Imperial announces fourth quarter 2023 financial and operating results
- Quarterly net income of $1,365 million
- Cash flow from operating activities of $1,311 million
- Upstream production of 452,000 gross oil-equivalent barrels per day
- Highest ever quarterly production at Kearl of 308,000 total gross oil-equivalent barrels per day
- Downstream operating performance with refinery capacity utilization of 94%
- Returned more than $2.7 billion to shareholders in the fourth quarter, including successful completion of the substantial issuer bid
- Quarterly dividend increased by 20 percent from 50 cents to 60 cents per share
- Released annual corporate Sustainability report, outlining the company's sustainability focus areas and progress
- Full-year estimated net income was $4,889 million with cash flow from operating activities of $3,734 million
- Excluding the impacts of working capital, cash flow from operating activities was $1,799 million, compared to $1,946 million in the third quarter
Insights
The reported quarterly net income of $1,365 million indicates a decline when compared to the previous year's same quarter, which is a significant metric for investors as it reflects the company's profitability. This decline, primarily driven by lower commodity prices, could signal a potential red flag for investors who seek growth in earnings. The cash flow from operating activities, a critical indicator of the company's ability to generate cash to fund operations, investments and dividends, also saw a decrease. However, the company's ability to maintain a high cash flow from operating activities excluding working capital adjustments suggests operational efficiency and effective capital management.
Investors might view the substantial capital returned to shareholders ($2.7 billion) as a strong commitment to shareholder value. The increase in the quarterly dividend by 20 percent could be perceived as a positive sign of financial health and confidence in future cash flows. Nonetheless, the long-term sustainability of such shareholder returns depends on the company's continued performance and commodity market conditions.
The record production levels at Kearl and the highest upstream production in over 30 years are noteworthy achievements, likely contributing to the company's robust financial performance. These operational milestones, especially in the context of the divestment of XTO Energy Canada, highlight the company's operational excellence and could positively influence its market position. The implementation of industry-first solvent-assisted SAGD technology at Cold Lake Grand Rapids is an innovative step that may not only enhance production efficiency but also improve the company's environmental footprint, an increasingly important factor for socially responsible investors.
Downstream operations also demonstrated strong performance with a refinery capacity utilization of 94 percent, which indicates a high level of operational efficiency and could be a positive sign for investors interested in the company's refining segment. The successful completion of the largest planned turnaround in Sarnia site history, under budget and ahead of schedule, further underlines the company's strong project execution capabilities.
The report's emphasis on strategic investments aimed at lowering emissions, such as the Grand Rapids expansion and the Strathcona renewable diesel facility, aligns with the broader industry trend towards sustainability. These initiatives could position the company favorably in the transition to cleaner energy sources and may attract investment from funds focused on environmental, social and governance (ESG) criteria.
However, the energy market normalization in 2023 with fluctuating crude oil prices and the Canadian WTI/WCS spread's performance are external factors that could impact the company's future profitability. The company's ability to navigate these market conditions, maintain production efficiency and control operating costs will be critical for sustaining its financial health and appealing to investors with a long-term perspective.
-
Quarterly net income of
$1,365 million -
Cash flow from operating activities of
$1,311 million $1,799 million - Upstream production of 452,000 gross oil-equivalent barrels per day, highest in over 30 years when adjusted for divestment of XTO Energy Canada
- Highest ever quarterly production at Kearl of 308,000 total gross oil-equivalent barrels per day (218,000 barrels Imperial's share)
- Started steam injection at Cold Lake Grand Rapids, which will be the first deployment in industry of solvent-assisted SAGD technology
-
Strong Downstream operating performance with refinery capacity utilization of 94 percent, following completion of the largest planned turnaround in
Sarnia site history -
Returned more than
$2.7 billion -
Quarterly dividend increased by 20 percent from
50 cents to60 cents per share - Released annual corporate Sustainability report, outlining the company's sustainability focus areas and progress
|
Fourth quarter |
Twelve months |
||||
millions of Canadian dollars, unless noted |
2023 |
2022 |
∆I |
2023 |
2022 |
∆I |
Net income (loss) ( |
1,365 |
1,727 |
(362) |
4,889 |
7,340 |
(2,451) |
Net income (loss) per common share, assuming dilution (dollars) |
2.47 |
2.86 |
(0.39) |
8.49 |
11.44 |
(2.95) |
Capital and exploration expenditures |
469 |
488 |
(19) |
1,778 |
1,490 |
+288 |
Imperial reported estimated net income in the fourth quarter of
“Our strong 2023 financial results were underpinned by solid operational performance across all of our businesses, highlighted by record production and substantial unit cost reductions at Kearl,” said Brad Corson, chairman, president and chief executive officer. “Throughout the year, we also made significant progress on strategic investments that will help lower emissions and capture value for our shareholders, including the
Upstream production in the fourth quarter averaged 452,000 gross oil-equivalent barrels per day, the highest quarterly production in over 30 years when adjusting for the divestment of XTO Energy Canada, with full-year production of 413,000 gross oil-equivalent barrels per day. At Kearl, quarterly total gross production averaged 308,000 barrels per day (218,000 barrels Imperial's share), the highest quarterly production in the asset’s history. Kearl also delivered record full-year production of 270,000 total gross barrels per day (191,000 barrels Imperial's share).
