Chevron Corporation (NYSE:CVX) today reported a loss of $725 million
($0.39 per share – diluted) for first quarter 2016, compared with
earnings of $2.6 billion ($1.37 per share – diluted) in the 2015 first
quarter. Foreign currency effects decreased earnings in the 2016 quarter
by $319 million, compared with an increase of $580 million a year
earlier.
Sales and other operating revenues in first quarter 2016 were $23
billion, compared to $32 billion in the year-ago period.
|
|
|
|
|
|
Earnings Summary
|
|
|
|
|
Three Months
Ended March 31
|
|
Millions of dollars
|
|
|
2016
|
|
2015
|
|
Earnings by business segment
|
|
|
|
|
|
|
Upstream
|
|
|
$
|
(1,459
|
)
|
|
$
|
1,560
|
|
|
Downstream
|
|
|
|
735
|
|
|
|
1,423
|
|
|
All Other
|
|
|
|
(1
|
)
|
|
|
(416
|
)
|
|
Total (1)(2)
|
|
|
$
|
(725
|
)
|
|
$
|
2,567
|
|
|
(1) Includes foreign currency effects
|
|
|
$
|
(319
|
)
|
|
$
|
580
|
|
(2) Net income (loss) attributable to Chevron Corporation (See
Attachment 1)
|
|
|
“First quarter results declined from a year ago,” said Chairman and CEO
John Watson. “Our Upstream business was impacted by a more than 35
percent decline in crude oil prices. Our Downstream operations continued
to perform well, although overall industry conditions and margins this
quarter were weaker than a year ago.”
“Our efforts are focused on improving free cash flow,” Watson stated.
“We are controlling our spend and getting key projects under
construction online, which will boost revenues. We announced first LNG
production and first cargo shipment from Train 1 at the Gorgon Project
in March. Production from the Angola LNG plant is imminent and a cargo
shipment is expected in May. Earlier in the year, we started up
production at the Chuandongbei Project in China, and we continue to ramp
up production in the Permian Basin and elsewhere.”
“We continue to lower our cost structure with better pricing, work flow
efficiencies and matching our organizational size to expected future
activity levels,” Watson added. “Our capital spending is coming down. We
are moving our focus to high-return, shorter-cycle projects and pacing
longer-cycle investments.”
UPSTREAM
Worldwide net oil-equivalent production was 2.67 million barrels per day
in first quarter 2016, compared with 2.68 million barrels per day in the
2015 first quarter. Production increases from project ramp-ups in the
United States, Nigeria and other areas, and production entitlement
effects in several locations, were offset by the Partitioned Zone
shut-in and normal field declines.
|
|
|
|
|
|
U.S. Upstream
|
|
|
|
|
|
|
|
Three Months
Ended March 31
|
|
Millions of Dollars
|
|
|
2016
|
|
2015
|
|
Earnings
|
|
|
$
|
(850
|
)
|
|
$
|
(460
|
)
|
|
|
|
|
|
|
|
U.S. upstream operations incurred a loss of $850 million in first
quarter 2016 compared to a loss of $460 million from a year earlier. The
decrease was due to lower crude oil and natural gas realizations,
partially offset by lower operating expenses.
The company’s average sales price per barrel of crude oil and natural
gas liquids was $26 in first quarter 2016, down from $43 a year ago. The
average sales price of natural gas was $1.32 per thousand cubic feet,
compared with $2.27 in last year’s first quarter.
Net oil-equivalent production of 701,000 barrels per day in first
quarter 2016 was up 2,000 barrels per day from a year earlier.
