- Fourth quarter net income of $813 million with cash flow from
operating activities of $1,632 million and free cash flow¹ of
$1,233 million
- Highest annual Upstream production in over 30 years,
underpinned by record annual Kearl production and continued strong
production performance at Cold Lake
- Continued fuel demand recovery with full-year Downstream
refinery capacity utilization of 89 percent
- Highest full-year Chemical earnings in over 30 years
- Record shareholder returns of nearly $3 billion in 2021 through
dividend payments and share repurchases under the company’s normal
course issuer bid program
- Quarterly dividend increased by 26 percent from 27 cents to 34
cents per share
- Announced plans for 2030 oil sands greenhouse gas emission
intensity reduction in support of its goal to achieve net zero
emissions in its operated oil sands assets by 2050
Imperial Oil Limited (TSE: IMO, NYSE American: IMO):
This press release features multimedia. View
the full release here:
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Upstream fourth quarter net income (loss)
factor analysis (Graphic: Business Wire)
Fourth quarter
Twelve months
millions of Canadian dollars, unless
noted
2021
2020
∆
2021
2020
∆
Net income (loss) (U.S. GAAP)
813
(1,146)
+1,959
2,479
(1,857)
+4,336
Net income (loss) per common share,
assuming dilution (dollars)
1.18
(1.56)
+2.74
3.48
(2.53)
+6.01
Capital and exploration expenditures
441
195
+246
1,140
874
+266
Imperial reported estimated net income in the fourth quarter of
$813 million and cash flow from operating activities of $1,632
million, down from net income of $908 million and cash flow from
operating activities of $1,947 million in the third quarter of
2021. Fourth quarter results reflect continued strong operating
performance and commodity prices, partly offset by extreme cold
weather impacts on the company’s oil sands mining operations in
December, and a number of unrelated one-time earnings charges of
approximately $160 million. There are no material current or future
cash impacts associated with these one-time charges. Full-year
estimated net income was $2,479 million, the highest since 2014,
with cash flow from operating activities of $5,476 million.
“This past year demonstrated the strength of Imperial’s
integrated business model and the value we have created through
structural cost reductions, relentless focus on reliable operations
and capital-efficient growth in our core businesses,” said Brad
Corson, chairman, president and chief executive officer.
Upstream production in the fourth quarter averaged 445,000 gross
oil-equivalent barrels per day, bringing annual production to
428,000 gross oil-equivalent barrels per day, the highest annual
production in over 30 years. At Kearl, quarterly total gross
production averaged 270,000 barrels per day with operations
impacted by extreme cold weather in the month of December. On a
yearly basis, Kearl’s total gross production of 263,000 barrels per
day established a new annual production record, exceeding the
previous record by 41,000 barrels per day. At Cold Lake, quarterly
production averaged 142,000 barrels per day with annual production
of 140,000 barrels per day, driven by the continued focus on
production optimization and reliability enhancements.
¹ non-GAAP financial measure - see
Attachment VI for definition and reconciliation
In the Downstream, throughput in the fourth quarter continued to
increase, averaging 416,000 barrels per day. Capacity utilization
was 97 percent, a further three percent improvement over the third
quarter of 2021. Petroleum product sales in the quarter averaged
496,000 barrels per day, reflecting continued recovery in demand
for fuel products. Full-year throughput averaged 379,000 barrels
per day with capacity utilization of 89 percent and petroleum
product sales of 456,000 barrels per day.
Chemical fourth quarter net income was $64 million with
full-year net income of $361 million, the highest full-year net
income in over 30 years. Chemical results continue to be driven by
strength in polyethylene margins and strong operating
performance.
During the quarter, Imperial returned $949 million to
shareholders through dividend payments and share repurchasing, with
full-year shareholder returns of nearly $3 billion, the highest in
company history. Further enhancing returns for shareholders, in
November the company announced plans to accelerate share
repurchasing under its normal course issuer bid program, and
purchases of the remainder of the shares available under the
program were completed by January 31, 2022. The company also
declared a first quarter dividend increase of 26 percent to 34
cents per share.
“Imperial generated about $5.5 billion in cash flow from
operating activities with about $4.5 billion in free-cash flow¹ in
2021 and the company is committed to returning cash to
shareholders, as demonstrated by our record distributions this past
year,” said Corson. “Following the completion of our accelerated
normal course issuer bid in January and the sizable dividend
increase we announced earlier today, Imperial is actively
evaluating options for further shareholder distributions.”
Subsequent to the quarter, Imperial announced plans for further
reductions in greenhouse gas emissions intensity over the next
decade to help support Canada’s net zero goals. By the end of 2030,
Imperial anticipates reducing Scope 1 and 2 greenhouse gas
emissions intensity at its operated oil sands facilities by 30
percent, compared with 2016 levels. “I’m proud of the progress
we’ve made to-date in reducing the intensity of our greenhouse gas
emissions at our operated oil sands assets and our recent
announcement is another big step in our journey to net zero at our
operated oil sands assets by 2050,” said Corson. “As a founding
member of the Oil Sands Pathways to Net Zero alliance, we will
continue to collaborate to advance lower-emission solutions.”