| __________________________ | ||
1 non-GAAP financial measure - see Attachment VI for definition and reconciliation |
Across other Upstream assets,
In the Downstream, quarterly throughput averaged 407,000 barrels per day with refinery capacity utilization of 94 percent following the successful completion of the largest planned turnaround in
During the quarter, Imperial returned
“Throughout 2023 Imperial has returned over
In November, Imperial released its annual Sustainability report which highlights progress and momentum in the company’s key sustainability focus areas, including the previously announced company-wide net-zero goal in operations through collaboration with government and other industry partners. “Imperial is committed to advancing innovation and strategic partnerships to help address the significant challenge of supplying energy to Canadians in an affordable, secure and sustainable way,” said Corson.
| __________________________ | ||
1 non-GAAP financial measure - see Attachment VI for definition and reconciliation |
Fourth quarter highlights
-
Net income of
$1,365 million $2.47 $1,727 million $2.86
-
Cash flows from operating activities of
$1,311 million $2,797 million $1,799 million $2,452 million
-
Capital and exploration expenditures totalled
$469 million $488 million
-
The company returned
$2,746 million $288 million $958 million $1.5 billion
- Production averaged 452,000 gross oil-equivalent barrels per day, the highest quarterly production in over 30 years when adjusting for the divestment of XTO Energy Canada, up from 441,000 gross oil-equivalent barrels per day in the same period of 2022.
- Total gross bitumen production at Kearl averaged 308,000 barrels per day (218,000 barrels Imperial's share), the highest quarterly production in the asset's history, up from 284,000 barrels per day (201,000 barrels Imperial's share) in the fourth quarter of 2022. Higher production was primarily driven by improved reliability, plant capacity utilization, and increased mine equipment productivity.
-
Gross bitumen production at
Cold Lake averaged 139,000 barrels per day, compared to 141,000 barrels per day in the fourth quarter of 2022.
- Successfully started steam injection at the Cold Lake Grand Rapids Phase 1 (GRP1) project. The initial steam injection phase is expected to last until the end of the first quarter of 2024, with production ramping up over the following months. GRP1 will be the first SA-SAGD project in industry and is expected to achieve 15,000 gross barrels per day of production at full rates while also reducing greenhouse gas emissions intensity by up to 40 percent compared to existing cyclic steam stimulation technology.
- The company's share of gross production from Syncrude averaged 85,000 barrels per day, compared to 87,000 barrels per day in the fourth quarter of 2022.
-
Refinery throughput averaged 407,000 barrels per day, compared to 433,000 barrels per day in the fourth quarter of 2022. Capacity utilization was 94 percent, compared to 101 percent in the fourth quarter of 2022. Fourth quarter 2023 results include impacts from the planned turnaround in
Sarnia , the largest in site history, which was completed under budget and ahead of schedule in October.
- Petroleum product sales were 476,000 barrels per day, compared to 487,000 barrels per day in the fourth quarter of 2022.
-
Chemical net income of
$17 million $41 million
- Released annual Sustainability report which highlights progress and momentum in the company’s key sustainability focus areas, and complements the company’s Advancing Climate Solutions report published in the third quarter of 2023.
| __________________________ | ||
1 non-GAAP financial measure - see Attachment VI for definition and reconciliation |
Recent business environment
Energy markets began to normalize in 2023, down from their 2022 high. While demand for liquids set a record in 2023, supply continued to grow. During the first half of 2023, the price of crude oil declined, impacted by higher inventory levels. In the second half, crude oil prices increased as a result of strong demand, tight inventory levels, and ongoing actions by OPEC+ oil producers to limit supply. In addition, the Canadian WTI/WCS spread began to weaken in the fourth quarter, but remained in line with 2022 on an annual basis. Throughout 2023, strong demand for gasoline and distillate combined with low inventories kept refining margins strong, but short of 2022 levels on an annual basis. In the fourth quarter refining margins dropped due to higher inventory and lower seasonal demand.
Operating results
Fourth quarter 2023 vs. fourth quarter 2022
|
Fourth Quarter |
|
millions of Canadian dollars, unless noted |
2023 |
2022 |
Net income (loss) ( |
1,365 |
1,727 |
Net income (loss) per common share, assuming dilution (dollars) |
2.47 |
2.86 |
Upstream
Net income (loss) factor analysis
millions of Canadian dollars
2022 |
Price |
Volumes |
Royalty |
Other |
2023 |
531 |
30 |
50 |
20 |
139 |
770 |
Price – Average bitumen realizations increased by
Volumes – Higher volumes were primarily driven by improved reliability, plant capacity utilization, and mine equipment productivity at Kearl.
Other – Includes lower operating expenses of about
Marker prices and average realizations
|
Fourth Quarter |
|
Canadian dollars, unless noted |
2023 |
2022 |
West Texas Intermediate (US$ per barrel) |
78.54 |
82.58 |
Western Canada Select (US$ per barrel) |
56.80 |
57.00 |
WTI/WCS Spread (US$ per barrel) |
21.74 |
25.58 |
Bitumen (per barrel) |
64.05 |
59.85 |
Synthetic crude oil (per barrel) |
105.37 |
115.22 |
Average foreign exchange rate (US$) |
0.73 |
0.74 |
Production
|
Fourth Quarter |
|
thousands of barrels per day |
2023 |
2022 |
Kearl (Imperial's share) |
218 |
201 |
|
139 |
141 |
Syncrude (a) |
85 |
87 |
|
|
|
Kearl total gross production (thousands of barrels per day) |
308 |
284 |
(a) In the fourth quarter of 2023, Syncrude gross production included about 1 thousand barrels per day of bitumen and other products (2022 - 2 thousand barrels per day) that were exported to the operator's facilities using an existing interconnect pipeline. |
||
Higher production at Kearl was primarily driven by improved reliability, plant capacity utilization, and mine equipment productivity.
