ConocoPhillips (NYSE:COP) has posted adjusted earnings per share for the second quarter of 2022 of $3.91, exceeding the $3.78 Zacks Consensus Estimate. The bottom line increased from $1.27 per share in the same quarter last year.
ConocoPhillips, one of the world’s biggest independent oil and gas producers with headquarters in Houston, Texas, saw an increase in quarterly sales to $21,989 million from second-quarter 2021 sales of $10,211 million. In addition, the top line exceeded the $18,019 million Zacks Consensus Estimate.
Higher oil-equivalent production volumes and realized commodity prices have contributed to the outstanding quarterly results.
ConocoPhillips has declared a regular quarterly dividend of $0.46 per share. As of the close of business on August 16, 2022, stockholders of record will receive the dividend on September 1, 2022. A fourth-quarter variable return of cash (VROC) payment of $1.40 per share was also disclosed by ConocoPhilips, representing a 100% increase from the third-quarter VROC.
ConocoPhillips Production, Realized Prices, And Expenses
The total production increased from 1,588 million barrels of oil equivalent per day (MBoe/d) in the same quarter last year to an average of 1,692 MBoe/d. Crude oil accounted for 51.5% of the total output. The significant increase in production in the Lower 48 was the main reason that overall production was higher than the corresponding time a year ago.
The amount of crude oil produced by ConocoPhillips per day increased from the prior quarter’s 849 MBbls/d to 871 MBbls/d. Natural gas liquids were produced at a rate of 244 MBbls/d, up from 128 MBbls/d in the same period last year. Nevertheless, ConocoPhillips’ natural gas production decreased from the 3,260 MMcf/d level in the previous year to 3,107 MMcf/d. Bitumen output for the period was 59 MBbls/d, less than the 68 MBbls/d number for the second quarter of 2021.
Average realized oil equivalent prices increased from $50.03 a year ago to $88.57 per barrel.
The average realized crude oil price for the second quarter was $111.50 per barrel, which is significantly higher than the $65.51 average from the same period last year. The realized price of natural gas liquids was $43.26 per barrel, up from $26.87 in the same quarter last year. For the second quarter of 2022, the average realized natural gas price increased from $4.16 to $10.15 per thousand cubic feet. The average realized bitumen price was $75.42 per barrel, up from $37.60 in the previous year.
Total expenses for ConocoPhillips’ second quarter increased from $7,131 million to $14,334 million over the same period in 2021.
Production and operational costs increased for the reporting quarter from $1,379 million a year earlier to $1,741 million. Similarly, the cost of purchased commodities increased from $2,998 million to $9,234 million for the quarter. Exploration costs soared from $57 million in the same time of 2021 to $143 million for the quarter ending in June 2022.
Balance Sheet & Capital Expenditures
ConocoPhillips had $6,909 million in cash and cash equivalents as of June 30, 2022. The total long-term debt held by the business was $16,295 million. The ratio of debt to capitalization was 0.25. The business had $676 million in short-term debt at the end of the second quarter.
$1,968 million was spent on investments and capital projects, and $988 million was made in dividend payments. Operating activities generated $7,914 million in net cash.
ConocoPhillips 2022 Outlook
According to ConocoPhillips, production will be 1.74 million barrels of oil equivalent per day (MMBoe/d) in 2022. ConocoPhillips anticipates production to range between 1.70 MMBoe/d and 1.76 MMBoe/d for the third quarter of this year.
The company has risen the anticipated 2022 return of capital to shareholders. Compared to the previously announced $10 billion, the revised guidance is $15 billion. Share repurchases and VROC tiers will be used to distribute the incremental returns to stockholders.
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