Chevron Updates Stockholders at Annual Meeting
Chevron (NYSE: CVX) highlighted its 2024 business performance at its Annual Meeting of Stockholders. Chairman and CEO Michael Wirth emphasized strong operational performance, cost and capital discipline, and consistent cash returns to shareholders. Chevron achieved its highest-ever annual production of 3.1 million barrels per day in 2023. The first quarter marked the ninth consecutive quarter with adjusted earnings over $5 billion and an adjusted ROCE above 12%. Key projects in the Gulf of Mexico and advancements in lower carbon intensity fuels were noted. Recent acquisitions, including PDC Energy and ACES Delta, enhance Chevron's U.S. presence and green hydrogen capabilities. Wirth reiterated financial priorities: growing dividends, efficient capital investment, maintaining a strong balance sheet, and returning excess cash to stockholders. Preliminary meeting results are online, with final results to be filed with the SEC.
- Chevron achieved the highest production in its history with 3.1 million barrels of oil-equivalent per day in 2023.
- The company marked its ninth consecutive quarter with adjusted earnings over $5 billion.
- Adjusted ROCE remained strong at over 12%.
- Chevron reached first oil at the Mad Dog 2 project and completed the installation of the floating production unit for the Anchor field.
- The acquisition of PDC Energy, adding 300,000 net acres in the DJ and Permian Basins, boosts Chevron’s U.S. presence.
- The acquisition of a majority stake in ACES Delta accelerates the development of a green hydrogen production and storage hub in Utah.
- Chevron continues to evolve its refining system to produce lower carbon intensity fuels.
- The company maintains a single-digit net debt ratio.
- There was no mention of specific revenue growth or projections.
- The PR lacked detailed information on potential risks or challenges faced by new projects.
- No information was provided on any potential environmental concerns related to increasing production levels.
Insights
Chevron reported the highest production levels in its history, achieving 3.1 million barrels of oil-equivalent per day in 2023. This is a positive sign for investors, indicating strong operational efficiency and robust demand for Chevron's products. The company's consistent performance, with nine consecutive quarters of adjusted earnings over
From a financial perspective, these developments appear promising. However, investors should watch for any external factors that might affect oil prices and Chevron's operational costs. The emphasis on returning cash to shareholders and maintaining a strong balance sheet also underlines the company's commitment to providing value to its investors.
Chevron's advancements in both traditional and renewable energy projects are notable. Achieving first oil at the Mad Dog 2 project and the installation of the floating production unit for the Anchor field in the Gulf of Mexico are significant milestones. These projects could result in increased production capacity and revenue streams. On the renewable front, the conversion of the diesel hydroheater at the El Segundo refinery and the acquisition of ACES Delta highlight Chevron's commitment to lower carbon intensity fuels and green hydrogen production. This diversification aligns with global trends towards cleaner energy and could enhance Chevron's long-term sustainability and market position.
Nevertheless, the transition to renewable energy is capital intensive and comes with technological and regulatory challenges. Investors should consider the potential risks associated with these new ventures and monitor Chevron's progress in achieving these initiatives.
Chevron's strategic acquisitions and high production levels underscore a robust growth strategy. The integration of PDC Energy expands Chevron's presence in key U.S. basins, enhancing its resource base and potential market share. Meanwhile, the focus on green hydrogen through ACES Delta positions Chevron to capitalize on emerging markets for cleaner energy. This dual focus could appeal to a broader range of investors, including those interested in sustainable investment opportunities. However, market dynamics such as fluctuating energy prices and evolving environmental regulations will play important roles in shaping Chevron's future performance.
In the short term, Chevron's strong production metrics and financial discipline suggest stability and potential for solid returns. Long-term success will depend on the company's ability to navigate the energy transition while maintaining profitability in its core oil and gas business.
“Chevron continues to deliver strong operational performance, maintain cost and capital discipline and consistently return cash to shareholders,” said Michael Wirth, Chevron’s chairman and CEO. “We’ve strengthened our portfolio to grow both traditional and new energy supplies by advancing major capital projects and completing strategic acquisitions.”
