Equinor Lifts Dividend Despite Swinging to a Loss on Impairments -- Earnings Review

By Dominic Chopping

Equinor ASA (EQNR) reported results for the fourth quarter on Thursday. Here's what we watched:

REVENUE: Revenue fell 31% to $14.9 billion, missing the FactSet analyst consensus of $17.2 billion.

NET INCOME: Equinor posted a net loss of $236 million, from a profit of $3.37 billion a year earlier, as earnings were weighed by lower prices and hefty impairments. Earnings last year were boosted by high oil and gas prices and one-off items. Analysts polled by FactSet had expected net profit of $1.39 billion. Adjusted earnings fell 19% to $3.55 billion against expectations of $3.64 billion.

WHAT WE WATCHED:

PRODUCTION AND PRICES: Equinor delivered total equity production of 2.198 million barrels of oil equivalent a day in the fourth quarter, up from 2.170 million barrels a day the prior year. The increase was mainly due to start-up of new fields on the Norwegian Continental Shelf and in the international exploration and production reporting segment in addition to new wells in the U.S. onshore business, partially offset by expected natural decline, operational challenges and reduced flexible gas production due to lower prices. Lower prices for both liquids and gas impacted the earnings for the quarter, it said.

GUIDANCE: The company expects average annual organic capital expenditure of $10 billion to $11 billion in 2020 and 2021, and around $12 billion for 2022 and 2023. It aims to deliver around 7% growth in production in 2020, and average annual production growth of around 3% from 2019 to 2026. Exploration spending in 2020 is seen at around $1.4 billion. The company also said it targets long term value creation in line with the Paris Agreement. Equinor aims to reach carbon neutral global operations by 2030, by developing as a global offshore wind major and reducing net carbon intensity of energy produced by at least 50% by 2050.

DIVIDEND: Equinor increased its quarterly dividend to $0.27 a share from $0.26, and launched the $675 million second tranche of its share buy-back program.

Write to Dominic Chopping at [e-mail]

(END) Dow Jones Newswires

February 06, 2020 07:11 ET (12:11 GMT)

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