Occidental Announces Third Quarter 2023 Results

Source Press Release
Company Occidental Petroleum Corporation 
Tags Production/Development, Upstream Activities, Capital Spending, Guidance, Strategy - Corporate, Financial & Operating Data
Date November 07, 2023

Strong operational performance drove operating cash flow of $3.1 billion and cash flow from operations before working capital of $3.3 billion

  • Capital spending of $1.6 billion, resulting in quarterly free cash flow before working capital of $1.7 billion
  • Production of 1,220 Mboed exceeded the mid-point of guidance by 34 Mboed; full-year production guidance raised 11 Mboed
  • OxyChem exceeded guidance with pre-tax income of $373 million
  • Repurchased $600 million of common stock, with year-to-date purchases accounting for approximately 60% of the $3.0 billion repurchase program
  • Triggered the redemption of $342 million of preferred stock, bringing year-to-date redemptions to over $1.5 billion or 15% of preferred equity
  • Secured joint venture partner for first Direct Air Capture plant
  • Earnings per diluted share of $1.20 and adjusted earnings per diluted share of $1.18

Occidental (NYSE: OXY) today announced net income attributable to common stockholders for the third quarter of 2023 of $1.2 billion, or $1.20 per diluted share, and adjusted income attributable to common stockholders of $1.1 billion, or $1.18 per diluted share.

"Our teams continued their outstanding performance across all three of our business segments resulting in our strongest earnings and cash flow from operations to date this year," said President and Chief Executive Officer Vicki Hollub. "We have now completed approximately 60% of our $3.0 billion share repurchase program and retired over 15% of the preferred equity, all while advancing our low carbon initiatives both domestically and internationally."

Third quarter after-tax items affecting comparability of $22 million were primarily comprised of after-tax gains on sales of $111 million related to certain non-core proved and unproved properties in the Permian Basin and $40 million for the sale of 5.1 million Western Midstream Partners, LP (WES) limited partner units, partially offset by derivative losses in marketing of $63 million, preferred stock redemption premiums of $42 million and other equity method investment charges of $27 million.

QUARTERLY RESULTS

Oil and Gas

Oil and gas pre-tax income for the third quarter of 2023 was $2.0 billion, compared to pre-tax income of $1.1 billion for the second quarter of 2023. Excluding items affecting comparability, third quarter oil and gas income improved from the prior quarter due to higher domestic crude oil prices and volumes. For the third quarter of 2023, average WTI and Brent marker prices were $82.26 per barrel and $86.08 per barrel, respectively. Average worldwide realized crude oil prices increased by approximately 10% from the prior quarter to $80.70 per barrel. Average worldwide realized NGL prices increased by approximately 10% from the prior quarter to $21.04 per barrel. Average domestic

realized gas prices increased by approximately 41% from the prior quarter to $1.92 per thousand cubic feet (Mcf).

Total average global production of 1,220 thousand barrels of oil equivalent per day (Mboed) for the third quarter exceeded the midpoint of guidance by 34 Mboed. Rockies & Other Domestic and Gulf of Mexico daily production volumes exceeded guidance at 263 Mboed and 146 Mboed, respectively, and Permian came in at the high end of guidance at 588 Mboed. International volumes came in just below guidance at 223 Mboed.

OxyChem

OxyChem pre-tax income of $373 million for the third quarter of 2023 exceeded guidance. Compared to second quarter of 2023 income of $436 million, the decrease in third quarter income was driven primarily by lower realized caustic soda prices.

Midstream and Marketing

Midstream and marketing pre-tax results for the third quarter of 2023 reflected a loss of $130 million, compared to a loss of $30 million for the second quarter of 2023. WES adjusted equity method investment income for the third quarter was $138 million. Excluding items affecting comparability, the increase in midstream and marketing pre-tax third quarter results, compared to the second quarter, reflected higher crude margins due the timing impact of crude sales in the marketing business, partially offset by higher expenses due to the increase in activities in the low carbon ventures businesses.

Supplemental Non-GAAP Measures

This press release refers to adjusted income (loss), cash flow from operations before working capital and free cash flow, which are supplemental measures not calculated in accordance with generally accepted accounting principles in the United States (GAAP). These Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as an alternative to the comparable GAAP financial measures. Definitions of adjusted income (loss) and a reconciliation to net income (loss), along with cash flow from operations before working capital and free cash flow and a reconciliation to the comparable GAAP financial measures, are included in the financial schedules of this press release. Occidental’s definition of adjusted income (loss), cash flow from operations before working capital and free cash flow may differ from similarly titled measures provided by other companies in our industry and as a result may not be comparable.

Source: EvaluateEnergy® ©2024 EvaluateEnergy Ltd