Chevron Earns $1.1 Billion on Higher Prices
Chevron Corp., the second-largest U.S. oil company, said Wednesday that it earned a record $1.11 billion as surging oil and natural-gas prices lifted first-quarter earnings nearly fourfold.
Separately, Unocal Corp., which explores for oil and natural gas in Thailand, the Gulf of Mexico and Alaska, also benefited from higher oil prices. Profit from continuing operations rose to $130 million, or 52 cents a share, from $17 million, or 6 cents, a year earlier.
For the record:
12:00 a.m. April 28, 2000 For the Record
Los Angeles Times Friday April 28, 2000 Home Edition Business Part C Page 2 Financial Desk 3 inches; 80 words Type of Material: Correction; Wire
Unocal earnings--A Bloomberg News story in Thursday’s Business section incorrectly stated Unocal Corp.’s quarterly earnings. The El Segundo-based oil and natural gas explorer posted a nearly 600% increase in profit from continuing operations in the first quarter ended March 31. Excluding special items, Unocal earned $139 million, or 57 cents per share, compared with $20 million, or 8 cents, a year earlier. The company was expected to earn 55 cents, the average estimate of analysts polled by First Call/Thomson Financial. Estimates ranged from 50 cents to 61 cents.
El Segundo-based Unocal fell short of the 55-cent average estimate of analysts polled by First Call/Thompson Financial. Estimates ranged from 50 cents to 61 cents. Total sales, excluding results from a fertilizer business Unocal sold in January, rose 61% to $1.88 billion from $1.17 billion.
Unocal had $9 million in income from the fertilizer business and special items that resulted in a net charge of $6 million. That made net income $133 million, or 55 cents a share.
In the first quarter of 1999, Unocal had $3 million in earnings from the fertilizer business and special items that resulted in a net charge of $13 million. That made net income $7 million, or 3 cents.
Unocal shares rose 50 cents to close at $30.88 on the New York Stock Exchange.
San Francisco-based Chevron said profit from operations rose to $1.68 a share from $281 million, or 43 cents, a year earlier. Chevron’s highest quarterly earnings previously came in the second quarter of 1997, when it earned $837 million, or $1.27.
Chevron beat the $1.46 average estimate of analysts polled by First Call, and its shares rose $1.50 to close at $86.19 on the NYSE.
U.S. oil prices averaged $28.82 a barrel in the quarter, more than double the year-earlier period. That boosted Chevron sales by 75% to $11.7 billion from $6.69 billion.
Chevron earned $365 million from finding and selling oil and gas in the U.S., up more than tenfold from a year earlier. Outside the U.S., Chevron earned $653 million, up almost sixfold.
Higher oil prices narrowed profit margins on Chevron’s sales of gasoline and other fuels made from oil. Chevron’s refining earnings fell by almost two-thirds to $63 million.
Chevron is projected to earn $1.42 in the second quarter, according to First Call, up from earnings of 73 cents a year earlier. Chevron Chief Executive Dave O’Reilly said the company wants to increase earnings per share by 15% a year.
