion, or $1.39 per share. Excluding special items, second-quarter 2019 adjusted earnings were $1.1 billion, or $1.01 per share, compared with second-quarter 2018 adjusted earnings of $1.3 billion, or $1.09 per share.

Special items for the current quarter were primarily driven by a financial tax benefit related to the previously announced U.K. disposition, settlement of certain tax disputes, and amounts recognized from the PDVSA International Chamber of Commerce (ICC) settlement.

Second-Quarter Highlights

  • Cash provided by operating activities was $2.9 billion. Excluding working capital, cash from operations (CFO) of $3.4 billion exceeded capital expenditures and investments, generating free cash flow of $1.7 billion.
  • Increased 2019 planned share repurchases to $3.5 billion.
  • Repurchased $1.2 billion of shares and paid $0.3 billion in dividends in the second quarter; both funded entirely from free cash flow, representing a return of 47 percent of CFO to shareholders.
  • Second-quarter production excluding Libya of 1,290 MBOED exceeded the high end of guidance; year-over-year underlying production grew 4 percent overall and 6 percent on a per debt-adjusted share basis.  
  • Grew production from the Lower 48 Big 3 unconventionals by 26 percent year-over-year.
  • Executed turnarounds in Europe, Canada and Alaska.
  • Ended the quarter with cash, cash equivalents and restricted cash totaling $6.2 billion and short-term investments of $0.7 billion, equating to $6.9 billion of ending cash and short-term investments.
  • Generated $0.6 billion in proceeds from dispositions.
  • Acquired approximately $0.1 billion in Lower 48 Big 3 bolt-on interests and acreage.

“This was our seventh consecutive quarter of generating free cash flow while executing our disciplined plans and delivering on our targets,” said Ryan Lance, chairman and chief executive officer. “Over that time frame we fully funded our capital expenditures, dividends and buybacks within cash from operations. ConocoPhillips has embraced an approach to our cyclical industry that we believe will deliver superior returns and create value across a range of commodity prices. This quarter represents a continuation of strong performance on our business model that prioritizes financial returns, discipline, resilience with upside and shareholder distributions. At our Analyst & Investor Meeting in November we will lay out a plan that demonstrates our ability to successfully perform on this model for the long term.”

Second-Quarter Review

Production excluding Libya for the second quarter of 2019 was 1,290 thousand barrels of oil equivalent per day (MBOED), an increase of 79 MBOED compared with the same period a year ago.

Excluding a net benefit of 27 MBOED from acquisitions and dispositions (A&D), production increased by 52 MBOED primarily due to growth from the Big 3 unconventionals, development programs and major projects in Alaska, Europe and Asia Pacific. This growth more than offset normal field decline and downtime from planned turnarounds. Production from Libya was 42 MBOED.

Source / More : ConocoPhillips

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