Fourth quarter highlights
- Net income of $813 million or $1.18 per share on a diluted
basis, compared to a net loss of $1,146 million or $1.56 per
share in the fourth quarter of 2020. Net income excluding
identified items¹ of $813 million in the fourth quarter of 2021, up
from $25 million in the same period of 2020.
- Cash flows from operating activities of $1,632 million,
up from $316 million in the same period of 2020. Cash flows from
operating activities excluding working capital¹ of $1,648 million,
up from $564 million in the same period of 2020.
- Capital and exploration expenditures totalled $441
million, up from $195 million in the fourth quarter of 2020.
Full-year capital and exploration expenditures totalled $1,140
million, as the company progressed a number of key projects
including Kearl in-pit tailings infrastructure and the replacement
of the Sarnia products pipeline.
- The company returned $949 million to shareholders in the
fourth quarter of 2021, including $761 million in accelerated
share repurchases and $188 million in dividends paid.
- Production averaged 445,000 gross oil-equivalent barrels per
day, compared to 460,000 barrels per day in the same period of
2020. Decreased production was primarily driven by impacts from
extreme cold weather in December 2021.
- Total gross bitumen production at Kearl averaged 270,000
barrels per day (191,000 barrels Imperial's share), compared to
284,000 barrels per day (202,000 barrels Imperial's share) in the
fourth quarter of 2020. Total gross production was impacted by
13,000 barrels per day (9,000 barrels Imperial's share) as a result
of extreme cold weather in December 2021.
- Gross bitumen production at Cold Lake averaged 142,000
barrels per day, up from 136,000 barrels per day in the fourth
quarter of 2020. Higher production was supported by continued
production optimization and reliability enhancements.
- The company's share of gross production from Syncrude
averaged 79,000 barrels per day, compared to 87,000 barrels per
day in the fourth quarter of 2020. Production was impacted by
unscheduled downtime and extreme cold weather in December
2021.
- Refinery throughput averaged 416,000 barrels per day, up
from 359,000 barrels per day in the fourth quarter of 2020.
Capacity utilization was 97 percent, up from 85 percent in the
fourth quarter of 2020. Higher throughput was primarily driven by
increased demand.
- Petroleum product sales were 496,000 barrels per day, up
from 416,000 barrels per day in the fourth quarter of 2020. Higher
petroleum product sales were primarily driven by increased
demand.
- Chemical net income of $64 million in the quarter, up
from $23 million in the fourth quarter of 2020. Improved results
were driven by continued strength in polyethylene margins and
strong operating performance.
- In January, announced intention to market interests in XTO
Energy Canada jointly with ExxonMobil Canada, consistent with
Imperial’s strategy to focus Upstream resources on key oil sands
assets. A definitive decision to sell the assets has not been
made.
- In January, announced plans for further GHG emissions
intensity reductions at the company’s operated oil sands
facilities, anticipating a 30 percent reduction by 2030
compared to 2016 levels in support of the company's goal to achieve
net zero emissions in its operated oil sands assets by 2050.
Current Business Environment
In early 2020, the balance of supply and demand for petroleum
and petrochemical products experienced two significant disruptive
effects. On the demand side, the COVID-19 pandemic spread rapidly
through most areas of the world resulting in substantial reductions
in consumer and business activity and significantly reduced demand
for crude oil, natural gas, and petroleum products. This reduction
in demand coincided with announcements of increased production in
certain key oil-producing countries which led to increases in
inventory levels and sharp declines in prices for crude oil,
natural gas, and petroleum products.
Through 2021, demand for petroleum and petrochemical products
has continued to recover, with the company’s financial results
benefiting from stronger prices and margins. The company continues
to closely monitor industry and global economic conditions,
including recovery from the COVID-19 pandemic.
The general rate of inflation in Canada and many other countries
has seen an increase over the past year. Prices for services and
materials continue to evolve in response to constant changes in
commodity markets and industry activities, impacting operating and
capital costs. Generally the company tries to mitigate those
impacts by cost reductions from efficiency and productivity
improvements.
Operating Results Fourth quarter 2021 vs. fourth quarter
2020
Fourth Quarter
millions of Canadian dollars, unless
noted
2021
2020
Net income (loss) (U.S. GAAP)
813
(1,146)
Net income (loss) per common share,
assuming dilution (dollars)
1.18
(1.56)
Net income (loss) excluding identified
items (a)
813
25
(a) non-GAAP financial measure - see
Attachment VI for definition and reconciliation
The company recorded net income of $813
million or $1.18 per share on a diluted basis in the fourth quarter
of 2021, compared to a net loss of $1,146 million or $1.56 per
share on a diluted basis in the fourth quarter of 2020. Prior year
results included unfavourable identified items¹ of $1,171 million
related to the company's decision to no longer develop a
significant portion of its unconventional portfolio.
Upstream Net income (loss) factor analysis millions of
Canadian dollars
Price – Higher realizations increased net income by about $1,090
million, primarily driven by average bitumen realizations
increasing by $31.34 per barrel and synthetic realizations
increasing by $41.26 per barrel.
Volumes – Lower volumes primarily driven by extreme cold weather
at Kearl and Syncrude and unplanned downtime at Syncrude decreased
net income by about $80 million.