Chevron delivered the highest production in company history with annual production of 3.1 million barrels of oil-equivalent per day in 2023, underscoring the company’s track record of strong leadership and worldwide demand for affordable and reliable energy. This year’s first quarter performance marked the company’s ninth consecutive quarter with adjusted earnings over
In the Gulf of
The completed acquisition of PDC Energy, Inc. boosts Chevron’s
“Our financial priorities remain unchanged – grow the dividend, invest capital efficiently, maintain a strong balance sheet and return excess cash to stockholders,” Wirth said. “It’s also important to recognize that we’ve maintained our financial strength with a single-digit net debt ratio and continue to achieve our objective of safely delivering higher returns, lower carbon and superior shareholder value in any business environment.”
The preliminary results from the meeting can be accessed online at www.chevron.com. Final voting results on all agenda items will be posted in the same location after they have been reported on a Form 8-K, which will be filed with the
Chevron is one of the world’s leading integrated energy companies. We believe affordable, reliable and ever-cleaner energy is essential to enabling human progress. Chevron produces crude oil and natural gas; manufactures transportation fuels, lubricants, petrochemicals and additives; and develops technologies that enhance our business and the industry. We aim to grow our oil and gas business, lower the carbon intensity of our operations and grow lower carbon businesses in renewable fuels, carbon capture and offsets, hydrogen and other emerging technologies. More information about Chevron is available at www.chevron.com.
NOTICE
As used in this news release, the term “Chevron” and such terms as “the company,” “the corporation,” “our,” “we,” “us” and “its” may refer to Chevron Corporation, one or more of its consolidated subsidiaries, or to all of them taken as a whole. All of these terms are used for convenience only and are not intended as a precise description of any of the separate companies, each of which manages its own affairs.
Please visit Chevron’s website and Investor Relations page at www.chevron.com and www.chevron.com/investors, LinkedIn: www.linkedin.com/company/chevron, Twitter: @Chevron, Facebook: www.facebook.com/chevron, and Instagram: www.instagram.com/chevron, where Chevron often discloses important information about the company, its business, and its results of operations.
CAUTIONARY STATEMENTS RELEVANT TO FORWARD-LOOKING INFORMATION FOR THE PURPOSE OF “SAFE HARBOR” PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
This news release contains forward-looking statements relating to Chevron’s operations and lower carbon strategy that are based on management’s current expectations, estimates, and projections about the petroleum, chemicals and other energy-related industries. Words or phrases such as “anticipates,” “expects,” “intends,” “plans,” “targets,” “advances,” “commits,” “drives,” “aims,” “forecasts,” “projects,” “believes,” “approaches,” “seeks,” “schedules,” “estimates,” “positions,” “pursues,” “progress,” “may,” “can,” “could,” “should,” “will,” “budgets,” “outlook,” “trends,” “guidance,” “focus,” “on track,” “goals,” “objectives,” “strategies,” “opportunities,” “poised,” “potential,” “ambitions,” “aspires” and similar expressions, and variations or negatives of these words, are intended to identify such forward-looking statements, but not all forward-looking statements include such words. These statements are not guarantees of future performance and are subject to numerous risks, uncertainties and other factors, many of which are beyond the company’s control and are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements. The reader should not place undue reliance on these forward-looking statements, which speak only as of the date of this news release. Unless legally required, Chevron undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise. Among the important factors that could cause actual results to differ materially from those in the forward-looking statements are: changing crude