Downstream
Net income (loss) factor analysis
millions of Canadian dollars
2022 |
Margins |
Other |
2023 |
1,188 |
(540) |
(53) |
595 |
Margins – Lower margins primarily reflect weaker market conditions.
Refinery utilization and petroleum product sales
|
Fourth Quarter |
|
thousands of barrels per day, unless noted |
2023 |
2022 |
Refinery throughput |
407 |
433 |
Refinery capacity utilization (percent) |
94 |
101 |
Petroleum product sales |
476 |
487 |
Lower refinery throughput in the fourth quarter of 2023 reflects the impact of planned turnaround activities at
Lower petroleum product sales in the fourth quarter of 2023 were primarily driven by lower wholesale customer volume.
Chemicals
Net income (loss) factor analysis
millions of Canadian dollars
2022 |
Margins |
Other |
2023 |
41 |
(10) |
(14) |
17 |
Corporate and other
|
Fourth Quarter |
|
millions of Canadian dollars |
2023 |
2022 |
Net income (loss) ( |
(17) |
(33) |
Liquidity and capital resources
|
Fourth Quarter |
|
millions of Canadian dollars |
2023 |
2022 |
Cash flows from (used in): |
|
|
Operating activities |
1,311 |
2,797 |
Investing activities |
(411) |
(473) |
Financing activities |
(2,752) |
(2,151) |
Increase (decrease) in cash and cash equivalents |
(1,852) |
173 |
|
|
|
Cash and cash equivalents at period end |
864 |
3,749 |
Cash flows from operating activities primarily reflect unfavourable working capital impacts and lower Downstream margins.
Cash flows used in investing activities primarily reflect higher proceeds from asset sales.
Cash flows used in financing activities primarily reflect:
|
Fourth Quarter |
|
millions of Canadian dollars, unless noted |
2023 |
2022 |
Dividends paid |
288 |
211 |
Per share dividend paid (dollars) |
0.50 |
0.34 |
Share repurchases (a) |
2,458 |
1,934 |
Number of shares purchased (millions) (a) |
30.8 |
27.3 |
(a) Share repurchases were made under the company's normal course issuer bid program for the periods disclosed. Substantial issuer bids were undertaken and commenced on November 4, 2022 (expired on December 9, 2022), and November 3, 2023 (expired on December 8, 2023). Includes shares purchased from Exxon Mobil Corporation concurrent with, but outside of, the normal course issuer bid, and by way of a proportionate tender under the company's substantial issuer bids. |
||
The company completed share repurchases under its normal course issuer bid on October 19, 2023.
On November 3, 2023, the company commenced a substantial issuer bid pursuant to which it offered to purchase for cancellation up to
Full-year 2023 vs. full-year 2022
|
Twelve Months |
|
millions of Canadian dollars, unless noted |
2023 |
2022 |
Net income (loss) ( |
4,889 |
7,340 |
Net income (loss) per common share, assuming dilution (dollars) |
8.49 |
11.44 |
Net income (loss) excluding identified items1 |
4,889 |
7,132 |
Prior year results included favourable identified items1 of
Upstream
Net income (loss) factor analysis
millions of Canadian dollars
2022 |
Price |
Volumes |
Royalty |
Identified Items¹ |
Other |
2023 |
3,645 |
(2,340) |
(70) |
690 |
(208) |
795 |
2,512 |
Price – Lower bitumen realizations were primarily driven by lower marker prices. Average bitumen realizations decreased by
Volumes – Lower volumes were primarily driven by steam cycle timing at
Royalty – Lower royalties were primarily driven by weakened commodity prices.
Identified Items1 – Prior year results included favourable identified items1 related to the company's gain on the sale of interests in XTO Energy Canada.
Other – Includes favourable foreign exchange impacts of about
Marker prices and average realizations
|
Twelve Months |
|
Canadian dollars, unless noted |
2023 |
2022 |
West Texas Intermediate (US$ per barrel) |
77.60 |
94.36 |
Western Canada Select (US$ per barrel) |
58.97 |
76.28 |
WTI/WCS Spread (US$ per barrel) |
18.63 |
18.08 |
Bitumen (per barrel) |
67.42 |
84.67 |
Synthetic crude oil (per barrel) |
105.57 |
125.46 |
Average foreign exchange rate (US$) |
0.74 |
0.77 |
___________________________ |
||
1 non-GAAP financial measure - see Attachment VI for definition and reconciliation |
Production
|
Twelve Months |
|
thousands of barrels per day |
2023 |
2022 |
Kearl (Imperial's share) |
191 |
172 |
|
135 |
144 |
Syncrude (a) |
76 |
77 |
|
|
|
Kearl total gross production (thousands of barrels per day) |
270 |
242 |
(a) In 2023, Syncrude gross production included about 1 thousand barrels per day of bitumen and other products (2022 - 3 thousand barrels per day) that were exported to the operator's facilities using an existing interconnect pipeline. |
||
Higher production at Kearl was primarily driven by improved reliability, plant capacity utilization, and mine equipment productivity.
Downstream
Net income (loss) factor analysis
millions of Canadian dollars
2022 |
Margins |
Other |
2023 |
3,622 |
(1,300) |
(21) |
2,301 |
Margins – Lower margins primarily reflect weaker market conditions.