Royalty – Higher royalties decreased net income by about $180
million, primarily driven by higher commodity prices.
Identified items1 – Prior year results included unfavourable
identified items¹ of $1,171 million related to the company's
decision to no longer develop a significant portion of its
unconventional portfolio.
Other – All other items decreased net income by $264 million,
primarily driven by higher operating expenses of about $230 million
and unfavourable foreign exchange impacts of about $50 million.
Average realizations and marker
prices
Fourth Quarter
Canadian dollars, unless noted
2021
2020
West Texas Intermediate (US$)
77.04
42.70
Western Canada Select (US$)
62.49
33.35
WTI/WCS Spread (US$)
14.55
9.35
Bitumen (per barrel)
65.53
34.19
Synthetic oil (per barrel)
92.54
51.28
Average foreign exchange rate (US$)
0.79
0.77
Imperial’s average Canadian dollar realizations for bitumen
increased in the quarter, generally in line with WCS. The company’s
average Canadian dollar realizations for synthetic crude increased
generally in line with WTI, adjusted for changes in exchange rates
and transportation costs.
Production
Fourth Quarter
thousands of barrels per day
2021
2020
Kearl (Imperial's share)
191
202
Cold Lake
142
136
Syncrude (Imperial's share)
79
87
Kearl total gross production (thousands of
barrels per day)
270
284
Lower production at Kearl was primarily as
a result of extreme cold weather in December of 2021.
Lower production at Syncrude was primarily
driven by unscheduled downtime and extreme cold weather in December
of 2021.
Downstream Net income (loss) factor analysis millions of
Canadian dollars
Margins – Higher margins increased net income by about $260
million, reflecting improved product demand.
Other – All other items reduced net income by $116 million,
which included an unfavourable out-of-period inventory adjustment
of $60 million2.
Refinery utilization and petroleum
product sales
Fourth Quarter
thousands of barrels per day, unless
noted
2021
2020
Refinery throughput
416
359
Refinery capacity utilization
(percent)
97
85
Petroleum product sales
496
416
Improved refinery throughput in the fourth quarter of 2021
primarily reflects increased demand.
Improved petroleum product sales in the fourth quarter of 2021
primarily reflects increased demand.
2 In the fourth quarter, the company
recorded an unfavourable $60 million out-of-period inventory
adjustment. The inventory adjustment related to reconciliations of
additives at third-party terminals and products inventory at equity
and third-party terminals which have been resolved.
Chemicals Net income (loss) factor analysis millions of
Canadian dollars
Margins – Improved margins increased net income by about $60
million, primarily due to stronger industry polyethylene
margins.
Corporate and other
Fourth Quarter
millions of Canadian dollars
2021
2020
Net income (loss) (U.S. GAAP)
(46)
(83)
Liquidity and capital resources
Fourth Quarter
millions of Canadian dollars
2021
2020
Cash flow generated from (used in):
Operating activities
1,632
316
Investing activities
(399)
(197)
Financing activities
(955)
(165)
Increase (decrease) in cash and cash
equivalents
278
(46)
Cash flow generated from operating activities primarily reflects
higher Upstream realizations and stronger Downstream margins.
Fourth Quarter
millions of Canadian dollars, unless
noted
2021
2020
Dividends paid
188
161
Per share dividend paid (dollars)
0.27
0.22
Share repurchases (a)
761
-
Number of shares purchased (millions) (a)
(b)
17.5
-
(a) The company did not purchase shares
during the fourth quarter of 2020, except for limited purchases to
eliminate dilution in conjunction with its restricted stock unit
plan
(b) Share repurchases were made under the
company’s normal course issuer bid program, and include shares
purchased from Exxon Mobil Corporation concurrent with, but outside
of the normal course issuer bid.
The company’s cash balance was $2,153 million at December 31,
2021, versus $771 million at the end of fourth quarter 2020.
Full-year 2021 vs. full-year 2020
Twelve Months
millions of Canadian dollars, unless
noted
2021
2020
Net income (loss) (U.S. GAAP)
2,479
(1,857)
Net income (loss) per common share,
assuming dilution (dollars)
3.48
(2.53)
Net income (loss) excluding identified
items (a)
2,479
(686)
(a) non-GAAP financial measure - see
Attachment VI for definition and reconciliation
The company recorded net income of $2,479
million or $3.48 per share on a diluted basis in 2021, compared to
a net loss of $1,857 million or $2.53 per share in 2020. Prior year
results included unfavourable identified items¹ of $1,171 million
related to the company's decision to no longer develop a
significant portion of its unconventional portfolio.
Upstream Net income (loss) factor analysis millions of
Canadian dollars
Price – Higher realizations increased net income by about $3,640
million, primarily driven by average bitumen realizations
increasing by $32.22 per barrel and synthetic realizations
increasing by $31.85 per barrel.
Volumes – Higher volumes primarily driven by the absence of
production balancing with market demands increased net income by
about $550 million.
Royalty – Higher royalties decreased net income by about $680
million, primarily driven by higher commodity prices.
Identified items1 – Prior year results included unfavourable
identified items¹ of $1,171 million related to the company's
decision to no longer develop a significant portion of its
unconventional portfolio.
