Chesapeake Energy Revenue Falls on Cheaper Energy Prices
February 23 2017 - 8:06AM
Dow Jones News
By Austen Hufford
Chesapeake Energy Corp. said its fourth-quarter loss narrowed
amid lower costs that helped offset a drop in revenue on reduced
production and lower commodities prices.
Still, shares rose 3% to $6.08 in premarket trading as the
results weren't as bad as analysts feared.
Results were hurt by the decrease in commodity prices and lower
production volumes as well as increased unrealized hedging
losses.
In all for the quarter ended Dec. 31, Chesapeake reported a loss
of $741 million, or 84 cents a share, compared with a year-earlier
loss of $2.23 billion, or $3.36 a share. The prior period included
a $2.83 billion impairment charge. Excluding that and and other
items, adjusted per-share earnings were 7 cents, compared with a
year-earlier loss of 19 cents. Revenue dropped 24% to $2.02
billion.
Analysts polled by Thomson Reuters expected per-share earnings
of 7 cents and revenue of $2.08 billion.
With cheaper energy prices, Chesapeake has sharply reduced its
workforce and shrunk its drillable land portfolio.
Production expenses per barrel of oil produced fell 17% as the
average realized oil price fell 26%. Total production decreased
13%.
At the end of 2016, Chesapeake's debt principal balance was
about $10 billion, compared with $9.7 billion at the end of 2015.
So far this year, Chesapeake has reduced its debt principal balance
by about $901 million.
Since Dec. 31, 2015, Chesapeake has cut the principal amount of
debt due in 2017 and 2018 by about 97%, from $2.77 billion to $77
million.
Earlier this month, a federal judge ruled against Chesapeake
bondholders who sued the company for excluding them from a $3.8
billion debt swap they say harmed the value of their debt.
--Ezequiel Minaya contributed to this article.
Write to Austen Hufford at austen.hufford@wsj.com
(END) Dow Jones Newswires
February 23, 2017 08:51 ET (13:51 GMT)
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