Chevron has reported net income of $4.44bn for the second quarter of 2024 (Q2 2024), a decrease of 26% from $6bn in the same quarter of the previous year (Q2 2023).
In the preceding quarter, that is Q1 2024, the American energy company had net income of $5.5bn.
The diluted earnings per share (EPS) of Chevron in Q2 2024 ended 30 June 2024 were $2.43, down 24% from $3.2 in the corresponding quarter of the previous year.
According to Chevron, earnings for Q2 2024 declined primarily due to lower margins on refined product sales, the absence of favourable tax items from the prior year, and negative foreign currency effects.
Chevron’s total revenues for the reported quarter were $51.18bn, an increase of 4.7% from $48.89bn in Q2 2023. The company’s total revenues in Q1 2024 were $48.7bn.
Chevron chairman and CEO Mike Wirth said: “This quarter, we delivered strong production, enhanced our global exploration portfolio and extended our track record of consistent shareholder returns with over $50bn of distributions in the last two years.
“Despite recent operational downtime and softer margins, we remain poised to deliver significant longterm earnings and cash flow growth.”
The company’s worldwide net oil-equivalent production increased by 11% year-on-year, largely due to the acquisition of PDC Energy and strong performance in the Permian and Denver-Julesburg (DJ) Basins in the US. This increase was partially offset by downtime in Australia.
Capital expenditure (Capex) for Q2 2024 rose compared to last year, primarily due to increased investment in upstream activities, including post-acquisition spending on legacy PDC assets.
Cash flow from operations remained consistent with the same period last year, as lower earnings were offset by higher dividends from equity affiliates and reduced working capital.
Chevron also secured agreements in Namibia, Brazil, Equatorial Guinea, and Angola to expand its global exploration acreage.
In the US, net oil-equivalent production rose by 353,000 barrels per day year-on-year, mainly due to the successful integration of PDC and record production in the Permian Basin.
Outside the US, net oil-equivalent production decreased by 20,000 barrels per day compared to the previous year. This was mainly due to downtime in Australia and the exit from Myanmar, though this decrease was partially offset by increased production in Canada, which benefited from the absence of wildfire-related shutdowns.
Refined product sales increased by 2% both in the US and in the rest of the world compared to the previous year.
Chevron also announced that it will relocate its headquarters from San Ramon, California, to Houston, Texas, with all corporate functions moving over the next five years. Senior leaders, including chairman and CEO Mike Wirth and vice chairman Mark Nelson, will move to Houston by the end of this year.
In late 2023, Chevron signed an all-stock deal worth $53bn to acquire rival American publicly listed oil and gas company Hess. The deal is currently facing delays due to arbitration claims from ExxonMobil and its partner CNOOC, asserting a right of first refusal for Hess’s stake in a Guyana oil-producing joint venture.