Other – All other items decreased net income by $968 million,
primarily driven by higher operating expenses of about $720
million, unfavourable foreign exchange impacts of about $230
million and lower Canada Emergency Wage Subsidy received by the
company compared to prior year of about $60 million, which includes
Imperial's proportionate share of a joint venture.
Average realizations and marker
prices
Twelve Months
Canadian dollars, unless noted
2021
2020
West Texas Intermediate (US$)
68.05
39.26
Western Canada Select (US$)
54.96
26.87
WTI/WCS Spread (US$)
13.09
12.39
Bitumen (per barrel)
57.91
25.69
Synthetic oil (per barrel)
81.61
49.76
Average foreign exchange rate (US$)
0.80
0.75
Imperial’s average Canadian dollar realizations for bitumen
increased in 2021, generally in line with WCS. The company’s
average Canadian dollar realizations for synthetic crude increased
generally in line with WTI, adjusted for changes in exchange rates
and transportation costs.
¹ non-GAAP financial measure - see
Attachment VI for definition and reconciliation
Production
Twelve Months
thousands of barrels per day
2021
2020
Kearl (Imperial's share)
186
158
Cold Lake
140
132
Syncrude (Imperial's share)
71
69
Kearl total gross production (thousands of
barrels per day)
263
222
Higher production at Kearl was primarily
driven by the absence of prior year production balancing with
market demands.
Downstream Net income (loss) factor analysis millions of
Canadian dollars
Margins – Higher margins increased net income by about $600
million, reflecting improved product demand.
Other – All other items decreased net income by $258 million,
primarily driven by unfavourable foreign exchange impacts of about
$150 million and an unfavourable out-of-period inventory adjustment
of $74 million3, partially offset by lower operating expenses of
about $50 million.
Refinery utilization and petroleum
product sales
Twelve Months
thousands of barrels per day, unless
noted
2021
2020
Refinery throughput
379
340
Refinery capacity utilization
(percent)
89
80
Petroleum product sales
456
421
Improved refinery throughput in 2021 primarily reflects reduced
impacts associated with the COVID-19 pandemic, partially offset by
a planned turnaround at Strathcona.
Improved petroleum product sales in 2021 primarily reflects
reduced impacts associated with the COVID-19 pandemic.
3 In 2021, the company recorded an
unfavourable $74 million out-of-period inventory adjustment. The
inventory adjustment related to reconciliations of additives and
products inventory at equity and third-party terminals which have
been resolved.
Chemicals Net income (loss) factor analysis millions of
Canadian dollars
Margins – Improved margins increased net income by about $250
million, primarily due to stronger industry polyethylene
margins.
Corporate and other
Twelve Months
millions of Canadian dollars
2021
2020
Net income (loss) (U.S. GAAP)
(172)
(170)
Liquidity and capital resources
Twelve Months
millions of Canadian dollars
2021
2020
Cash flow generated from (used in):
Operating activities
5,476
798
Investing activities
(1,012)
(802)
Financing activities
(3,082)
(943)
Increase (decrease) in cash and cash
equivalents
1,382
(947)
Cash flow generated from operating activities primarily reflects
higher Upstream realizations and stronger Downstream margins.
Twelve Months
millions of Canadian dollars, unless
noted
2021
2020
Dividends paid
706
649
Per share dividend paid (dollars)
0.98
0.88
Share repurchases
2,245
274
Number of shares purchased (millions)
(a)
56.0
9.8
(a) Share repurchases were made under the
company’s normal course issuer bid program, and include shares
purchased from Exxon Mobil Corporation concurrent with, but outside
of the normal course issuer bid.
At March 31, 2021, due to the termination of transportation
services agreements related to a third-party pipeline project, the
company recognized a liability of $62 million, previously reported
as a contingent liability in Note 10 of Imperial’s Form 10-K. In
connection with the same project, commitments under “Other
long-term purchase agreements” as reported in Imperial’s Form 10-K
decreased by approximately $2.9 billion. The majority of these
commitments related to years 2026 and beyond.
Key financial and operating data follow.
Forward-looking statements
Statements of future events or conditions in this report,
including projections, targets, expectations, estimates, and
business plans are forward-looking statements. Forward-looking
statements can be identified by words such as believe, anticipate,
intend, propose, plan, goal, seek, project, predict, target,
estimate, expect, strategy, outlook, schedule, future, continue,
likely, may, should, will and similar references to future periods.
Forward-looking statements in this report include, but are not
limited to, references to plans for 2030 oil sands greenhouse gas
emission intensity reduction in support of its goal to achieve net
zero emissions in its operated oil sands assets by 2050; the
company’s commitment to returning cash to shareholders, including
actively evaluating options for further shareholder distributions;
continuing to collaborate and invest in opportunities to advance
lower-emission solutions, including through the Oil Sands Pathways
to Net Zero alliance; the company’s intention to market interests
in XTO Energy Canada; closely monitoring industry and economic
conditions and the effects from the COVID-19 pandemic; and constant
changes in prices for services and materials, its impact on
operating and capital costs, and the company’s ability to mitigate
those impacts through efficiency and productivity improvements.
