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Occidental Petroleum (OXY) Slips into Q1 Loss, Revenues Beat

Occidental Petroleum Corporation OXY reported first-quarter 2016 loss of 56 cents per share, wider than the Zacks Consensus Estimate of a loss of 41 cents. The company had generated earnings of 4 cents per share in the year-ago quarter.  The dismal performance was due to continued plunge in crude oil and natural gas liquids (NGL) realized prices.

On a GAAP basis, however, the company reported earnings of 10 cents per share in the first quarter, compared with the year-ago loss of 28 cents.

Total Revenue

Occidental Petroleum's total revenue came in at $2,281 million, beating the Zacks Consensus Estimate of $2,123 million. Revenues, however, tanked 26.3% from $3,096 million a year ago primarily due to lower revenues from Oil and Gas (36.5% year over year), Chemical (11%) and Midstream, Marketing (32.5%).

Quarterly Highlights

Occidental Petroleum’s average daily net oil, liquids and gas production volume increased 9.6% year over year to 584,000 barrels of oil equivalents (BOE). The upside was primarily due to higher contribution from the Permian Resource operations, partially offset by lower natural gas and oil production in South Texas.

Realized Price

Realized prices for worldwide crude oil decreased 39.3% year over year to $29.42 per barrel.

Worldwide realized NGL prices declined 39.5% to $10.86 per barrel from $17.96 per barrel a year ago.

Domestic natural gas prices went down 24.7% to $1.25 per thousand cubic feet.

Financial Position

As of Mar 31, 2016, Occidental Petroleum had cash and cash equivalents of $3,176 million, compared with $3,201 million as of Dec 31, 2015.

As of Mar 31, 2016, Occidental Petroleum had long-term debt (net of current portion) of $5,608 million, compared with $6,855 million as of Dec 31, 2015.

In the reported quarter, the company’s cash from operations was $139 million, down from $566 million in the prior-year period.

Occidental Petroleum’s total capital expenditure was $687 million in the quarter under review, compared with $1,735 million a year ago.

Guidance

Occidental Petroleum raised its oil and gas production growth outlook to 4–6% from the previous projection of 2–4%. The company maintained its full-year capital expenditure guidance of $3 billion.

Peer Releases

ConocoPhillips COP reported first-quarter 2016 adjusted loss per share of 95 cents, narrower than the Zacks Consensus Estimate of a loss of $1.07.

Hess Corporation HES reported adjusted first-quarter 2016 loss from continuing operations of $1.72 per share, narrower than the Zacks Consensus Estimate of a loss of $1.81.

Marathon Oil Corporation MRO reported first-quarter 2016 adjusted loss per share of 43 cents, narrower than the Zacks Consensus Estimate of a loss of 47 cents.

Zacks Rank

Occidental Petroleum currently has a Zacks Rank #3 (Hold).

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