Chevron returns record sum to shareholders, offsetting a big revenue miss

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Chevron Corp.’s stock rose 1.5% early Friday after the oil giant said it returned a record sum to shareholders in 2023, offsetting a decline in profit for the fourth quarter and a revenue shortfall of about $3.7 billion.

The San Ramon, Calif.-based company
CVX,
+0.31%

said it returned $26.3 billion of cash to its shareholders last year between dividends of $11.3 billion and share buybacks of about $14.9 billion. It also announced an 8% increase in its quarterly dividend to $1.63 a share. The new dividend is payable March 11 to shareholders of record as of Feb. 16.

The returns overshadowed fourth-quarter earnings that were hit by impairment charges and a huge revenue miss.

The company posted net income of $2.3 billion, or $1.22 a share, for the quarter, down from $6.4 billion, or $3.33 a share, in the year-earlier period.

The net figure includes $1.8 billion of U.S. upstream impairment charges and $1.9 billion of decommissioning obligations from previously sold assets in the U.S. Gulf of Mexico. The strong dollar shaved about $479 million off earnings.

Adjusted for those items per-share earnings came to $3.45, ahead of the $3.19 FactSet consensus.

Revenue fell to $47.180 billion from $56.473 billion a year ago, below the FactSet consensus of $50.926 billion.

For all of 2023, the company increased worldwide net oil-equivalent production to more than 3.1 million barrels of oil-equivalent a day, with U.S. production growing 14%.

“We also strengthened our portfolio with traditional and new energy acquisitions to help meet the growing demand for affordable, reliable, and ever-cleaner energy,” Chief Executive Mike Wirth said.

Chevron completed several deals in 2023, including PDC Energy, Inc. a majority stake in ACES Delta, LLC, and signed an agreement to acquire Hess Corporation.

Upstream earnings, meaning earnings from activities such as exploration and development, came to $2.259 billion in the quarter, down from $6.526 billion a year ago.

Downstream earnings, or earnings from refining and distribution of finished products, fell to $1.147 billion from $1.683 billion a year ago.

The stock is down 12.5% in the last 12 months, while the S&P 500
SPX,
+1.25%

has gained 17.4%.



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