Key Points
- ConocoPhillips boosts dividend and buybacks following strong Q3 earnings.
- U.S. shale production drives earnings growth despite price drops.
- Production targets raised, acquisition of Marathon Oil expected soon.
ConocoPhillips announced Thursday it is raising both its regular dividend and share buyback program after reporting third-quarter earnings that exceeded expectations. Increased oil and gas production, especially from U.S. shale, contributed to the results.
ConocoPhillips raises dividend as Q3 production beats estimates
The U.S.-based energy producer reported adjusted earnings per share of $1.78 for Q3, down from $2.16 a year ago but above the $1.65 analyst estimate compiled by The Wall Street Journal.
Higher production volumes helped ConocoPhillips offset a dip in oil and gas prices compared to last year. The company’s average realized price for oil equivalent fell to $54.18 per barrel, 10% lower than the $60.05 per barrel it achieved in Q3 2023.
Oilprice explains that for Q3 2024, ConocoPhillips’s production averaged 1.917 million barrels of oil equivalent per day (boed), up 3% from the previous year when adjusted for acquisitions and disposals. Record production was achieved in the Lower 48 states, totaling 1.147 million boed, including 781,000 boed from the Permian, 246,000 boed from Eagle Ford, and 107,000 boed from Bakken.
Company ups Q4 and full-year production guidance for 2024
The company projects Q4 2024 production to range from 1.99 million to 2.03 million boed. Full-year production guidance was increased to 1.94 million-1.95 million boed, up from the prior estimate of 1.93 million-1.94 million boed.
ConocoPhillips’s board approved a 34% increase in the regular dividend, bringing it to $0.78 per share, and expanded the share repurchase authorization by up to $20 billion. The company expects to distribute at least $9 billion to shareholders in 2024, said Chairman and CEO Ryan Lance.
The company also expects to close its planned acquisition of Marathon Oil this quarter and anticipates surpassing its initial synergy target of $500 million, according to Lance.
Following the announcement, ConocoPhillips shares rose 3% in pre-market trading in New York.
