ConocoPhillips Cuts 2016 Spending Plans, Slashes Dividend -- Update

By Tess Stynes 

ConocoPhillips further reduced its capital-spending plans to $6.4 billion for 2016 and said its board slashed is quarterly dividend, joining a list of major oil companies to get slammed by low oil prices.

Shares fell 4.2% to $37 in recent premarket trading.

The company also reported a fourth-quarter loss of $3.45 billion, or $2.78 a share, as it posted $2.7 billion in asset write-downs to reflect commodities prices and changes in its energy exploration plans. A year earlier, it recorded a loss of $39 million, or three cents a share.

Excluding asset write-downs, asset-sale gains and other items, the adjusted per-share loss was 90 cents, compared with year-earlier adjusted earnings of 60 cents. Revenue slumped 43% to $6.77 billion.

Analysts polled by Thomson Reuters had expected per-share loss of 65 cents and revenue of $9.06 billion.

ConocoPhillips said its board approved cutting the quarterly dividend to 25 cents a share from the previous level of 74 cents a share.

The company, which in December had projected 2016 capital expenditures at $7.7 billion, on Thursday also cut it operating cost estimate to $7 billion from $7.7 billion.

ConocoPhillips said the reduced capital-spending guidance mostly reflects reduced activity in the lower 48 U.S. states.

Chairman and Chief Executive Ryan Lance said in a news release, "While we don't know how far commodity prices will fall, or the duration of the downturn, we believe it's prudent to plan for lower prices for a longer period of time."

"The actions we have announced will improve net cash flow by $4.4 billion in 2016," Mr. Lance stated.

ConocoPhillips said that average selling prices fell 46% from a year earlier, offsetting an increase in production.

The company also has been selling assets and had planned to divest itself of about $2.3 billion in assets in 2015. On Thursday the company said it had completed roughly $2 billion in asset sales last year.

Write to Tess Stynes at [e-mail]

(END) Dow Jones Newswires

February 04, 2016 08:18 ET (13:18 GMT)

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