Noble Energy Inc.'s (NBL) first-quarter profit dropped 94% on losses
from derivatives and other charges, while adjusted earnings grew on higher oil
prices. The core results beat Wall Street expectations.
Noble was the first company to win a new permit in the Gulf of Mexico after the
Deepwater Horizon disaster through a so-called permit to bypass, which allowed
it to drill despite a federal moratorium. But the company still recorded an $18
million rig standby charge related to another deepwater well in the Gulf.
The oil-and-gas explorer stands to benefit in the long run from a string of
recent global discoveries, including Israel's Leviathan reserve, which contains
about 16 trillion cubic feet of natural gas. The company has a 39.66% working
interest in the Leviathan discovery but said earlier this month it was forced
to suspend drilling while it works to obtain certain equipment that isn't
available in Israel after Noble identified wear on the wellbore casing.
"With high liquid volumes and pricing, combined with good cost control,
the business generated very strong cash flow," Chairman and Chief
Executive Charles D. Davidson said. "Our balance sheet was further
fortified with a successful debt offering, and as a result, the company is in a
very strong position."
Noble posted a first-quarter profit of $14 million, or 8 cents a share, down
from $237 million, or $1.34 a share, a year earlier. Excluding derivatives
losses, rig standby charges and other items, adjusted earnings rose to $1.35
from 78 cents a share. Revenue rose 23% to $899 million.
Analysts polled by Thomson Reuters were expecting a per-share profit of $1.14
on $829 million in revenue.
Revenue from crude oil, the company's biggest top-line contributor, rose 40%,
while natural-gas sales revenue slid 11%. Sales volumes increased 9%.
Noble said it expects second-quarter volumes to average 208,000 to 218,000
barrels of oil equivalent a day.
Shares of Noble, which affirmed its volume guidance for the year, closed at
$95.33 Wednesday and were inactive premarket. The stock has climbed 21% over the past 12 months.