Production increases due to project ramp-ups in the Gulf of Mexico, the
Marcellus Shale in western Pennsylvania, and the Permian Basin in Texas
and New Mexico were mostly offset by maintenance-related downtime in the
Gulf of Mexico, normal field declines and the effect of asset sales. The
net liquids component of oil-equivalent production in first quarter 2016
was essentially unchanged at 490,000 barrels per day, while net natural
gas production increased 1 percent to 1.27 billion cubic feet per day.
|
|
|
|
|
|
International Upstream
|
|
|
|
|
|
|
|
Three Months
Ended March 31
|
|
Millions of Dollars
|
|
|
2016
|
|
2015
|
|
Earnings*
|
|
|
$
|
(609
|
)
|
|
$
|
2,020
|
|
*Includes foreign currency effects
|
|
|
$
|
(298
|
)
|
|
$
|
522
|
|
|
|
|
|
|
|
International upstream operations incurred a loss of $609 million in
first quarter 2016 compared with earnings of $2.02 billion a year
earlier. The decrease was due to lower crude oil and natural gas
realizations, the absence of a first quarter 2015 reduction in statutory
tax rates in the United Kingdom, and lower gains on asset sales.
Partially offsetting these effects were higher liftings and lower
exploration expenses. Foreign currency effects decreased earnings by
$298 million in the 2016 quarter, compared with an increase of $522
million a year earlier.
The average sales price for crude oil and natural gas liquids in first
quarter 2016 was $29 per barrel, down from $46 a year earlier. The
average price of natural gas was $3.91 per thousand cubic feet, compared
with $5.01 in last year’s first quarter.
Net oil-equivalent production of 1.97 million barrels per day in first
quarter 2016 decreased 17,000 barrels per day, or 1 percent, from a year
ago. Production increases from project ramp-ups in Nigeria and other
areas, and production entitlement effects in several locations, were
more than offset by the Partitioned Zone shut-in and normal field
declines. The net liquids component of oil-equivalent production
decreased 2 percent to 1.29 million barrels per day in the 2016 first
quarter, while net natural gas production was essentially unchanged at
4.04 billion cubic feet per day.
DOWNSTREAM
|
|
|
|
|
|
U.S. Downstream
|
|
|
|
|
|
|
|
Three Months
Ended March 31
|
|
Millions of Dollars
|
|
|
2016
|
|
2015
|
|
Earnings
|
|
|
$
|
247
|
|
$
|
706
|
|
|
|
|
|
|
|
U.S. downstream operations earned $247 million in first quarter 2016
compared with earnings of $706 million a year earlier. The decrease was
primarily due to lower margins on refined products, an asset impairment,
higher operating expenses primarily due to planned turnaround activity
in first quarter 2016, and lower earnings from the 50 percent-owned
Chevron Phillips Chemical Company LLC.
Refinery crude oil input in first quarter 2016 increased 4 percent to
957,000 barrels per day from the year-ago period.
Refined product sales of 1.21 million barrels per day were unchanged
from first quarter 2015. Branded gasoline sales of 510,000 barrels per
day were up 1 percent from the 2015 period.
|
|
|
|
|
International Downstream
|
|
|
|
|
|
Three Months
Ended March 31
|
|
Millions of Dollars
|
|
2016
|
|
2015
|
|
Earnings*
|
|
$
|
488
|
|
|
$
|
717
|
|
*Includes foreign currency effects
|
|
$
|
(48
|
)
|
|
$
|
54
|
|
|
|
|
|
|
International downstream operations earned $488 million in first quarter
2016 compared with $717 million a year earlier. The decrease was
primarily due to lower margins on refined product sales, partially
offset by lower operating expenses and a favorable change in effects on
derivative instruments. Foreign currency effects decreased earnings by
$48 million in first quarter 2016, compared with an increase of $54
million a year earlier.
Refinery crude oil input of 795,000 barrels per day in first quarter
2016 increased 13,000 barrels per day from the year-ago period, mainly
due to lower turnaround activity, partially offset by the divestment of
Caltex Australia Limited.
Total refined product sales of 1.44 million barrels per day in first
quarter 2016 were down 144,000 barrels per day from the year-ago period,
mainly as a result of the Caltex Australia Limited divestment.
