Energy Giant Equinor's Q3 Earnings: Revenue & Profits Tumble Significantly On Weak Gas Production

Equinor ASA EQNR reported Q3 FY23 adjusted revenue and other income decline of 41% Y/Y to $25.74 billion.

Liquids production rose 12% Y/Y, aided by strong operational performance and production from Johan Sverdrup on the NCS, Vito field in the USA, the Peregrino field in Brazil, and the addition of the Buzzard field in the UK portfolio.

Group average liquids price declined 14% Y/Y to $80.3/bbl, and equity liquids and gas production fell 1% Y/Y to $2,007 mboe per day.

Notably, gas equity production fell 13% Y/Y owing to maintenance and unplanned turnaround extensions primarily on the NCS.

Adjusted earnings declined 67% Y/Y $8.024 billion, with the Marketing, Midstream & Processing (MMP) segment delivering adjusted earnings coming in at $876 million, led by strong sales and trading of oil and oil products, shipping portfolio optimization, and high refining margins.

Operating cash flow stood at $5.236 billion in the quarter.

In Q3, Equinor completed five exploration wells offshore with two commercial discoveries and had 12 wells ongoing at the end of the quarter.

Anders Opedal, president and CEO of Equinor, said, "The gas production from the Norwegian continental shelf was impacted by planned maintenance and extended turnarounds. We continue with significant capital distribution and will deliver a total distribution of 17 billion dollars in 2023."

The board of directors declared an ordinary cash dividend per share of $0.30 and to continue the extraordinary cash dividend per share of $0.60 in Q3 FY23.

The company completed the third tranche of the share buyback program for 2023 on October 20, 2023, with a total value of up to $1.67 billion.

The board of directors has decided to initiate a fourth and final tranche of the share buyback program of $1.67 billion. 

FY23 Outlook: EQNR updates FY23 outlook for production to be around 1.5% above 2022, organic capital expenditures of $10 billion-$11 billion, and an annual average of about $13 billion for 2024-2026.

Price Action: EQNR shares are trading higher by 1.91% at $33.59 on the last check Friday.