Forward-looking statements are based on the company's current
expectations, estimates, projections and assumptions at the time
the statements are made. Actual future financial and operating
results, including expectations and assumptions concerning demand
growth and energy source, supply and mix; production rates, growth
and mix across various assets; project plans, timing, costs,
technical evaluations and capacities and the company’s ability to
effectively execute on these plans and operate its assets; the
adoption and impact of new facilities or technologies on reductions
to GHG emissions intensity, including but not limited to next
generation technologies using solvents to replace energy intensive
steam at Cold Lake, boiler flue gas technology at Kearl, and
support for and advancement of carbon capture and storage, and any
changes in the scope, terms, or costs of such projects; the amount
and timing of emissions reductions; support from policymakers and
other stakeholders for various new technologies such as carbon
capture and storage; applicable laws and government policies,
including with respect to climate change and GHG emissions
reductions; for shareholder returns, assumptions such as cash flow
forecasts, financing sources and capital structure, regulatory
approvals, participation of the company’s majority shareholder and
the results of periodic and ongoing evaluation of alternate uses of
capital; applicable laws and government policies, including
restrictions in response to COVID-19; receipt of regulatory
approvals; capital and environmental expenditures; progression of
COVID-19 and its impacts on Imperial’s ability to operate its
assets, including the possible shutdown of facilities due to
COVID-19 outbreaks; the company’s ability to effectively execute on
its business continuity plans and pandemic response activities; and
commodity prices, foreign exchange rates and general market
conditions could differ materially depending on a number of
factors.
These factors include global, regional or local changes in
supply and demand for oil, natural gas, and petroleum and
petrochemical products and resulting price, differential and margin
impacts, including foreign government action with respect to supply
levels and prices and the impact of COVID-19 on demand;
availability and allocation of capital; political or regulatory
events, including changes in law or government policy,
environmental regulation including climate change and greenhouse
gas regulation, and actions in response to COVID-19; the results of
research programs and new technologies, the ability to bring new
technologies to commercial scale on a cost-competitive basis, and
the competitiveness of alternative energy and other emission
reduction technologies; lack of required support from governments
and policymakers for adoption of new technologies for emissions
reductions; unanticipated technical or operational difficulties;
project management and schedules and timely completion of projects;
availability and performance of third-party service providers,
including in light of restrictions related to COVID-19;
environmental risks inherent in oil and gas exploration and
production activities; the receipt, in a timely manner, of
regulatory and third-party approvals; management effectiveness and
disaster response preparedness, including business continuity plans
in response to COVID-19; operational hazards and risks;
cybersecurity incidents, including increased reliance on remote
working arrangements and activation of business continuity plans
due to COVID-19; currency exchange rates; general economic
conditions; and other factors discussed in Item 1A risk factors and
Item 7 management’s discussion and analysis of financial condition
and results of operations of Imperial Oil Limited’s most recent
annual report on Form 10-K and subsequent interim reports.
Forward-looking statements are not guarantees of future
performance and involve a number of risks and uncertainties, some
that are similar to other oil and gas companies and some that are
unique to Imperial Oil Limited. Imperial’s actual results may
differ materially from those expressed or implied by its
forward-looking statements and readers are cautioned not to place
undue reliance on them. Imperial undertakes no obligation to update
any forward-looking statements contained herein, except as required
by applicable law.
In this release all dollar amounts are expressed in Canadian
dollars unless otherwise stated. This release should be read in
conjunction with Imperial’s most recent Form 10-K. Note that
numbers may not add due to rounding.
The term “project” as used in this release can refer to a
variety of different activities and does not necessarily have the
same meaning as in any government payment transparency reports.
Attachment I
Fourth Quarter
Twelve Months
millions of Canadian dollars, unless
noted
2021
2020
2021
2020
Net Income (loss) (U.S. GAAP)
Total revenues and other income
12,312
6,033
37,590
22,388
Total expenses
11,201
7,496
34,307
24,796
Income (loss) before income taxes
1,111
(1,463)
3,283