Other – Higher turnaround impacts of about
Refinery utilization and petroleum product sales
|
Twelve Months |
|
thousands of barrels per day, unless noted |
2023 |
2022 |
Refinery throughput |
407 |
418 |
Refinery capacity utilization (percent) |
94 |
98 |
Petroleum product sales |
471 |
475 |
Lower refinery throughput in 2023 reflects the impact of planned turnaround activities at
Chemicals
Net income (loss) factor analysis
millions of Canadian dollars
2022 |
Margins |
Other |
2023 |
204 |
(30) |
(10) |
164 |
Corporate and other
|
Twelve Months |
|
millions of Canadian dollars |
2023 |
2022 |
Net income (loss) ( |
(88) |
(131) |
Liquidity and capital resources
|
Twelve Months |
|
millions of Canadian dollars |
2023 |
2022 |
Cash flows from (used in): |
|
|
Operating activities |
3,734 |
10,482 |
Investing activities |
(1,694) |
(618) |
Financing activities |
(4,925) |
(8,268) |
Increase (decrease) in cash and cash equivalents |
(2,885) |
1,596 |
Cash flows from operating activities primarily reflect unfavourable working capital impacts, including an income tax catch-up payment of
Cash flows used in investing activities primarily reflect the absence of proceeds from the sale of interests in XTO Energy Canada, and higher additions to property, plant and equipment.
Cash flows used in financing activities primarily reflect:
|
Twelve Months |
|
millions of Canadian dollars, unless noted |
2023 |
2022 |
Dividends paid |
1,103 |
851 |
Per share dividend paid (dollars) |
1.88 |
1.29 |
Share repurchases (a) |
3,800 |
6,395 |
Number of shares purchased (millions) (a) |
48.3 |
93.9 |
(a) Share repurchases were made under the company's normal course issuer bid program for the periods disclosed. Substantial issuer bids were undertaken and commenced on May 6, 2022 (expired on June 10, 2022), November 4, 2022 (expired on December 9, 2022), and November 3, 2023 (expired on December 8, 2023). Includes shares purchased from Exxon Mobil Corporation concurrent with, but outside of, the normal course issuer bid, and by way of a proportionate tender under the company's substantial issuer bids. |
||
On June 27, 2023, the company announced that it had received final approval from the Toronto Stock Exchange for a new normal course issuer bid to continue its then existing share purchase program. The program enabled the company to purchase up to a maximum of 29,207,635 common shares during the period June 29, 2023 to June 28, 2024. The program completed on October 19, 2023 as a result of the company purchasing the maximum allowable number of shares under the program.
On November 3, 2023, the company commenced a substantial issuer bid pursuant to which it offered to purchase for cancellation up to
Key financial and operating data follow.
Forward-looking statements
Statements of future events or conditions in this report, including projections, targets, expectations, estimates, and business plans, are forward-looking statements. Similarly, discussion of emission-reduction future plans to support a net-zero future are dependent on future market factors, such as continued technological progress and policy support, and represent forward-looking statements. Forward-looking statements can be identified by words such as believe, anticipate, intend, propose, plan, goal, seek, estimate, expect, future, continue, likely, may, should, will and similar references to future periods. Forward-looking statements in this report include, but are not limited to, the impact and timing of the Cold Lake Grand Rapids phase 1 project, including expected production and reductions to greenhouse gas emissions intensity, and the timing of steam injection and production ramp-up for such project; the company’s
Forward-looking statements are based on the company's current expectations, estimates, projections and assumptions at the time the statements are made. Actual future financial and operating results, including expectations and assumptions concerning demand growth and energy source, supply and mix; production rates, growth and mix across various assets; project plans, timing, costs, technical evaluations and capacities and the company’s ability to effectively execute on these plans and operate its assets, including the Cold Lake Grand Rapids Phase 1 project and the
These factors include global, regional or local changes in supply and demand for oil, natural gas, and petroleum and petrochemical products and resulting price, differential and margin impacts, including foreign government action with respect to supply levels and prices, and the occurrence of wars; availability and allocation of capital; the receipt, in a timely manner, of regulatory and third-party approvals, including for new technologies that will help the company meet its lower emissions goals; the results of research programs and new technologies, the ability to bring new technologies to commercial scale on a cost-competitive basis, and the competitiveness of alternative energy and other emission reduction technologies; failure, delay or uncertainty regarding supportive policy and market development for the adoption of emerging lower emission energy technologies and other technologies that support emissions reductions; political or regulatory events, including changes in law or government policy, and environmental regulation including climate change, greenhouse gas and low carbon fuel regulation; unanticipated technical or operational difficulties; project management and schedules and timely completion of projects; availability and performance of third-party service providers; environmental risks inherent in oil and gas exploration and production activities; management effectiveness and disaster response preparedness; operational hazards and risks; cybersecurity incidents, including increased reliance on remote working arrangements; currency exchange rates; general economic conditions; and other factors discussed in Item 1A risk factors and Item 7 management’s discussion and analysis of financial condition and results of operations of Imperial Oil Limited’s most recent annual report on Form 10-K and subsequent interim reports.
___________________________ |
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1 non-GAAP financial measure - see Attachment VI for definition and reconciliation |
Forward-looking statements are not guarantees of future performance and involve a number of risks and uncertainties, some that are similar to other oil and gas companies and some that are unique to Imperial Oil Limited. Imperial’s actual results may differ materially from those expressed or implied by its forward-looking statements and readers are cautioned not to place undue reliance on them. Imperial undertakes no obligation to update any forward-looking statements contained herein, except as required by applicable law.
Forward-looking and other statements regarding Imperial's environmental, social and other sustainability efforts and aspirations are not an indication that these statements are necessarily material to investors or requiring disclosure in the company's filings with securities regulators. In addition, historical, current and forward-looking environmental, social and sustainability-related statements may be based on standards for measuring progress that are still developing, internal controls and processes that continue to evolve, and assumptions that are subject to change in the future, including future rule-making. Individual projects or opportunities may advance based on a number of factors, including availability of supportive policy, technology for cost-effective abatement, company planning process, and alignment with our partners and other stakeholders.
