Chevron reports Q2 earnings miss on weak refining margins
Business
Chevron reports Q2 earnings miss on weak refining margins
(Reuters) - Chevron(CVX.N), opens new tab reported second-quarter earnings on Friday that missed Wall Street estimates due to industry-wide pressure from lower refining margins and natural gas prices, sending its shares down 1.5% in premarket trading.
The company earlier had warned oil output this quarter would slip and refining would suffer from turnarounds at two refineries in California. Refining margins have been weak globally, hurting other oil majors like BP (BP.L), opens new tab and Shell (SHEL.L), opens new tab.
Chevron said it would relocate the company's headquarters from San Ramon, California, where it was born 145 years ago as Pacific Coast Oil Co, to Houston. The company has been bitterly contesting state regulations on its oil producing and refining operations in the state.
Chevron reported earnings of $4.4 billion, or $2.43 per share, in the quarter, compared with $6 billion a year before.
It reported adjusted earnings of $4.7 billion, or $2.55 per share, compared to $2.93 expected by Wall Street analysts, according to LSEG data.
"Results were disappointing," said Peter McNally, global sector lead for energy at Third Bridge.
The shortfall can be attributed to the international upstream segment, which missed expectations by approximately 11%, he said.
Earnings from pumping oil and gas were down 9.4% from a year earlier. Profit from producing gasoline and chemicals was also down about 60% to $597 million.
"Despite recent operational downtime and softer margins, we remain poised to deliver significant long-term earnings and cash flow growth," CEO Mike Wirth said.
