Murphy Oil Corp. reported strong preliminary first-quarter financial results on Wednesday, including net income of $58 million, or 34 cents per diluted share of company stock.
The results from the oil production and exploration giant, based in El Dorado, included an adjusted loss of $10 million, or 6 cents per share. The tax expenses were related to a determination that first-quarter earnings from subsidiaries in Canada, Malaysia and Southeast Asia will not be considered reinvested into local operations and instead are expected to be repatriated to the United States in coming months.
Nevertheless, the company rebounded from a fourth-quarter 2016 loss of $64 million and met its guidance predictions for crude production, bringing in an average of 169 million barrel-of-oil equivalents per day while cutting selling and general expenses by about 17 percent from last year.
It also beat expectations with revenue of $544.7 million, although analysts expected the adjusted loss to be less, about 3 cents per share.
Murphy, which had a net loss of $2.27 billion in 2015 and a full-year loss of $276 million in 2016, highlighted a $132 million pre-tax gain by closing its divestiture of Canadian heavy oil assets. It also said its $215 million in capital expenditures fell in line with a planned annual capital budget of $890 million for all of 2017.
Publicly traded Murphy (NYSE: MUR) announced the results after the close of markets. The company’s share price at the end of the day was $25.70.
“Murphy had strong first-quarter results as we exceeded production guidance with high uptime performance across all our assets,” President and CEO Roger Jenkins said in a statement. “Our production is outstanding considering that we brought online fewer wells than planned in our Eagle Ford Shale asset, as our base production and new wells during the quarter both exceeded our expectations. I continue to be pleased with the significant free cash flow generated by our offshore business. We also addressed the tax status regarding future foreign earnings repatriation, which will allow for additional cash management flexibility across our company.”
Earlier Wednesday, Jenkins told an Offshore Technology Conference in Houston that the time is right for deepwater drilling to “come back.” After concluding that 2016 was a rough year for deepwater oil and gas exploration, Jenkins said a “very low point in the cycle” has lasted for more than 30 months, and that “now is the time for deepwater to come back, in my view.”
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