Chevron Corp came out with a surprise Q3 profit with oil prices recovering from “spring lows” while cutting down on the spending budget helped in “operating results”.
Given the drop in demand as well as crude prices, near “40% below” from the figures seen in the starting of the year, Chevron along with its peers have been forced to cut down on spending. Similarly, Royal Dutch Shell Plc as well as BP Plc also witnessed higher Q3 results than expected numbers following the restrains on spending.
According to Reuters:
“The second-largest U.S. oil producer reported earnings of $201 million, or 11 cents per share, excluding one-time items. That compared with a profit of $2.9 billion, or $1.55 per share, a year earlier”.
While, Wall Street had forecasted a loss of 27%in Q3. Premarket trading saw a fraction rise in shares to “$68.97”. However, the CFO, Pierre Breber doesn’t want to soon conclude that the worst decline due to pandemic was over, as he added that consumption of energy “depends on when the world - this country and other countries - get control of the pandemic and those activities resume. We don’t know when that’s going to be”.
According to Breber is almost done with the operations restructuring given the “prolonged period of low prices”, whereby reducing 15% of its workforce. And Reuters informed:
“Despite lower volumes, it posted modest operating profit in oil and gas production and refining by cutting expenses 12% and spending on new projects by 48%, excluding acquisitions, both from year-ago levels”.
The C.E.O, Michael Wirth said:
“The world’s economy continues to operate below pre-pandemic levels, impacting demand for our products which are closely linked to economic activity”.
In the words of Edward Jones analyst Jennifer Rowland:
“Chevron generated enough cash flow to cover its capital spending and had only a modest deficit after funding its dividend”.
“The company’s strong balance sheet and liquidity position supports its dividend during this difficult period. We view the company as a defensive holding in a challenging industry.”
References:
reuters.com
Given the drop in demand as well as crude prices, near “40% below” from the figures seen in the starting of the year, Chevron along with its peers have been forced to cut down on spending. Similarly, Royal Dutch Shell Plc as well as BP Plc also witnessed higher Q3 results than expected numbers following the restrains on spending.
According to Reuters:
“The second-largest U.S. oil producer reported earnings of $201 million, or 11 cents per share, excluding one-time items. That compared with a profit of $2.9 billion, or $1.55 per share, a year earlier”.
While, Wall Street had forecasted a loss of 27%in Q3. Premarket trading saw a fraction rise in shares to “$68.97”. However, the CFO, Pierre Breber doesn’t want to soon conclude that the worst decline due to pandemic was over, as he added that consumption of energy “depends on when the world - this country and other countries - get control of the pandemic and those activities resume. We don’t know when that’s going to be”.
According to Breber is almost done with the operations restructuring given the “prolonged period of low prices”, whereby reducing 15% of its workforce. And Reuters informed:
“Despite lower volumes, it posted modest operating profit in oil and gas production and refining by cutting expenses 12% and spending on new projects by 48%, excluding acquisitions, both from year-ago levels”.
The C.E.O, Michael Wirth said:
“The world’s economy continues to operate below pre-pandemic levels, impacting demand for our products which are closely linked to economic activity”.
In the words of Edward Jones analyst Jennifer Rowland:
“Chevron generated enough cash flow to cover its capital spending and had only a modest deficit after funding its dividend”.
“The company’s strong balance sheet and liquidity position supports its dividend during this difficult period. We view the company as a defensive holding in a challenging industry.”
References:
reuters.com