(2,408)
Income taxes
298
(317)
804
(551)
Net income (loss)
813
(1,146)
2,479
(1,857)
Net income (loss) per common share
(dollars)
1.18
(1.56)
3.48
(2.53)
Net income (loss) per common share -
assuming dilution (dollars)
1.18
(1.56)
3.48
(2.53)
Other Financial Data
Gain (loss) on asset sales, after tax
9
7
43
32
Total assets at December 31
40,592
38,031
Total debt at December 31
5,176
5,184
Shareholders' equity at December 31
21,735
21,418
Capital employed at December 31
26,931
26,628
Dividends declared on common stock
Total
185
162
729
647
Per common share (dollars)
0.27
0.22
1.03
0.88
Millions of common shares outstanding
At December 31
678.1
734.1
Average - assuming dilution
689.5
734.1
713.2
735.3
Attachment II
Fourth Quarter
Twelve Months
millions of Canadian dollars
2021
2020
2021
2020
Total cash and cash equivalents at
period end
2,153
771
2,153
771
Operating Activities
Net income (loss)
813
(1,146)
2,479
(1,857)
Adjustments for non-cash items:
Depreciation and depletion
545
1,998
1,977
3,273
Impairment of intangible assets
-
-
-
20
(Gain) loss on asset sales
(10)
(7)
(49)
(35)
Deferred income taxes and other
75
(311)
91
(521)
Changes in operating assets and
liabilities
(16)
(248)
363
(335)
All other items - net
225
30
615
253
Cash flows from (used in) operating
activities
1,632
316
5,476
798
Investing Activities
Additions to property, plant and
equipment
(424)
(211)
(1,108)
(868)
Proceeds from asset sales
24
14
81
82
Loans to equity companies - net
1
-
15
(16)
Cash flows from (used in) investing
activities
(399)
(197)
(1,012)
(802)
Cash flows from (used in) financing
activities
(955)
(165)
(3,082)
(943)
Attachment III
Fourth Quarter
Twelve Months
millions of Canadian dollars
2021
2020
2021
2020
Net income (loss) (U.S. GAAP)
Upstream
545
(1,192)
1,395
(2,318)
Downstream
250
106
895
553
Chemical
64
23
361
78
Corporate and other
(46)
(83)
(172)
(170)
Net income (loss)
813
(1,146)
2,479
(1,857)
Revenues and other income
Upstream
4,252
2,940
15,831
8,797
Downstream
14,453
4,213
34,786
16,736
Chemical
449
281
1,758
1,008
Eliminations / Corporate and other
(6,842)
(1,401)
(14,785)
(4,153)
Revenues and other income
12,312
6,033
37,590
22,388
Purchases of crude oil and
products
Upstream
1,712
1,496
7,492
4,834
Downstream
12,980
3,060
29,505
12,047
Chemical
273
163
966
579
Eliminations
(6,843)
(1,401)
(14,789)
(4,167)
Purchases of crude oil and products
8,122
3,318
23,174
13,293
Production and manufacturing
Upstream
1,266
997
4,661
3,852
Downstream
406
382
1,445
1,468
Chemical
65
58
210
215
Eliminations
-
-
-
-
Production and manufacturing
1,737
1,437
6,316
5,535
Selling and general
Upstream
-
-
-
-
Downstream
156
163
572
619
Chemical
22
23
90
92
Eliminations / Corporate and other
37
56
122
30
Selling and general
215
242
784
741
Capital and exploration
expenditures
Upstream
266
107
632
561
Downstream
168
74
476
251
Chemical
2
6
8
21
Corporate and other
5
8
24
41
Capital and exploration expenditures
441
195
1,140
874
Exploration expenses charged to Upstream
income included above
26
7
32
13
Attachment IV
Operating statistics
Fourth Quarter
Twelve Months
2021
2020
2021
2020
Gross crude oil and natural gas liquids
(NGL) production
(thousands of barrels per day)
Kearl
191
202
186
158
Cold Lake
142
136
140
132
Syncrude
79
87
71
69
Conventional
11
10
10
11
Total crude oil production
423
435
407
370
NGLs available for sale
2
2
1
2
Total crude oil and NGL production
425
437
408
372
Gross natural gas production
(millions of cubic feet per day)
121
140
120
154
Gross oil-equivalent production
(a)
445
460
428
398
(thousands of oil-equivalent barrels per
day)
Net crude oil and NGL production
(thousands of barrels per day)
Kearl
179
199
178
155
Cold Lake
119
120
114
124
Syncrude
68
82
62
68
Conventional
11
14
9
10
Total crude oil production
377
415
363
357
NGLs available for sale
1
2
1
2
Total crude oil and NGL production
378
417
364
359
Net natural gas production
(millions of cubic feet per day)
112
136
115
150
Net oil-equivalent production
(a)
397
440
383
384
(thousands of oil-equivalent barrels per
day)
Kearl blend sales (thousands of
barrels per day)
272
278
264
222
Cold Lake blend sales (thousands of
barrels per day)
189
184
187
179
NGL sales (thousands of barrels per
day) (b)
-
1
-
2
Average realizations (Canadian
dollars)
Bitumen (per barrel)
65.53
34.19
57.91
25.69
Synthetic oil (per barrel)
92.54
51.28
81.61
49.76
Conventional crude oil (per barrel)
70.09
27.21
59.84
29.34
NGL (per barrel)
62.07
19.03
35.87
13.85
Natural gas (per thousand cubic feet)
4.92
2.25
3.83
1.90
Refinery throughput (thousands of
barrels per day)
416
359
379
340
Refinery capacity utilization
(percent)
97
85
89
80
Petroleum product sales (thousands
of barrels per day)
Gasolines
240
211
224
215
Heating, diesel and jet fuels
180
144
160
146
Heavy fuel oils
32
21
27
20
Lube oils and other products
44
40
45
40
Net petroleum products sales
496
416
456
421
Petrochemical sales (thousands of
tonnes)
194
176
831
749
(a)
Gas converted to oil-equivalent at six
million cubic feet per one thousand barrels.
(b)
Fourth quarter and twelve months 2021 NGL
sales round to 0.