ALL OTHER
|
|
|
|
|
|
|
|
|
Three Months
Ended March 31
|
|
Millions of Dollars
|
|
|
2016
|
|
2015
|
|
Earnings*
|
|
|
$
|
(1
|
)
|
|
$
|
(416
|
)
|
|
*Includes foreign currency effects
|
|
|
$
|
27
|
|
|
$
|
4
|
|
|
|
|
|
|
|
|
All Other consists of worldwide cash management and debt financing
activities, corporate administrative functions, insurance operations,
real estate activities and technology companies.
Net charges in first quarter 2016 were $1 million, compared with $416
million in the year-ago period. The change between periods was mainly
due to lower corporate tax items.
CASH FLOW FROM OPERATIONS
Cash flow from operations in first quarter 2016 was $1.1 billion,
compared with $2.3 billion in the corresponding 2015 period. Excluding
working capital effects, cash flow from operations in first quarter 2016
was $2.1 billion, compared with $4.3 billion in the corresponding 2015
period.
CAPITAL AND EXPLORATORY EXPENDITURES
Capital and exploratory expenditures in first quarter 2016 were $6.5
billion, compared with $8.6 billion in the corresponding 2015 period.
The amounts included $791 million in first quarter 2016 and $730 million
in the corresponding 2015 period for the company’s share of expenditures
by affiliates, which did not require cash outlays by the company.
Expenditures for upstream represented 92 percent of the companywide
total in first quarter 2016.
NOTICE
Chevron’s discussion of first quarter 2016 earnings with security
analysts will take place on Friday, April 29, 2016, at 8:00 a.m. PDT. A
webcast of the meeting will be available in a listen-only mode to
individual investors, media, and other interested parties on Chevron’s
Web site at www.chevron.com
under the “Investors” section. Additional financial and operating
information will be contained in the Earnings Supplement that will be
available under “Events and Presentations” in the “Investors” section on
the Web site.
CAUTIONARY STATEMENTS RELEVANT TO FORWARD-LOOKING INFORMATION FOR THE
PURPOSE OF “SAFE HARBOR” PROVISIONS OF THE PRIVATE SECURITIES LITIGATION
REFORM ACT OF 1995
This press release contains forward-looking statements relating to
Chevron’s operations that are based on management’s current
expectations, estimates and projections about the petroleum, chemicals
and other energy-related industries. Words or phrases such as
“anticipates,” “expects,” “intends,” “plans,” “targets,” “forecasts,”
“projects,” “believes,” “seeks,” “schedules,” “estimates,” “may,”
“could,” “should,” “budgets,” “outlook,” “on schedule,” “on track” and
similar expressions are intended to identify such forward-looking
statements. These statements are not guarantees of future performance
and are subject to certain risks, uncertainties and other factors, many
of which are beyond the company’s control and are difficult to predict.
Therefore, actual outcomes and results may differ materially from what
is expressed or forecasted in such forward-looking statements. The
reader should not place undue reliance on these forward-looking
statements, which speak only as of the date of this report. Unless
legally required, Chevron undertakes no obligation to update publicly
any forward-looking statements, whether as a result of new information,
future events or otherwise.