In this release all dollar amounts are expressed in Canadian dollars unless otherwise stated. This release should be read in conjunction with Imperial’s most recent Form 10-K. Note that numbers may not add due to rounding.
The term “project” as used in this release can refer to a variety of different activities and does not necessarily have the same meaning as in any government payment transparency reports.
|
Attachment I |
|||
|
|
|
|
|
|
|
|
|
|
|
Fourth Quarter |
Twelve Months |
||
millions of Canadian dollars, unless noted |
2023 |
2022 |
2023 |
2022 |
|
|
|
|
|
Net income (loss) ( |
|
|
|
|
Total revenues and other income |
13,109 |
14,453 |
50,969 |
59,670 |
Total expenses |
11,369 |
12,174 |
44,600 |
50,186 |
Income (loss) before income taxes |
1,740 |
2,279 |
6,369 |
9,484 |
Income taxes |
375 |
552 |
1,480 |
2,144 |
Net income (loss) |
1,365 |
1,727 |
4,889 |
7,340 |
|
|
|
|
|
Net income (loss) per common share (dollars) |
2.47 |
2.87 |
8.51 |
11.47 |
Net income (loss) per common share - assuming dilution (dollars) |
2.47 |
2.86 |
8.49 |
11.44 |
|
|
|
|
|
Other financial data |
|
|
|
|
Gain (loss) on asset sales, after tax |
47 |
— |
63 |
241 |
|
|
|
|
|
Total assets at December 31 |
|
|
41,199 |
43,524 |
|
|
|
|
|
Total debt at December 31 |
|
|
4,132 |
4,155 |
|
|
|
|
|
Shareholders' equity at December 31 |
|
|
22,222 |
22,413 |
|
|
|
|
|
Capital employed at December 31 |
|
|
26,375 |
26,593 |
|
|
|
|
|
Dividends declared on common stock |
|
|
|
|
Total |
278 |
266 |
1,115 |
932 |
Per common share (dollars) |
0.50 |
0.44 |
1.94 |
1.46 |
|
|
|
|
|
Millions of common shares outstanding |
|
|
|
|
At December 31 |
|
|
535.8 |
584.2 |
Average - assuming dilution |
553.7 |
603.0 |
575.9 |
641.5 |
|
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|
|
|
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Attachment II |
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|
|
|
Fourth Quarter |
Twelve Months |
||
millions of Canadian dollars |
2023 |
2022 |
2023 |
2022 |
|
|
|
|
|
Total cash and cash equivalents at period end |
864 |
3,749 |
864 |
3,749 |
|
|
|
|
|
Operating activities |
|
|
|
|
Net income (loss) |
1,365 |
1,727 |
4,889 |
7,340 |
Adjustments for non-cash items: |
|
|
|
|
Depreciation and depletion |
489 |
465 |
1,907 |
1,897 |
(Gain) loss on asset sales |
(54) |
(3) |
(73) |
(158) |
Deferred income taxes and other |
154 |
281 |
(85) |
(77) |
Changes in operating assets and liabilities |
(488) |
345 |
(2,701) |
1,485 |
All other items - net |
(155) |
(18) |
(203) |
(5) |
Cash flows from (used in) operating activities |
1,311 |
2,797 |
3,734 |
10,482 |
|
|
|
|
|
Investing activities |
|
|
|
|
Additions to property, plant and equipment |
(470) |
(492) |
(1,785) |
(1,526) |
Proceeds from asset sales |
57 |
18 |
86 |
904 |
Additional investments |
— |
— |
— |
(6) |
Loans to equity companies - net |
2 |
1 |
5 |
10 |
Cash flows from (used in) investing activities |
(411) |
(473) |
(1,694) |
(618) |
Cash flows from (used in) financing activities |
(2,752) |
(2,151) |
(4,925) |
(8,268) |
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Attachment III |
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|
|
Fourth Quarter |
Twelve Months |
||
millions of Canadian dollars |
2023 |
2022 |
2023 |
2022 |
|
|
|
|
|
Net income (loss) ( |
|
|
|
|
Upstream |
770 |
531 |
2,512 |
3,645 |
Downstream |
595 |
1,188 |
2,301 |
3,622 |
Chemical |
17 |
41 |
164 |
204 |
Corporate and other |
(17) |
(33) |
(88) |
(131) |
Net income (loss) |
1,365 |
1,727 |
4,889 |
7,340 |
|
|
|
|
|
Revenues and other income |
|
|
|
|
Upstream |
4,415 |
4,332 |
16,512 |
19,764 |
Downstream |
14,529 |
15,919 |
55,858 |
64,985 |
Chemical |
329 |
422 |
1,581 |
1,976 |
Eliminations / Corporate and other |
(6,164) |
(6,220) |
(22,982) |
(27,055) |
Revenues and other income |
13,109 |
14,453 |
50,969 |
59,670 |
|
|
|
|
|
Purchases of crude oil and products |
|
|
|
|
Upstream |
1,809 |
1,787 |
6,636 |
7,971 |
Downstream |
12,496 |
13,110 |
47,886 |
55,569 |
Chemical |
206 |
260 |
997 |
1,330 |
Eliminations |
(6,194) |
(6,264) |
(23,120) |
(27,128) |
Purchases of crude oil and products |
8,317 |
8,893 |
32,399 |
37,742 |
|
|
|
|
|
Production and manufacturing |
|
|
|
|
Upstream |
1,187 |
1,438 |
4,917 |
5,491 |
Downstream |
411 |
447 |
1,702 |
1,640 |
Chemical |
74 |
80 |
260 |
273 |
Eliminations |
— |
— |
— |
— |
Production and manufacturing |
1,672 |
1,965 |
6,879 |
7,404 |
|
|
|
|
|
Selling and general |
|
|
|
|
Upstream |
— |
— |
— |
— |
Downstream |
199 |
179 |
693 |
653 |
Chemical |
20 |
23 |
89 |
85 |
Eliminations / Corporate and other |
9 |
55 |
75 |
144 |
Selling and general |
228 |
257 |
857 |
882 |
|
|
|
|
|
Capital and exploration expenditures |
|
|
|
|
Upstream |
240 |
364 |
1,108 |
1,128 |
Downstream |
143 |
94 |
472 |
295 |
Chemical |
