Chevron Q1 Performance: Flat Production and Lower ASP, Higher Downstream Earnings with High Refined Product Margins

Chevron Corporation CVX reported first-quarter FY23  sales of $50.79 billion, a decline of 6.6% year-over-year, beating the consensus of $47.98 billion.

Adjusted net earnings were $6.74 billion (+3.1% Y/Y), with Adjusted EPS being $3.55, beating the consensus of $3.41.

The company stated that the Q1 earnings increase reflects higher margins on refined product sales, partially offset by lower upstream realizations. Sales and other operating revenues decline reflect lower commodity prices.

Q1 Net oil-equivalent production was down 3% Y/Y to 2,979 MBOED, reflecting lower international production due to the end of the Erawan concession in Thailand. 

Also Read: Chevron Likely To Report Higher Q1 Earnings; Here's A Look At Recent Price Target Changes By The Most Accurate Analysts

Total shareholder distributions were $6.6 billion during the quarter, including dividends of $2.9 billion and share repurchases of $3.75 billion.

The company expects to repurchase $4.375 billion in shares in 2Q23.

Dividend: CVX declared a quarterly dividend of $1.51 per share, payable June 12, 2023, to the shareholders of record date May 19, 2023.

U.S. upstream earnings were 45% lower than a year ago, primarily on lower realizations.

International upstream earnings were 8.6% lower than a year ago due to lower realizations, lower sales volumes, and higher tax charges.

U.S. downstream earnings were almost doubled compared to a year ago, primarily due to higher margins on refined product sales.

International downstream earnings were higher than a year ago, primarily due to higher margins on refined product sales, partially offset by higher operating expenses.

Net cash provided by operating activities for the quarter totaled $7.2 billion, compared to $8.1 billion a year ago. Free cash flow was $4.2 billion.

CVX held cash and cash equivalents of $15.67 billion as of March 31, 2023.

"The company's return on capital employed has been greater than 12 percent for seven consecutive quarters, and the company returned $6.6 billion to shareholders in the first quarter, an increase of 65 percent from last year," stated Mike Wirth, Chevron's chairman, and CEO. 

Price Action: CVX shares are trading lower by 0.79% at $165.63 on the last check Friday.