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Despite a drop in oil and gas prices, Chevron Corporation (NYSE: CVX) beat analyst expectations in its first-quarter earnings, which rose on the back of higher margins on refined product sales.
Chevron on Friday reported earnings of $6.6 billion, or $3.46 per diluted share, for the first quarter of 2023. This compares with $6.3 billion in earnings, or $3.22 per diluted share, for the first quarter of 2022. Chevron’s total earnings were also higher than the $6.35 billion profit for the fourth quarter of 2022.
The Q1 2023 earnings per share of $3.46 beat the $3.40 analyst consensus estimate compiled by The Wall Street Journal.
Chevron’s upstream earnings were lower than a year ago, mostly due to lower realizations on the back of the decline in commodity prices.
The downstream business, however, posted strong results due to higher margins on refined product sales, and higher sales overall, thanks to higher demand for jet fuel as restrictions from the pandemic continue to ease. The U.S. downstream business booked earnings of $977 million for Q1, double from a year ago, while the international downstream earned $823 million, up from $591 million in Q4 and from a loss of $155 million for the first quarter of 2022.
Sales and other operating revenues stood at $48.8 billion for the first quarter of 2023, compared to $52.3 billion in the year-ago period, primarily due to lower commodity prices.
Chevron’s capex in the first three months of 2023 was up 55% from a year ago, primarily due to higher investment in the United States.
“We’re delivering strong financial results and increasing cash returned to shareholders,” Chevron’s chairman and CEO Mike Wirth said, commenting on the results.
Chevron returned $6.6 billion to shareholders in the first quarter, up by 65% from last year. Shareholder returns in Q1 included dividends of $2.9 billion and share repurchases of $3.75 billion, the supermajor said, adding that it expects to repurchase $4.375 billion in shares in the second quarter of 2023.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.