12 |
5 |
23 |
10 |
Corporate and other |
74 |
25 |
175 |
57 |
Capital and exploration expenditures |
469 |
488 |
1,778 |
1,490 |
Exploration expenses charged to Upstream income included above |
2 |
1 |
5 |
5 |
|
Attachment IV |
|||
|
|
|
|
|
|
|
|
|
|
Operating statistics |
Fourth Quarter |
Twelve Months |
||
|
2023 |
2022 |
2023 |
2022 |
|
|
|
|
|
Gross crude oil and natural gas liquids (NGL) production |
|
|
|
|
(thousands of barrels per day) |
|
|
|
|
Kearl |
218 |
201 |
191 |
172 |
|
139 |
141 |
135 |
144 |
Syncrude (a) |
85 |
87 |
76 |
77 |
Conventional |
5 |
6 |
5 |
8 |
Total crude oil production |
447 |
435 |
407 |
401 |
NGLs available for sale |
— |
— |
— |
1 |
Total crude oil and NGL production |
447 |
435 |
407 |
402 |
|
|
|
|
|
Gross natural gas production (millions of cubic feet per day) |
30 |
37 |
33 |
85 |
|
|
|
|
|
Gross oil-equivalent production (b) |
452 |
441 |
413 |
416 |
(thousands of oil-equivalent barrels per day) |
|
|
|
|
|
|
|
|
|
Net crude oil and NGL production (thousands of barrels per day) |
|
|
|
|
Kearl |
198 |
184 |
177 |
157 |
|
107 |
105 |
106 |
106 |
Syncrude (a) |
80 |
77 |
67 |
63 |
Conventional |
5 |
6 |
5 |
8 |
Total crude oil production |
390 |
372 |
355 |
334 |
NGLs available for sale |
— |
— |
— |
1 |
Total crude oil and NGL production |
390 |
372 |
355 |
335 |
|
|
|
|
|
Net natural gas production (millions of cubic feet per day) |
29 |
37 |
32 |
83 |
|
|
|
|
|
Net oil-equivalent production (b) |
395 |
378 |
360 |
349 |
(thousands of oil-equivalent barrels per day) |
|
|
|
|
|
|
|
|
|
Kearl blend sales (thousands of barrels per day) |
302 |
277 |
263 |
236 |
|
186 |
186 |
179 |
188 |
NGL sales (thousands of barrels per day) |
— |
— |
— |
1 |
|
|
|
|
|
Average realizations (Canadian dollars) |
|
|
|
|
Bitumen (per barrel) |
64.05 |
59.85 |
67.42 |
84.67 |
Synthetic crude oil (per barrel) |
105.37 |
115.22 |
105.57 |
125.46 |
Conventional crude oil (per barrel) |
33.81 |
67.91 |
59.30 |
97.45 |
NGL (per barrel) |
— |
— |
— |
64.92 |
Natural gas (per thousand cubic feet) |
2.30 |
5.54 |
2.58 |
5.69 |
|
|
|
|
|
Refinery throughput (thousands of barrels per day) |
407 |
433 |
407 |
418 |
Refinery capacity utilization (percent) |
94 |
101 |
94 |
98 |
|
|
|
|
|
Petroleum product sales (thousands of barrels per day) |
|
|
|
|
Gasolines |
229 |
242 |
228 |
229 |
Heating, diesel and jet fuels |
175 |
180 |
176 |
176 |
Lube oils and other products |
43 |
41 |
43 |
47 |
Heavy fuel oils |
29 |
24 |
24 |
23 |
Net petroleum products sales |
476 |
487 |
471 |
475 |
Petrochemical sales (thousands of tonnes) |
170 |
193 |
820 |
842 |
(a) Syncrude gross and net production included bitumen and other products that were exported to the operator’s facilities using an existing interconnect pipeline. |
||||
Gross bitumen and other products production (thousands of barrels per day) |
1 |
2 |
1 |
3 |
Net bitumen and other products production (thousands of barrels per day) |
1 |
2 |
1 |
3 |
(b) Gas converted to oil-equivalent at six million cubic feet per one thousand barrels. |
||||
Attachment V |
||
|
|
|
|
|
|
|
|
Net income (loss) per |
|
Net income (loss) ( |
common share - diluted (a) |
|
millions of Canadian dollars |
Canadian dollars |
|
|
|
2019 |
|
|
First Quarter |
293 |
0.38 |
Second Quarter |
1,212 |
1.57 |
Third Quarter |
424 |
0.56 |
Fourth Quarter |
271 |
0.36 |
Year |
2,200 |
2.88 |
|
|
|
2020 |
|
|
First Quarter |
(188) |
(0.25) |
Second Quarter |
(526) |
(0.72) |
Third Quarter |
3 |
— |
Fourth Quarter |
(1,146) |
(1.56) |
Year |
(1,857) |
(2.53) |
|
|
|
2021 |
|
|
First Quarter |
392 |
0.53 |
Second Quarter |
366 |
0.50 |
Third Quarter |
908 |
1.29 |
Fourth Quarter |
813 |
1.18 |
Year |
2,479 |
3.48 |
|
|
|
2022 |
|
|
First Quarter |
1,173 |
1.75 |
Second Quarter |
2,409 |
3.63 |
Third Quarter |
2,031 |
3.24 |
Fourth Quarter |
1,727 |
2.86 |
Year |
7,340 |
11.44 |
|
|
|
2023 |
|
|
First Quarter |
1,248 |
2.13 |
Second Quarter |
675 |
1.15 |
Third Quarter |
1,601 |
2.76 |
Fourth Quarter |
1,365 |
2.47 |
Year |
4,889 |
8.49 |
(a) Computed using the average number of shares outstanding during each period. The sum of the quarters presented may not add to the year total. |
||
Attachment VI
Non-GAAP financial measures and other specified financial measures
Certain measures included in this document are not prescribed by
Reconciliation of these non-GAAP financial measures to the most comparable GAAP measure, and other information required by these regulations, have been provided. Non-GAAP financial measures and specified financial measures are not standardized financial measures under GAAP and do not have a standardized definition. As such, these measures may not be directly comparable to measures presented by other companies, and should not be considered a substitute for GAAP financial measures.
