Chevron moves up after easy Q3 earnings beat; operating cash flow hits record

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Chevron (NYSE:CVX) +2.1% pre-market and could open at a record high Friday, after Q3 adjusted earnings and revenues easily topped analyst expectations.

Q3 net income jumped to $11.23B, or $5.78/share, from $6.11B, or $3.19/share, in the year-earlier quarter, although profit slipped 3% from its all-time high in Q2 due to more than $600M in net charges during the quarter.

Q3 revenues rose 49% Y/Y to $66.64B, and total costs rose less than revenue, up 41% to $51.84B.

Chevron (CVX) said cash flow from operations surged to a record $15.3B, and free cash flow totaled $12.3B; return on capital employed jumped to 25%.

Q3 earnings in U.S. upstream operations rose to $3.4B from $1.96B a year earlier, primarily due to higher realizations and higher volumes, partially offset by the absence of asset sale gains in the prior-year period.

Q3 earnings in U.S. downstream operations edged higher to $1.29B from $1.08B a year earlier, due mostly to higher margins on refined product sales, partially offset by lower earnings from 50%-owned Chevron Phillips Chemical and higher operating expenses that were largely associated with planned turnarounds.

Q3 worldwide net production totaled 3.03M bbl/day, with output in the International segment declining 3% Y/Y primarily due to the end of concessions in Thailand and Indonesia, while U.S. production increased 4%, mainly in the Gulf of Mexico and the Permian Basin.

Output from the Permian Basin topped 700K boe/day, up 12% Y/Y and slightly more than 692K boe/day in Q2.

The company's Q3 average sales price for crude oil and natural gas liquids in U.S. upstream operations was $76/bbl, up from $58/bbl in the year-earlier quarter, and the average sales price of natural gas surged to $7.05/Mcf from $3.25/Mcf in a year ago.

Chevron's (CVX) stock price return shows a 49% YTD gain and a 58% increase during the past year.