Chevron Corp. (CVX) - Get Report posted a surprise fourth quarter loss Friday as costs linked to its acquisition of Noble Energy, as well as revenues plunged amid coronavirus-triggered shutdowns for factories around the world.
Chevron said its adjusted loss for the three months ending in December was pegged at 1 cent per share, down from a profit of $1.49 per share over the same period last year and well away from the Street consensus forecast of a 7 cent per share profit. Group revenues, Chevron said, fell 31.2% from last year to $25 billion, again missing analysts' estimates of $26.38 billion tally.
“2020 was a year like no other,” said CEO Mike Wirth. “We were well positioned when the pandemic and economic crisis hit, and we exited the year with a strong balance sheet, having completed a major acquisition and increased our dividend payout for the 33rd consecutive year.”
“When market conditions deteriorated, we swiftly reduced capital spending by 35 percent from 2019 and also reduced operating costs, demonstrating our commitment to capital and cost discipline,” Wirth added. Excluding severance expense, 2020 operating expenses were down $1.4 billion from the prior year," he added. Chevron also completed an enterprise-wide transformation program and the integration of Noble Energy, positioning the company for the future.
Chevron shares were marked 2.7% lower in early trading Friday following the earnings release to change hands at $86.70 each.
Last month, Chevron cut is 2021 capital spending forecast to around $14 billion, including around $300 million in costs linked to the lower carbon transition, as it looks to shift investment away from traditional crude oil markets and into lower carbon alternatives.
That followed news that Chevron would cut around 25% of the workforce at Noble Energy, which it acquired in a $4.1 billion takeover in October, adding to its aim of reducing it global workforce by as much as 15%.