Cash flows from (used in) operating activities excluding working capital
Cash flows from (used in) operating activities excluding working capital is a non-GAAP financial measure that is the total cash flows from operating activities less the changes in operating assets and liabilities in the period. The most directly comparable financial measure that is disclosed in the financial statements is "Cash flows from (used in) operating activities" within the company’s Consolidated statement of cash flows. Management believes it is useful for investors to consider these numbers in comparing the underlying performance of the company’s business across periods when there are significant period-to-period differences in the amount of changes in working capital. Changes in working capital is equal to “Changes in operating assets and liabilities” as disclosed in the company’s Consolidated statement of cash flows and in Attachment II of this document. This measure assesses the cash flows at an operating level, and as such, does not include proceeds from asset sales as defined in Cash flows from operating activities and asset sales in the Frequently Used Terms section of the company’s annual Form 10-K.
Reconciliation of cash flows from (used in) operating activities excluding working capital
|
Fourth Quarter |
Twelve Months |
||
millions of Canadian dollars |
2023 |
2022 |
2023 |
2022 |
From Imperial's Consolidated statement of cash flows |
|
|
|
|
Cash flows from (used in) operating activities |
1,311 |
2,797 |
3,734 |
10,482 |
|
|
|
|
|
Less changes in working capital |
|
|
|
|
Changes in operating assets and liabilities |
(488) |
345 |
(2,701) |
1,485 |
Cash flows from (used in) operating activities excl. working capital |
1,799 |
2,452 |
6,435 |
8,997 |
Free cash flow
Free cash flow is a non-GAAP financial measure that is cash flows from operating activities less additions to property, plant and equipment and equity company investments plus proceeds from asset sales. The most directly comparable financial measure that is disclosed in the financial statements is "Cash flows from (used in) operating activities" within the company’s Consolidated statement of cash flows. This measure is used to evaluate cash available for financing activities (including but not limited to dividends and share purchases) after investment in the business.
Reconciliation of free cash flow
|
Fourth Quarter |
Twelve Months |
||
millions of Canadian dollars |
2023 |
2022 |
2023 |
2022 |
From Imperial's Consolidated statement of cash flows |
|
|
|
|
Cash flows from (used in) operating activities |
1,311 |
2,797 |
3,734 |
10,482 |
|
|
|
|
|
Cash flows from (used in) investing activities |
|
|
|
|
Additions to property, plant and equipment |
(470) |
(492) |
(1,785) |
(1,526) |
Proceeds from asset sales |
57 |
18 |
86 |
904 |
Additional investments |
— |
— |
— |
(6) |
Loans to equity companies - net |
2 |
1 |
5 |
10 |
Free cash flow |
900 |
2,324 |
2,040 |
9,864 |
Net income (loss) excluding identified items
Net income (loss) excluding identified items is a non-GAAP financial measure that is total net income (loss) excluding individually significant non-operational events with an absolute corporate total earnings impact of at least
Reconciliation of net income (loss) excluding identified items
|
Fourth Quarter |
Twelve Months |
||
millions of Canadian dollars |
2023 |
2022 |
2023 |
2022 |
From Imperial's Consolidated statement of income |
|
|
|
|
Net income (loss) ( |
1,365 |
1,727 |
4,889 |
7,340 |
|
|
|
|
|
Less identified items included in Net income (loss) |
|
|
|
|
Gain/(loss) on sale of assets |
— |
— |
— |
208 |
Subtotal of identified items |
— |
— |
— |
208 |
|
|
|
|
|
Net income (loss) excluding identified items |
1,365 |
1,727 |
4,889 |
7,132 |
Cash operating costs (cash costs)
Cash operating costs is a non-GAAP financial measure that consists of total expenses, less purchases of crude oil and products, federal excise taxes and fuel charge, financing, and costs that are non-cash in nature, including depreciation and depletion, and non-service pension and postretirement benefit. The components of cash operating costs include "Production and manufacturing", "Selling and general" and "Exploration" from the company’s Consolidated statement of income, and as disclosed in Attachment III of this document. The sum of these income statement lines serves as an indication of cash operating costs and does not reflect the total cash expenditures of the company. The most directly comparable financial measure that is disclosed in the financial statements is "Total expenses" within the company’s Consolidated statement of income. This measure is useful for investors to understand the company’s efforts to optimize cash through disciplined expense management.