Attachment V
Net income (loss) per
Net income (loss) (U.S. GAAP)
common share - diluted (a)
millions of Canadian dollars
Canadian dollars
2017
First Quarter
333
0.39
Second Quarter
(77)
(0.09)
Third Quarter
371
0.44
Fourth Quarter
(137)
(0.16)
Year
490
0.58
2018
First Quarter
516
0.62
Second Quarter
196
0.24
Third Quarter
749
0.94
Fourth Quarter
853
1.08
Year
2,314
2.86
2019
First Quarter
293
0.38
Second Quarter
1,212
1.57
Third Quarter
424
0.56
Fourth Quarter
271
0.36
Year
2,200
2.88
2020
First Quarter
(188)
(0.25)
Second Quarter
(526)
(0.72)
Third Quarter
3
-
Fourth Quarter
(1,146)
(1.56)
Year
(1,857)
(2.53)
2021
First Quarter
392
0.53
Second Quarter
366
0.50
Third Quarter
908
1.29
Fourth Quarter
813
1.18
Year
2,479
3.48
(a)
Computed using the average number of
shares outstanding during each period. The sum of the quarters
presented may not add to the year total.
Attachment VI
Non-GAAP financial measures and other specified financial
measures
Certain measures included in this document are not prescribed by
U.S. Generally Accepted Accounting Principles (GAAP). These
measures constitute “non-GAAP financial measures” under Securities
and Exchange Commission Regulation G, and “specified financial
measures” under National Instrument 52-112 Non-GAAP and Other
Financial Measures Disclosure of the Canadian Securities
Administrators.
Reconciliation of these non-GAAP financial measures to the most
comparable GAAP measure, and other information required by these
regulations have been provided. Non-GAAP financial measures and
specified financial measures are not standardized financial
measures under GAAP and do not have a standardized definition. As
such, these measures may not be directly comparable to measures
presented by other companies, and should not be considered a
substitute for GAAP financial measures.
Cash flows from (used in) operating activities excluding
working capital
Cash flows from (used in) operating activities excluding working
capital is a non-GAAP financial measure that is the total cash
flows from operating activities less the changes in operating
assets and liabilities in the period. The most directly comparable
financial measure that is disclosed in the financial statements is
cash flows from (used in) operating activities within the company’s
Consolidated statement of cash flows. Management believes it is
useful for investors to consider these numbers in comparing the
underlying performance of the company’s business across periods
when there are significant period-to-period differences in the
amount of changes in working capital. Changes in working capital is
equal to “Changes in operating assets and liabilities” as disclosed
in the company’s Consolidated statement of cash flows and in
Attachment II of this document. This measure assesses the cash
flows at an operating level, and as such, does not include proceeds
from asset sales as defined in Cash flows from operating activities
and asset sales in the Frequently Used Terms section of the
company’s annual Form 10-K.
Reconciliation of cash flows from (used in) operating
activities excluding working capital
Fourth Quarter
Twelve Months
millions of Canadian dollars
2021
2020
2021
2020
From Imperial's Consolidated statement
of cash flows
Cash flows from (used in) operating
activities
1,632
316
5,476
798
Less changes in working capital
Changes in operating assets and
liabilities
(16)
(248)
363
(335)
Cash flows from (used in) operating
activities excl. working capital
1,648
564
5,113
1,133
Free cash flow
Free cash flow is a non-GAAP financial measure that is cash
flows from operating activities less additions to property, plant
and equipment and equity company investments plus proceeds from
asset sales. The most directly comparable financial measure that is
disclosed in the financial statements is cash flows from (used in)
operating activities within the company’s Consolidated statement of
cash flows. This measure is used to evaluate cash available for
financing activities (including but not limited to dividends and
share purchases) after investment in the business.
Reconciliation of free cash flow
Fourth Quarter
Twelve Months
millions of Canadian dollars
2021
2020
2021
2020
From Imperial's Consolidated statement
of cash flows
Cash flows from (used in) operating
activities
1,632
316
5,476
798
Cash flows from (used in) investing
activities
Additions to property, plant and
equipment
(424)
(211)
(1,108)
(868)
Proceeds from asset sales
24
14
81
82
Loans to equity companies - net
1
-
15
(16)
Free cash flow
1,233
119
4,464
(4)
Net income (loss) excluding identified items
Net income (loss) excluding identified items is a non-GAAP
financial measure that is total net income (loss) excluding
individually significant non-operational events with an absolute
corporate total earnings impact of at least $100 million in a given
quarter. The net income (loss) impact of an identified item for an
individual segment in a given quarter may be less than $100 million
when the item impacts several segments or several periods. The most
directly comparable financial measure that is disclosed in the
financial statements is net income (loss) within the company’s
Consolidated statement of income. Management uses these figures to
improve comparability of the underlying business across multiple
periods by isolating and removing significant non-operational
events from business results. The company believes this view
provides investors increased transparency into business results and
trends, and provides investors with a view of the business as seen
through the eyes of management. Net income (loss) excluding
identified items is not meant to be viewed in isolation or as a
substitute for net income (loss) as prepared in accordance with
U.S. GAAP. All identified items are presented on an after-tax
basis.