oil and natural gas prices and demand for the company’s products, and production curtailments due to market conditions; crude oil production quotas or other actions that might be imposed by the Organization of Petroleum Exporting Countries and other producing countries; technological advancements; changes to government policies in the countries in which the company operates; public health crises, such as pandemics and epidemics, and any related government policies and actions; disruptions in the company’s global supply chain, including supply chain constraints and escalation of the cost of goods and services; changing economic, regulatory and political environments in the various countries in which the company operates; general domestic and international economic, market and political conditions, including the military conflict between
reconciliation of non-GAAP measures
Adjusted earnings and adjusted ROCE
$ millions |
1Q22 |
2Q22 |
3Q22 |
4Q22 |
1Q23 |
2Q23 |
3Q23 |
4Q23 |
1Q24 |
|||||||||
Reported earnings |
6,259 |
11,622 |
11,231 |
6,353 |
6,574 |
6,010 |
6,526 |
2,259 |
5,501 |
|||||||||
Noncontrolling interest |
18 |
93 |
7 |
25 |
31 |
(2) |
29 |
(16) |
50 |
|||||||||
Interest expense (A/T) |
126 |
120 |
117 |
113 |
106 |
111 |
104 |
111 |
109 |
|||||||||
ROCE earnings |
6,403 |
11,835 |
11,355 |
6,491 |
6,711 |
6,119 |
6,659 |
2,354 |
5,660 |
|||||||||
Annualized ROCE earnings |
25,612 |
47,340 |
45,420 |
25,964 |
26,844 |
24,476 |
26,636 |
9,416 |
22,640 |
|||||||||
Average capital employed1 |
173,871 |
178,615 |
182,033 |
183,425 |
183,611 |
182,226 |
183,810 |
184,786 |
183,128 |
|||||||||
ROCE (%) |
|
|
|
|
|
|
|
|
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||
Reported earnings |
6,259 |
11,622 |
11,231 |
6,353 |
6,574 |
6,010 |
6,526 |
2,259 |
5,501 |
|||||||||
Special items |
|
|
|
|
|
|
|
|
|
|||||||||
Asset dispositions |
- |
200 |
- |
- |
- |
- |
- |
- |
- |
|||||||||
Pension settlement & curtailment costs |
(66) |
(11) |
(177) |
(17) |
- |
- |
(40) |
- |
- |
|||||||||
Impairments and other2 |
- |
(600) |
- |
(1,075) |
(130) |
225 |
560 |
(3,715) |
- |
|||||||||
Total special items |
(66) |
(411) |
(177) |
(1,092) |
(130) |
225 |
520 |
(3,715) |
- |
|||||||||
Foreign exchange |
(218) |
668 |
624 |
(405) |
(40) |
10 |
285 |
(479) |
85 |
|||||||||
Adjusted earnings |
6,543 |
11,365 |
10,784 |
7,850 |
6,744 |
5,775 |
5,721 |
6,453 |
5,416 |
|||||||||
Noncontrolling interest |
18 |
93 |
7 |
25 |
31 |
(2) |
29 |
(16) |
50 |
|||||||||
Interest expense (A/T) |
126 |
120 |
117 |
113 |
106 |
111 |
104 |
111 |
109 |
|||||||||
Adjusted ROCE earnings |
6,687 |
11,578 |
10,908 |
7,988 |
6,881 |
5,884 |
5,854 |
6,548 |
5,575 |
|||||||||
Annualized adjusted ROCE earnings |
26,748 |
46,312 |
43,632 |
31,952 |
27,524 |
23,536 |
23,416 |
26,192 |
22,300 |
|||||||||
Average capital employed1 |
173,871 |
178,615 |
182,033 |
183,425 |
183,611 |
182,226 |
183,810 |
184,786 |
183,128 |
|||||||||
Adjusted ROCE (%) |
|
|
|
|
|
|
|
|
|
|||||||||
1 Capital employed is the sum of Chevron Corporation stockholders’ equity, total debt and noncontrolling interests. Average capital employed is computed by averaging the sum of capital employed at the beginning and the end of the period. |
||||||||||||||||||
2 Includes impairment charges, write-offs, decommissioning obligations from previously sold assets, severance costs, unusual tax items, and other special items. |
||||||||||||||||||
Note: Numbers may not sum due to rounding. |
reconciliation of non-GAAP measures
Net debt ratio
$ millions |
1Q24 |
|
Short term debt |
282 |
|
Long term debt* |
21,553 |
|
Total debt |
21,835 |
|
Less: Cash and cash equivalents |
6,278 |
|
Less: Marketable securities |
- |
|
Total adjusted debt |
15,557 |
|
Total Chevron Corporation Stockholders’ Equity |
160,625 |
|
Total adjusted debt plus total Chevron Stockholders’ Equity |
176,182 |
|
Net debt ratio |
|
|
* Includes capital lease obligations / finance lease liabilities. |
||
Note: Numbers may not sum due to rounding. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240529325900/en/
Randy Stuart -- +1 713-283-8609
Source: Chevron Corporation
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