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Murphy Oil Slips on Guidance

The company posts stronger-than-expected third-quarter earnings, but its fourth-quarter forecast is soft.

Murphy Oil

(MUR) - Get Murphy Oil Corporation Report

reported higher-than-anticipated third-quarter earnings amid strength in its refining and marketing operations, but the company gave a fourth-quarter forecast well below Wall Street's expectation.

The oil and gas outfit said third-quarter earnings slid to $222.8 million, or $1.18 a share, from $231 million, or $1.23 a share, a year earlier. Results were hurt by lower earnings in exploration and production, Murphy said.

Still, the earnings beat the company's projection from earlier this month of 95 cents to $1.05 a share. Analysts polled by Thomson First Call had forecast earnings of $1.03 a share.

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Murphy's revenue rose to $4.15 billion from $3.32 billion.

The company's income from exploration and production operations tumbled to $118.8 million in the third quarter from $204.6 million a year earlier. The drop came amid lower oil production volumes, lower natural gas sales prices in North America, higher expenses and increased maintenance costs, Murphy said.

On the other hand, the company's refining and marketing business generated a profit of $126.6 million, up from $32 million a year earlier, as margins improved.

But Murphy said that refining and marketing margins have been much weaker in the early portion of the fourth quarter compared to the last two months of the third quarter. The company projected fourth-quarter earnings of 40 cents to 60 cents a share, sharply below analysts' forecast of 92 cents.

The company's shares were sliding by $1.49, or 2.9%, to $50.60 in after-hours trading.