Among the important factors that could cause actual results to differ
materially from those in the forward-looking statements are: changing
crude oil and natural gas prices; changing refining, marketing and
chemicals margins; the company's ability to realize anticipated cost
savings and expenditure reductions; actions of competitors or
regulators; timing of exploration expenses; timing of crude oil
liftings; the competitiveness of alternate-energy sources or product
substitutes; technological developments; the results of operations and
financial condition of the company’s suppliers, vendors, partners and
equity affiliates, particularly during extended periods of low prices
for crude oil and natural gas; the inability or failure of the company’s
joint-venture partners to fund their share of operations and development
activities; the potential failure to achieve expected net production
from existing and future crude oil and natural gas development projects;
potential delays in the development, construction or start-up of planned
projects; the potential disruption or interruption of the company’s
operations due to war, accidents, political events, civil unrest, severe
weather, cyber threats and terrorist acts, crude oil production quotas
or other actions that might be imposed by the Organization of Petroleum
Exporting Countries or other natural or human causes beyond its control;
changing economic, regulatory and political environments in the various
countries in which the company operates; general domestic and
international economic and political conditions; the potential liability
for remedial actions or assessments under existing or future
environmental regulations and litigation; significant operational,
investment or product changes required by existing or future
environmental statutes and regulations, including international
agreements and national or regional legislation and regulatory measures
to limit or reduce greenhouse gas emissions; the potential liability
resulting from other pending or future litigation; the company’s future
acquisition or disposition of assets and gains and losses from asset
dispositions or impairments; government-mandated sales, divestitures,
recapitalizations, industry-specific taxes, changes in fiscal terms or
restrictions on scope of company operations; foreign currency movements
compared with the U.S. dollar; material reductions in corporate
liquidity and access to debt markets; the effects of changed accounting
rules under generally accepted accounting principles promulgated by
rule-setting bodies; the company’s ability to identify and mitigate the
risks and hazards inherent in operating in the global energy industry;
and the factors set forth under the heading “Risk Factors” on pages 21
through 23 of the company’s 2015 Annual Report on Form 10-K. Other
unpredictable or unknown factors not discussed in this press release
could also have material adverse effects on forward-looking statements.
|
|
|
Attachment 1
|
|
CHEVRON CORPORATION - FINANCIAL REVIEW
|
|
(Millions of Dollars, Except Per-Share Amounts)
|
|
|
|
CONSOLIDATED STATEMENT OF INCOME
|
|
|
(unaudited)
|
|
|
|
Three Months
|
|
|
|
|
|
Ended March 31
|
|
REVENUES AND OTHER INCOME
|
|
|
|
2016
|
|
|
2015
|
|
Sales and other operating revenues *
|
|
|
$
|
23,070
|
|
|
$
|
32,315
|
|
Income from equity affiliates
|
|
|
|
576
|
|
|
|
1,401
|
|
Other income (loss)
|
|
|
|
(93
|
)
|
|
|
842
|
|
Total Revenues and Other Income
|
|
|
|
23,553
|
|
|
|
34,558
|
|
COSTS AND OTHER DEDUCTIONS
|
|
|
|
|
|
|
|
|
Purchased crude oil and products
|
|
|
|
11,225
|
|
|
|
17,193
|
|
Operating, selling, general and administrative expenses
|
|
|
|
6,402
|
|
|
|
6,339
|
|
Exploration expenses
|
|
|
|
370
|
|
|
|
592
|
|
Depreciation, depletion and amortization
|
|
|
|
4,403
|
|
|
|
4,411
|
|
Taxes other than on income *
|
|
|
|
2,864
|
|
|
|
3,118
|
|
Total Costs and Other Deductions
|
|
|
|
25,264
|
|
|
|
31,653
|
|
Income (Loss) Before Income Tax Expense
|
|
|
|
(1,711
|
)
|
|
|
2,905
|
|
Income tax expense (benefit)
|
|
|
|
(1,004
|
)
|
|
|
305
|
|
Net Income (Loss)
|
|
|
|
(707
|
)
|
|
|
2,600
|
|
Less: Net income attributable to noncontrolling interests
|
|
|
|
18
|
|
|
|
33
|
|
NET INCOME (LOSS) ATTRIBUTABLE TO
|
|
|
|
|
|
|
|
|
CHEVRON CORPORATION
|
|
|
$
|
(725
|
)
|
|
$
|
2,567
|
|
|
|
|
|
|
|
|
|
|
PER-SHARE OF COMMON STOCK
|
|
|
|
|
|
|
|
|
Net Income (Loss) Attributable to Chevron Corporation
|
|
|
|
|
|
|
|
|
- Basic
|
|
|
$
|
(0.39
|
)
|
|
$
|
1.38
|
|
- Diluted
|
|
|
$
|
(0.39
|
)
|
|
$
|
1.37
|
|
Dividends
|
|
|
$
|
1.07
|
|
|
$
|
1.07
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Number of Shares Outstanding (000's)
|
|
|
|
|
|
|
|
|
- Basic
|
|
|
|
1,869,775
|
|
|
|
1,866,655
|
|
- Diluted
|
|
|
|
1,869,775
|
|
|
|
1,876,498
|
|
|
|
|
|
|
|
|
|
|
* Includes excise, value-added and similar taxes.