Reconciliation of cash operating costs
|
Fourth Quarter |
Twelve Months |
||
millions of Canadian dollars |
2023 |
2022 |
2023 |
2022 |
From Imperial's Consolidated statement of income |
|
|
|
|
Total expenses |
11,369 |
12,174 |
44,600 |
50,186 |
Less: |
|
|
|
|
Purchases of crude oil and products |
8,317 |
8,893 |
32,399 |
37,742 |
Federal excise taxes and fuel charge |
621 |
563 |
2,402 |
2,179 |
Depreciation and depletion |
489 |
465 |
1,907 |
1,897 |
Non-service pension and postretirement benefit |
22 |
4 |
82 |
17 |
Financing |
18 |
26 |
69 |
60 |
Cash operating costs |
1,902 |
2,223 |
7,741 |
8,291 |
Components of cash operating costs
|
Fourth Quarter |
Twelve Months |
||
millions of Canadian dollars |
2023 |
2022 |
2023 |
2022 |
From Imperial's Consolidated statement of income |
|
|
|
|
Production and manufacturing |
1,672 |
1,965 |
6,879 |
7,404 |
Selling and general |
228 |
257 |
857 |
882 |
Exploration |
2 |
1 |
5 |
5 |
Cash operating costs |
1,902 |
2,223 |
7,741 |
8,291 |
Segment contributions to total cash operating costs
|
Fourth Quarter |
Twelve Months |
||
millions of Canadian dollars |
2023 |
2022 |
2023 |
2022 |
Upstream |
1,189 |
1,439 |
4,922 |
5,496 |
Downstream |
610 |
626 |
2,395 |
2,293 |
Chemicals |
94 |
103 |
349 |
358 |
Corporate / Eliminations |
9 |
55 |
75 |
144 |
Cash operating costs |
1,902 |
2,223 |
7,741 |
8,291 |
Unit cash operating cost (unit cash costs)
Unit cash operating costs is a non-GAAP ratio. Unit cash operating costs (unit cash costs) is calculated by dividing cash operating costs by total gross oil-equivalent production, and is calculated for the Upstream segment, as well as the major Upstream assets. Cash operating costs is a non-GAAP financial measure and is disclosed and reconciled above. This measure is useful for investors to understand the expense management efforts of the company’s major assets as a component of the overall Upstream segment. Unit cash operating cost, as used by management, does not directly align with the definition of “Average unit production costs” as set out by the
Components of unit cash operating cost
|
Fourth Quarter |
|||||||
|
2023 |
2022 |
||||||
millions of Canadian dollars |
Upstream (a) |
Kearl |
|
Syncrude |
Upstream (a) |
Kearl |
|
Syncrude |
Production and manufacturing |
1,187 |
493 |
276 |
377 |
1,438 |
673 |
327 |
393 |
Selling and general |
— |
— |
— |
— |
— |
— |
— |
— |
Exploration |
2 |
— |
— |
— |
1 |
— |
— |
— |
Cash operating costs |
1,189 |
493 |
276 |
377 |
1,439 |
673 |
327 |
393 |
|
|
|
|
|
|
|
|
|
Gross oil-equivalent production |
452 |
218 |
139 |
85 |
441 |
201 |
141 |
87 |
(thousands of barrels per day) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unit cash operating cost ($/oeb) |
28.59 |
24.58 |
21.58 |
48.21 |
35.47 |
36.39 |
25.21 |
49.10 |
USD converted at the quarterly average forex |
20.87 |
17.94 |
15.75 |
35.19 |
26.25 |
26.93 |
18.66 |
36.33 |
2023 |
||||||||
|
Twelve Months |
|||||||
|
2023 |
2022 |
||||||
millions of Canadian dollars |
Upstream (a) |
Kearl |
|
Syncrude |
Upstream (a) |
Kearl |
|
Syncrude |
Production and manufacturing |
4,917 |
2,097 |
1,144 |
1,533 |
5,491 |
2,353 |
1,344 |
1,563 |
Selling and general |
— |
— |
— |
— |
— |
— |
— |
— |
Exploration |
5 |
— |
— |
— |
5 |
— |
— |
— |
Cash operating costs |
4,922 |
2,097 |
1,144 |
1,533 |
5,496 |
2,353 |
1,344 |
1,563 |
|
|
|
|
|
|
|
|
|
Gross oil-equivalent production |
413 |
191 |
135 |
76 |
416 |
172 |
144 |
77 |
(thousands of barrels per day) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unit cash operating cost ($/oeb) |
32.65 |
30.08 |
23.22 |
55.26 |
36.20 |
37.48 |
25.57 |
55.61 |
USD converted at the YTD average forex |
24.16 |
22.26 |
17.18 |
40.89 |
27.87 |
28.86 |
19.69 |
42.82 |
2023 |
||||||||
(a) Upstream includes Imperial's share of Kearl, |
||||||||
After more than a century, Imperial continues to be an industry leader in applying technology and innovation to responsibly develop Canada’s energy resources. As Canada’s largest petroleum refiner, a major producer of crude oil, a key petrochemical producer and a leading fuels marketer from coast to coast, our company remains committed to high standards across all areas of our business.
Source: Imperial
View source version on businesswire.com: https://www.businesswire.com/news/home/20240202723854/en/
Investor Relations
(587) 962-4401
Media Relations
(587) 476-7010
Source: Imperial
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