Canada's Suncor Energy Swings to Profit
October 26 2016 - 9:00PM
Dow Jones News
CALGARY, Alberta—Suncor Energy Inc., Canada's largest crude-oil
producer, reported a third-quarter net profit of 392 million
Canadian dollars ($293 million) late Wednesday, recovering from
wild fire-related production cuts and swooning commodity
prices.
The Calgary-based company said it earned 24 Canadian cents a
share in the three months ended Sept. 30 compared with a net loss
of C$376 million, or 26 Canadian cents a share, in the same period
last year. In the second quarter, it lost C$735 million, or 46
cents a share.
Suncor credited increased output from acquisitions, lower
operating costs and record crude-processing volumes at its
refineries. It also benefited from the resumption of production at
oil-sands facilities temporarily closed by the threat from forest
fires in May, and an increase in crude-oil prices from lows reached
earlier in the year.
The oil and gas field operator raised its full-year production
forecast to a range of 610,000 to 625,000 barrels of oil equivalent
a day, up from its previous estimate of 585,000 to 620,000 barrels
of oil equivalent a day. Suncor trimmed its 2016 capital spending
budget to between C$5.8 billion and C$6.0 billion, down from a
previous projection of C$6 billion to C$6.5 billion.
On an operating, or adjusted, basis that excludes one-time
items, the company posted quarterly earnings of C$346 million, or
C$0.21 a share. That was below the C$410 million, or C$0.28 a
share, it earned in the year-earlier period but above analysts'
average forecast for C$0.09 a share, according to RBC Dominion
Securities Inc.
Cash flow from operations came to C$2.0 billion, slightly above
the C$1.88 billion it generated a year before.
Suncor is the first major Canadian energy producer to report
quarterly results, and its performance is viewed as a barometer for
an industry hard hit by a slump in crude-oil prices. Cenovus Energy
Inc. and Husky Energy Inc. post earnings on Thursday and Canadian
Natural Resources Ltd., the country's largest natural-gas producer
and a large oil-sands operator, does so next week.
Suncor said oil-sands output rose to 433,700 barrels of oil a
day in the July-to-September quarter, just above the 430,300
barrels of oil a day produced a year prior and well above the
177,500 barrels a day logged in the second quarter. That dip
resulted from the production outages caused by uncontrolled wild
fires that raged around—but didn't damage—its operations in
northern Alberta.
Overall production volumes at Suncor averaged 728,100 barrels of
oil equivalent a day, up from 330,700 in the previous quarter and
above the 566,100 it produced a the year before.
Those production figures include volumes from the acquisition of
Canadian Oil Sands Ltd. in March and Murphy Oil Corp.'s interest in
Syncrude Canada Ltd. in April. Those two deals boosted Suncor's
ownership in that oil-sands consortium to a controlling 54%.
Write to Chester Dawson at chester.dawson@wsj.com
(END) Dow Jones Newswires
October 26, 2016 21:45 ET (01:45 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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