|
|
|
$
|
1,652
|
|
|
$
|
1,877
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Attachment 2
|
|
CHEVRON CORPORATION - FINANCIAL REVIEW
|
|
(Millions of Dollars)
|
|
(unaudited)
|
|
|
|
EARNINGS BY MAJOR OPERATING AREA
|
|
|
|
Three Months
|
|
|
|
|
|
Ended March 31
|
|
|
|
|
|
2016
|
|
|
2015
|
|
Upstream
|
|
|
|
|
|
|
|
|
United States
|
|
|
$
|
(850
|
)
|
|
$
|
(460
|
)
|
|
International
|
|
|
|
(609
|
)
|
|
|
2,020
|
|
|
Total Upstream
|
|
|
|
(1,459
|
)
|
|
|
1,560
|
|
|
Downstream
|
|
|
|
|
|
|
|
|
United States
|
|
|
|
247
|
|
|
|
706
|
|
|
International
|
|
|
|
488
|
|
|
|
717
|
|
|
Total Downstream
|
|
|
|
735
|
|
|
|
1,423
|
|
|
All Other (1)
|
|
|
|
(1
|
)
|
|
|
(416
|
)
|
|
Total (2)
|
|
|
$
|
(725
|
)
|
|
$
|
2,567
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SELECTED BALANCE SHEET ACCOUNT DATA
|
|
|
|
Mar. 31,
2016
|
|
|
Dec. 31,
2015
|
|
Cash and Cash Equivalents
|
|
|
$
|
8,562
|
|
|
$
|
11,022
|
|
|
Marketable Securities
|
|
|
$
|
317
|
|
|
$
|
310
|
|
|
Total Assets (3)
|
|
|
$
|
263,842
|
|
|
$
|
264,540
|
|
|
Total Debt (3)
|
|
|
$
|
42,339
|
|
|
$
|
38,549
|
|
|
Total Chevron Corporation Stockholders' Equity
|
|
|
$
|
150,307
|
|
|
$
|
152,716
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
|
|
|
|
|
|
Ended March 31
|
|
CASH FLOW FROM OPERATIONS
|
|
|
|
2016
|
|
|
2015
|
|
Net Cash Provided by Operating Activities
|
|
|
$
|
1,141
|
|
|
$
|
2,319
|
|
|
Net Increase in Operating Working Capital
|
|
|
$
|
(993
|
)
|
|
$
|
(1,985
|
)
|
|
Net Cash Provided by Operating Activities Excluding Working Capital
|
|
|
$
|
2,134
|
|
|
$
|
4,304
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
|
|
|
|
|
|
Ended March 31
|
|
CAPITAL AND EXPLORATORY EXPENDITURES
(4)
|
|
|
|
2016
|
|
|
2015
|
|
United States
|
|
|
|
|
|
|
|
|
Upstream
|
|
|
$
|
1,276
|
|
|
$
|
2,318
|
|
|
Downstream
|
|
|
|
421
|
|
|
|
285
|
|
|
Other
|
|
|
|
22
|
|
|
|
63
|
|
|
Total United States
|
|
|
|
1,719
|
|
|
|
2,666
|
|
|
|
|
|
|
|
|
|
|
|
International
|
|
|
|
|
|
|
|
|
Upstream
|
|
|
|
4,690
|
|
|
|
5,842
|
|
|
Downstream
|
|
|
|
59
|
|
|
|
75
|
|
|
Other
|
|
|
|
1
|
|
|
|
-
|
|
|
Total International
|
|
|
|
4,750
|
|
|
|
5,917
|
|
|
Worldwide
|
|
|
$
|
6,469
|
|
|
$
|
8,583
|
|
|
|
|
|
|
|
|
|
|
|
(1) Includes worldwide cash management and debt financing
activities, corporate administrative functions, insurance
operations, real estate activities, and technology companies.
