Canadian Natural Resources Profits Double in First Quarter
Canadian Natural Resources Ltd.’s earnings more than doubled from a year ago in the first quarter. Rising oil prices drove the Calgary-based power company closer to reaching its debt reduction mark.
CNRL stated it made $3.1 billion or $2.63 per diluted share for the quarter concluded March 31, up from $1.38 billion or $1.16 per diluted share in the same quarter last year.
With the conflict in Ukraine driving oil prices to levels not seen in years, CNRL stated it currently anticipates its net debt level to drop below $8 billion in late 2022 or early 2023. The company’s net debt settled at $13.8 billion by the end of the first quarter.
On a teleconference with analysts, chief financial officer Mark Stainthorpe stated, “It obviously depends on your forecast for pricing and lots of other factors that impact the ability to pay down the debt, but we are looking at significant free cash flow through the year.” “I would suggest sometime later this year or early next year.”
CNRL’s board has established $8 billion as a “base level” of corporate debt. The company explains that as soon as that level is hit, additional free capital will be allocated as incremental returns to shareholders.
CNRL (Canada’s biggest oil and gas company by market capitalization) paid roughly $1.8 billion to shareholders in the first quarter of 2022. This included $700 million in dividends and $1.1 billion in share repurchases.
In a research note, eight Capital expert Phil Skolnick stated, “Of note, while we thought it could have been a possibility, the company did not raise its dividend for a third quarter in a row.”
Last year, CNRL indicated that to the degree its net debt is beneath $15 billion, such a quantity would be provided for calculated development and purchase opportunities.
In the first quarter, the company finished a variety of acquisitions, including the remaining 50% interest in the Pike lands in the Jackfish and Kirby areas in northern Alberta and the liquids-rich Montney lands in the Wembley location of northern Alberta.
On the call, CNRL president Tim McKay stated the company plans to contain itself when chasing any future purchases.
“Up to this point, acquisitions have always been a part of our strategy,” McKay stated. “However, we have no gaps in our portfolio and acquisitions need to make sense and add long-term value.”
CNRL reported product sales in the quarter of $12.13 billion, up from $7.02 billion in the first quarter of 2021.
Daily production, before royalties, averaged 1.28 million barrels of oil equivalent each day in the quarter, up from 1.25 million in the same quarter last year.
Adjusted net earnings from operations totaled $2.86 per diluted share, up from $1.03 per diluted share in the first three months of 2021.
Analysts typically had expected an adjusted revenue of $2.54 per share, according to financial markets data firm Refinitiv.
CNRL shares traded at $80.81 on the Toronto Stock Exchange, down $2.81 or 3.4%.
Originally published by: globalnews.ca