Reconciliation of net income (loss) excluding identified
items
Fourth Quarter
Twelve Months
millions of Canadian dollars
2021
2020
2021
2020
From Imperial's Consolidated statement
of income
Net income (loss) (U.S. GAAP)
813
(1,146)
2,479
(1,857)
Less identified items included in Net
income (loss)
Impairments
-
(1,171)
-
(1,171)
Subtotal of identified items
-
(1,171)
-
(1,171)
Net income (loss) excluding identified
items
813
25
2,479
(686)
Cash operating costs (cash costs)
Cash operating costs is a non-GAAP financial measure that
consists of total expenses, less costs that are non-cash in nature,
including, Purchases of crude oil and products, Federal excise
taxes and fuel charge, Depreciation and depletion, Non-service
pension and postretirement benefit, and Financing. The components
of cash operating costs include (1) Production and manufacturing,
(2) Selling and general and (3) Exploration, from the company’s
Consolidated statement of income, and as disclosed in Attachment
III of this document. The sum of these income statement lines serve
as an indication of cash operating costs and does not reflect the
total cash expenditures of the company. The most directly
comparable financial measure that is disclosed in the financial
statements is total expenses within the company’s Consolidated
statement of income. This measure is useful for investors to
understand the company’s efforts to optimize cash through
disciplined expense management.
Reconciliation of cash operating
costs
Fourth Quarter
Twelve Months
millions of Canadian dollars
2021
2020
2021
2020
From Imperial's Consolidated statement
of Income
Total expenses
11,201
7,496
34,307
24,796
Less:
Purchases of crude oil and products
8,122
3,318
23,174
13,293
Federal excise taxes and fuel charge
524
446
1,928
1,736
Depreciation and depletion
545
1,998
1,977
3,293
Non-service pension and postretirement
benefit
10
30
42
121
Financing
22
18
54
64
Total cash operating costs
1,978
1,686
7,132
6,289
Components of cash operating
costs
Fourth Quarter
Twelve Months
millions of Canadian dollars
2021
2020
2021
2020
From Imperial's Consolidated statement
of Income
Production and manufacturing
1,737
1,437
6,316
5,535
Selling and general
215
242
784
741
Exploration
26
7
32
13
Cash operating costs
1,978
1,686
7,132
6,289
Segment contributions to total cash
operating costs
Fourth Quarter
Twelve Months
millions of Canadian dollars
2021
2020
2021
2020
Upstream
1,292
1,004
4,693
3,865
Downstream
562
545
2,017
2,087
Chemicals
87
81
300
307
Corporate/Eliminations
37
56
122
30
Cash operating costs
1,978
1,686
7,132
6,289
Unit cash operating cost (unit cash costs)
Unit cash operating costs is a non-GAAP ratio. Unit cash
operating costs (unit cash costs) is calculated by dividing cash
operating costs by total gross oil-equivalent production, and is
calculated for the Upstream segment, as well as the major Upstream
assets. Cash operating costs is a non-GAAP financial measure and is
disclosed and reconciled above. This measure is useful for
investors to understand the expense management efforts of the
company’s major assets as a component of the overall Upstream
segment. Unit cash operating cost, as used by management, does not
directly align with the definition of “Average unit production
costs” as set out by the U.S. Securities and Exchange Commission
(SEC), and disclosed in the company’s SEC Form 10-K.
Components of unit cash operating cost
Fourth Quarter
2021
2020
millions of Canadian dollars
Upstream (a)
Kearl
Cold Lake
Syncrude
Upstream (a)
Kearl
Cold Lake
Syncrude
Production and manufacturing
1,266
561
315
333
997
398
267
277
Selling and general
-
-
-
-
-
-
-
-
Exploration
26
-
-
-
7
-
-
-
Cash operating costs
1,292
561
315
333
1,004
398
267
277
Gross oil-equivalent production
445
191
142
79
460
202
136
87
(thousands of barrels per day)
Unit cash operating cost
($/oeb)
31.56
31.93
24.11
45.82
23.72
21.42
21.34
34.61
USD converted at the quarterly average
forex
24.93
25.22
19.05
36.20
18.26
16.49
16.43
26.65
2021 US$0.79; 2020 US$0.77
Twelve Months
2021
2020
millions of Canadian dollars
Upstream (a)
Kearl
Cold Lake
Syncrude
Upstream (a)
Kearl
Cold Lake
Syncrude
Production and manufacturing
4,661
1,902
1,117
1,388
3,852
1,585
920
1,107
Selling and general
-
-
-
-
-
-
-
-
Exploration
32
-
-
-
13
-
-
-
Cash operating costs
4,693
1,902
1,117
1,388
3,865
1,585
920
1,107
Gross oil-equivalent production
428
186
140
71
398
158
132
69
(thousands of barrels per day)
Unit cash operating cost
($/oeb)
30.04
28.02
21.86
53.56
26.53
27.41
19.04
43.83
USD converted at the YTD average forex
24.03
22.42
17.49
42.85
19.90
20.56
14.28
32.87
2021 US$0.80; 2020 US$0.75
(a) Upstream includes Kearl, Cold Lake,
Imperial's share of Syncrude and other.
After more than a century, Imperial continues
to be an industry leader in applying technology and innovation to
responsibly develop Canada’s energy resources. As Canada’s largest
petroleum refiner, a major producer of crude oil, a key
petrochemical producer and a leading fuels marketer from coast to
coast, our company remains committed to high standards across all
areas of our business.
Source: Imperial
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220201005385/en/
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