|
|
|
|
|
|
|
|
(2) Net Income (Loss) Attributable to Chevron Corporation (See
Attachment 1)
|
|
|
|
|
|
|
|
|
(3) 2015 conforms to 2016 presentation.
|
|
|
|
|
|
|
|
|
(4) Includes interest in affiliates:
|
|
|
|
|
|
|
|
|
United States
|
|
|
$
|
336
|
|
|
$
|
234
|
|
|
International
|
|
|
|
455
|
|
|
|
496
|
|
|
Total
|
|
|
$
|
791
|
|
|
$
|
730
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Attachment 3
|
|
CHEVRON CORPORATION - FINANCIAL REVIEW
|
|
|
|
|
|
|
Three Months
|
|
OPERATING STATISTICS (1)
|
|
|
Ended March 31
|
|
NET LIQUIDS PRODUCTION (MB/D): (2)
|
|
|
2016
|
|
2015
|
|
United States
|
|
|
490
|
|
489
|
|
International
|
|
|
1,291
|
|
1,312
|
|
Worldwide
|
|
|
1,781
|
|
1,801
|
|
|
|
|
|
|
|
|
NET NATURAL GAS PRODUCTION (MMCF/D): (3)
|
|
|
|
|
|
|
United States
|
|
|
1,266
|
|
1,257
|
|
International
|
|
|
4,044
|
|
4,026
|
|
Worldwide
|
|
|
5,310
|
|
5,283
|
|
|
|
|
|
|
|
|
TOTAL NET OIL-EQUIVALENT PRODUCTION (MB/D): (4)
|
|
|
|
|
|
|
United States
|
|
|
701
|
|
699
|
|
International
|
|
|
1,965
|
|
1,982
|
|
Worldwide
|
|
|
2,666
|
|
2,681
|
|
|
|
|
|
|
|
|
SALES OF NATURAL GAS (MMCF/D):
|
|
|
|
|
|
|
United States
|
|
|
3,808
|
|
4,139
|
|
International
|
|
|
4,558
|
|
4,445
|
|
Worldwide
|
|
|
8,366
|
|
8,584
|
|
|
|
|
|
|
|
|
SALES OF NATURAL GAS LIQUIDS (MB/D):
|
|
|
|
|
|
|
United States
|
|
|
129
|
|
128
|
|
International
|
|
|
88
|
|
107
|
|
Worldwide
|
|
|
217
|
|
235
|
|
|
|
|
|
|
|
|
SALES OF REFINED PRODUCTS (MB/D):
|
|
|
|
|
|
|
United States
|
|
|
1,210
|
|
1,206
|
|
International (5)
|
|
|
1,436
|
|
1,580
|
|
Worldwide
|
|
|
2,646
|
|
2,786
|
|
|
|
|
|
|
|
|
REFINERY INPUT (MB/D):
|
|
|
|
|
|
|
United States
|
|
|
957
|
|
918
|
|
International
|
|
|
795
|
|
782
|
|
Worldwide
|
|
|
1,752
|
|
1,700
|
|
|
|
|
|
|
|
|
(1) Includes interest in affiliates.
|
|
|
|
|
|
|
(2) Includes net production of synthetic oil:
|
|
|
|
|
|
|
Canada
|
|
|
49
|
|
51
|
|
Venezuela Affiliate
|
|
|
27
|
|
30
|
|
(3) Includes natural gas consumed in operations (MMCF/D):
|
|
|
|
|
|
|
United States
|
|
|
67
|
|
69
|
|
International
|
|
|
428
|
|
451
|
|
(4) Oil-equivalent production is the sum of net liquids
production, net natural gas production and synthetic production.
The oil-equivalent gas conversion ratio is 6,000 cubic feet of
natural gas = 1 barrel of crude oil.
|
|
|
|
|
|
|
(5) Includes share of affiliate sales (MB/D):
|
|
|
369
|
|
485
|
|
|
|
|
|
|
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20160429005512/en/
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