ConocoPhillips Cuts 2016 Spending Plans, Slashes Dividend -- Update
February 04 2016 - 8:33AM
Dow Jones News
By Tess Stynes
ConocoPhillips further reduced its capital-spending plans to
$6.4 billion for 2016 and said its board slashed is quarterly
dividend, joining a list of major oil companies to get slammed by
low oil prices.
Shares fell 4.2% to $37 in recent premarket trading.
The company also reported a fourth-quarter loss of $3.45
billion, or $2.78 a share, as it posted $2.7 billion in asset
write-downs to reflect commodities prices and changes in its energy
exploration plans. A year earlier, it recorded a loss of $39
million, or three cents a share.
Excluding asset write-downs, asset-sale gains and other items,
the adjusted per-share loss was 90 cents, compared with
year-earlier adjusted earnings of 60 cents. Revenue slumped 43% to
$6.77 billion.
Analysts polled by Thomson Reuters had expected per-share loss
of 65 cents and revenue of $9.06 billion.
ConocoPhillips said its board approved cutting the quarterly
dividend to 25 cents a share from the previous level of 74 cents a
share.
The company, which in December had projected 2016 capital
expenditures at $7.7 billion, on Thursday also cut it operating
cost estimate to $7 billion from $7.7 billion.
ConocoPhillips said the reduced capital-spending guidance mostly
reflects reduced activity in the lower 48 U.S. states.
Chairman and Chief Executive Ryan Lance said in a news release,
"While we don't know how far commodity prices will fall, or the
duration of the downturn, we believe it's prudent to plan for lower
prices for a longer period of time."
"The actions we have announced will improve net cash flow by
$4.4 billion in 2016," Mr. Lance stated.
ConocoPhillips said that average selling prices fell 46% from a
year earlier, offsetting an increase in production.
The company also has been selling assets and had planned to
divest itself of about $2.3 billion in assets in 2015. On Thursday
the company said it had completed roughly $2 billion in asset sales
last year.
Write to Tess Stynes at tess.stynes@wsj.com
(END) Dow Jones Newswires
February 04, 2016 08:18 ET (13:18 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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