Chevron Corp's quarterly profit more than doubled, beating forecasts, as a bounce in oil prices offset lower refinery earnings at the second-largest U.S. oil company.
While its downstream earnings were starting to recover from a brutal 2009, Chief Financial Officer Pat Yarrington said on Friday she saw some softening in the U.S. West Coast and Singapore refining markets going into the second quarter.
You may still have some sloppiness in the market, she told analysts on a conference call referring to how refining capacity under maintenance was coming back on line.
Oil and gas production climbed to 2.78 million barrels of oil equivalent per day in the quarter, up 120,000 barrels per day, as the company increased its output in the United States, Nigeria, Angola and at Tengiz in Kazakhstan.
Chevron is targeting average production of 2.73 million boe per day for 2010, and said it will discuss this outlook further at the second-quarter earnings conference call in July.
Chevron and other oil companies' offshore operations are coming under increased scrutiny because of the massive oil spill in the Gulf of Mexico at a BP well, and the White House said it would not open new regions to drilling until the cause of the disaster had been determined.
Yarrington said Chevron, a major Gulf of Mexico producer, was assisting BP and the U.S. government, but it was too early to say how the situation would play out.
We wouldn't want to prejudge or leap too quickly, she said. I'm sure the administration and members of Congress won't want to be doing that either.
THE NEW BOSS
First-quarter net profit rose to $4.55 billion, or $2.27 per share, from $1.84 billion, or 92 cents per share, a year earlier. Revenue rose 34 percent to $46.7 billion.
Excluding $175 million in charges for job cuts, the San Ramon, California-based company earned $2.36 per share, easily topping the $1.94 that analysts had expected, according to the average on Thomson Reuters I/B/E/S.
It was Chevron's first set of results under Chief Executive John Watson, a 30-year company veteran and California native who plans to turn around the refining business while proceeding with a line-up of oil and gas projects.
They're in good shape, Edward Jones analyst Brian Youngberg said of the company. There's really no need to make any significant change.
The company's downstream, or refining and marketing, business, posted profits of $82 million in the quarter, down from $136 million a year earlier, but far better than the $333 million loss the previous quarter.
Earlier, French peer Total posted 9 percent growth in quarterly profit, in line with estimates.
Most of the world's major private-sector oil companies reported stronger-than-expected profits this week, while market leader Exxon Mobil Corp was hit by the impact of U.S. health reform and a weak refining performance.
Shares of Chevron, which have risen nearly 14 percent in just over two months as oil prices have risen, were down 3 cents to $82.28 in early afternoon trade.
(Reporting by Matt Daily in New York and Braden Reddall in San Francisco, editing by Gerald E. McCormick, Lisa Von Ahn and Leslie Gevirtz)