Excluding the $4.5 billion Venezuelan impairment, ConocoPhillips' adjusted earnings amounted to $4.8 billion, or $2.90 a share -- far exceeding the $2.68 a share forecast of analysts surveyed by Thomson Financial.
ConocoPhillips, along with Exxon Mobil Corp., refused to sign deals last month with Venezuela to keep pumping oil in that country's petroleum-rich Orinoco River basin. The company said last month it likely would incur the $4.5 billion charge in the second quarter.COP said a $4.5 billion charge in the second quarter to write off its huge assets in Venezuela sliced net income by 94 percent. The April-June results amounted to net income of $301 million, or 18 cents a share. Without that charge, operating earnings topped Wall Street expectations with the help of higher oil prices and refining margins.
Investors, focusing on operating earnings, drove ConocoPhillips shares up $1.96, or 2.4 percent, to $84.29 Wednesday. The shares have traded in a range of $54.90 to $90.84 in the past year.
In a conference call with analysts Wednesday, ConocoPhillips Chairman Jim Mulva said the company is negotiating with Venezuelan authorities on final compensatory terms for its investment. Earlier this month Mulva said such talks could take several more months.
Analysts have predicted mixed results as the world's biggest integrated oil companies report second-quarter results this week -- higher refining margins offsetting a year-over-year drop in oil prices.
ConocoPhillips said earnings at its exploration and production arm, adjusted for Venezuela, were $2.1 billion, down 36 percent from the second quarter of 2006, when crude oil prices were higher.
The company said it also was hurt by lower sales and higher taxes in the most-recent quarter, factors partially offset by higher natural gas prices.
Production for the quarter averaged 1.9 million barrels of oil equivalent per day, down from 2.1 million barrels a day in the year-ago period. The company attributed the decrease to normal field declines, planned maintenance in the North Sea and its exit from Dubai, among other factors. Production results include ConocoPhillips' Canadian Syncrude operations but not its Russian Lukoil business, which it reports separately.
ConocoPhillips said it anticipates third-quarter production to be lower than the most-recent quarter because of its departure from the Venezuelan oil market, unplanned downtime in Britain because of damage and repairs to a pipeline and planned downtime in the Timor Sea and Alaska.
In a research note, J.P. Morgan Securities said investors may not like the production guidance. It noted that lower production "will weigh on COP's ability to meet production-growth targets."
On the refining and marketing side of the business, ConocoPhillips said its earning rose 38 percent to $2.4 billion from $1.7 billion a year ago, lifted by higher global margins. Gas prices in the U.S. rose to a record $3.227 a gallon in late May.
The company said net income from its 20 percent chunk of Lukoil was $526 million in the second quarter, well above the $387 million it earned a year ago.
As part of its aggressive stock repurchase program, ConocoPhillips said it bought back an additional $1 billion worth of shares in the quarter. The company announced earlier this month it has approved a stock buyback of up to $15 billion through the end of 2008. It expects to repurchase another $2 billion to $3 billion of shares in the current quarter.
The company said it reduced debt by $900 million in the quarter to $22.8 billion.
Bien el gas, bien el refino, bien Lukoil, está el tema de Venezuela que todo lo distorsiona (pero que ya se sabía y que probablemente habrá compensaciones), y no dan buenas previsiones en cuanto a la producción... lo que puede ser bueno para los precios.
Al mercado le han gustado los resultados, y a mí también.
Mente = Inversion, Psique = Especulacion