Fourth Quarter 2017 Earnings: Here is How Oil and Gas Companies Performed in 2017

Supported by the recent rally in oil and gas prices, most of the major international oil companies and oil and gas services companies reported strong financial performance and higher profits particularly during fourth quarter 20017 as well as the full year of 2017. The latest fourth quarter earning results from both the majors and oil and gas services companies come amid a rapidly improving oil and gas market environment as oil prices increased more than 50 percent since middle of 2017 reaching new highs not seen in three years.

Here is a summary of the fourth quarter 2017 earnings results of major international oil companies and oil and gas services companies that were published so far:

1- Major International Oil Companies:

1.1  ExxonMobil

ExxonMobil earnings for fourth quarter 2017 came at 8.4 billion, an increase of 6.7 billion compared to 2016 fourth quarter earnings of around 1.7 billion. Similarly, ExxonMobil full-year 2017 earnings came at 19.7 billion, with an increase of $11.9 billion from 2016 earnings of around 7.84 billion. The improved earnings for ExxonMobil were due to U.S. Tax reforms, improved upstream results and downstream margins.

ExxonMobil Fourth Quarter 2017 Earnings Result

1.2  Chevron

Driven by lower CAPEX and OPEX, new production and better oil prices, Chevron performed better in 2017 than it did in 2016. Chevron reported earnings of $3.1 billion for fourth quarter 2017, compared with $415 million in the fourth quarter of 2016. Chevron full-year 2017 earnings were $9.2 billion, compared with $497 million in loss during 2016.

Chevron Fourth Quarter 2017 Earnings Result

1.3  Shell

2017 was a good year for Shell as well. Aimed improving oil market environment, the Anglo-Dutch firm had posted a strong financial performance during 2017. Shell reported its fourth quarter net earnings of around $4.3 billion, an increase of 140 percent compared to its earnings during the same quarter a year ago. Shell full-year 2017 net earnings came at 15.8 billion, an increase of 119 percent compared to last year.

 Shell Fourth Quarter 2017 Earnings Result

1.4  ConocoPhillips

ConocoPhillips reported fourth quarter 2017 earnings of $1.6 billion, compared with net loss of $35 million during fourth quarter 2016. Fourth quarter 2017 adjusted earnings were $0.5 billion, compared with a net loss of $0.3 billion in fourth quarter 2016. ConocoPhillips full-year 2017 earnings were a net loss of $0.9 billion, or ($0.70) per share, compared with a full-year 2016 net loss of $3.6 billion, or ($2.91) per share. Excluding special items, full-year 2017 adjusted earnings were $0.7 billion, or $0.60 per share, compared with a full-year 2016 adjusted net loss of $3.3 billion, or ($2.66) per share.

ConocoPhillips Fourth Quarter 2017 Earnings Result 

1.5  Total

Total adjusted net income for the whole year of 2017 came at 10.6 billions, an increase of 28 percent compared to 2016. Total’s fourth quarter 2017 earnings were 2.9 billions, an increase in its fourth quarter earning for 2017 by 19 percent from the fourth quarter in 2016.

Total strong financial results were driven by the launch of five upstream projects in 2017 which contributed to production growth of  five percent in 2017, maintained financial discipline and cost savings of 3.7 billions in 2017.

Takeaways:

• A strong financial performance for the majors in 2017
• Accelerating growth momentum and strengthening financial framework
• The current focus is on growing cash flow and delivering shareholder value
• Increased focus on LNG projects and unconventional resources (continue to maximize capital efficiency)
• Improved projects execution as projects economics improve (strong project execution in challenging environment)
• Pursuing advanced strategic opportunities that are foundational for future growth
• Starting up major projects and an increased focus on production growth
• Increased focus on value and portfolio divestment
• Focus on lowest-of-cost-supply developments

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2- Oil & Gas Services Companies

2.1  Schlumberger

As always, Schlumberger, the world’s largest oil service company delivered solid Q4 results for 2017:
Fourth Quarter Revenue: $8.2 billion – an increase of 3 percent sequentially.
2017 Full Year Revenue: $30.4 billion – an increase of 9 percent from the previous year.

Revenue growth was driven by acquired Cameron businesses, land activities in North America, and strong activities in Saudi Arabia and Latin America. Production segment appears to be the revenue growth driver among the rest business segments.

Note: As Schlumberger restructures its product lines aimed long-term financial growth, the company decided to exit seismic acquisition business.

Schlumberger Fourth Quarter 2017 Earnings Result

2.2  Baker Hughes

As a GE company, Baker Hughes has made a strong progress in improving margins and generating cash flow. The company reported a $5.8 billion in revenue for the fourth quarter of 2017, an increase of 7 percent sequentially and 3 year-over-year. BHGE delivered a full-year 2017 revenue of 21.9 billion.

BHGE Fourth Quarter 2017 Earnings Result

2.3  Halliburton

In its fourth quarter earnings report, Halliburton reported a loss from continuing operations of $805 million, or $0.92 per diluted share, for the fourth quarter of 2017. The company’s total revenue in the fourth quarter of 2017 was $5.9 billion, a 9% increase from revenue of $5.4 billion in the third quarter of 2017. Total revenue for the full year of 2017 was $20.6 billion, an increase of $4.7 billion, or 30%, from 2016.

Halliburton Fourth Quarter 2017 Earnings Result

2.4  Weatherford

In its fourth quarter earnings report, Weatherford reported a net loss of $1.4 billion, a loss of $1.95 per share for the fourth quarter 2017. The company’s revenue for the fourth quarter 2017 was $1.49 billion, an increase of 2 percent from the third quarter 2017 revenue of $1.46 billion, and 6 percent increase form the revenue of fourth quarter 2016 of around $1.41 billion.

Weatherford full-year 2017 revenue was $5.70 billion, slightly down by 1 percent or $50 million from 2016 revenue. the company’s full year operating loss for 2017 came at $2.13 billion, compared to a loss of $2.25 billion in 2016. Weatherford Fourth Quarter 2017 Earnings Result

Takeaways:

• Better earning for oil and gas services companies in 2017 than the year before
• Strengthening technology offerings and market presence in key markets around the world
• Companies business restructuring to meet customers’ changing priorities and buying habits
• Adjusting strategy to suit market conditions and customers needs
• Integrating equipment and services modules
• Positioning for growth and profitability
• Reducing products and services cost