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ConocoPhillips 8-K Report, Financial Results (Feb 8, 2024)

Reports
Earnings & Results·Exhibits & Filings
Filing Date
Filed February 8, 2024
Period End
February 8, 2024
Security
COP
In the record · 2016–202610-K1110-Q338-K108

COP filed 11 annual reports (10-K), 33 quarterly reports (10-Q) and 108 current reports (8-K) between 2016 and 2026.

  1. Impairment8-K · Jun ’17Jun ’17
  2. Deal closed8-K · Jan ’21Jan ’21
  3. Leadership change8-K · Nov ’22Nov ’22
  4. Leadership change8-K · Aug ’26Aug ’26

01—Abstract

Summary

Summary of the 8-K filed February 8, 2024. Cited figures are marked; the original filing is the authoritative source.

ConocoPhillips (COP) reported fourth-quarter 2023 earnings of $3.0 billiona, or $2.52 per share, versus $3.2 billion ($2.61 per share) a year earlier, and adjusted earnings of $2.9 billion ($2.40 per share) versus $3.4 billion ($2.71 per share).

For full-year 2023, GAAP earnings were $11.0 billionb ($9.06 per share) and adjusted earnings were $10.6 billion ($8.77 per share), both down meaningfully from 2022 as realized prices fell 27% to $58.39 per BOE. Production was a bright spot, reaching a record 1,826 MBOED for the year, and the company generated $21.3 billion of cash from operations (CFO) while returning $11.0 billion to shareholders. Notably, the company's 2023 cash flow was supported by $2.7 billion spent to acquire the remaining 50% of Surmont and $0.6 billion of disposition proceeds, and its 2023 capital expenditures and investments totaled $11.2 billion.

Looking ahead, ConocoPhillips announced a planned 2024 return of capital of $9 billionc, a reduction from the $11.0 billion returned in 2023, and guided to 2024 production of 1.91 to 1.95 MMBOED with total capital expenditures of $11.0 to $11.5 billion. The company declared a quarterly ordinary dividend of $0.58 per share plus a variable return of cash (VROC) of $0.20 per share, both payable March 1, 2024. Preliminary year-end 2023 proved reserves were 6.8 billion BOE, with a reserve replacement ratio of 123%, and the final figures will appear in the Form 10-K.

Investors should note that the 2024 guidance redefines adjusted operating costs to exclude certain exploration items, which makes year-over-year cost comparisons less direct. The filing also highlights progress on the company's long-term growth and energy transition agenda, including the Willow project FID in Alaska, FID on Port Arthur LNG, expanded Qatar LNG activity, and an accelerated 2030 GHG emissions-intensity reduction target of 50-60%d (from 40-50%) against a 2016 baseline. Overall, the results reflect a company with strong operating scale and cash generation that is navigating lower commodity prices through disciplined capital allocation and shareholder returns.

02—Key points

Key Highlights

  1. Q4 2023 GAAP earnings of $3.0B ($2.52/share) vs. $3.2B ($2.61/share) in Q4 2022; adjusted Q4 earnings of $2.9B ($2.40/share) vs. $3.4B ($2.71/share).
  2. FY2023 GAAP earnings of $11.0B ($9.06/share) and adjusted earnings of $10.6B ($8.77/share), down from $18.7B and $17.3B respectively in 2022.
  3. Record full-year 2023 production of 1,826 MBOED; Q4 2023 production of 1,902 MBOED, up 144 MBOED year over year (up 4% on a pro forma underlying basis).
  4. FY2023 total average realized price fell 27% to $58.39/BOE, reflecting lower commodity prices.
  5. Generated $21.3B of CFO in 2023 and returned $11.0B to shareholders ($5.6B dividends and VROC, $5.4B buybacks).
  6. 2024 planned return of capital of $9B; 2024 production guidance of 1.91-1.95 MMBOED and capital expenditures of $11.0-11.5B.
  7. Preliminary year-end 2023 proved reserves of 6.8 BBOE with a 123% reserve replacement ratio; accelerated 2030 GHG intensity reduction target to 50-60%.

03—Questions

Frequently Asked Questions

  1. How much is ConocoPhillips planning to return to shareholders in 2024, and how does that compare with 2023?

    ConocoPhillips plans to return $9 billion to shareholders in 2024. That is lower than the $11.0 billion returned in 2023, which consisted of $5.6 billion in ordinary dividends and VROC and $5.4 billion in share repurchases.

  2. What dividend was declared, and when is it payable?

    The board declared an ordinary dividend of $0.58 per share and a variable return of cash (VROC) of $0.20 per share. Both are payable March 1, 2024, to stockholders of record at the close of business on February 19, 2024.

  3. Why did earnings decline in 2023 despite record production?

    Earnings fell primarily because realized prices dropped sharply. The company's average realized price was $58.39 per BOE in 2023, 27% below 2022's $79.82, which more than offset the benefit of higher production volumes.

  4. What are the key 2024 operating and financial guidance figures?

    For 2024, ConocoPhillips guided to total production of 1.91-1.95 MMBOED (Q1 2024: 1.88-1.92 MMBOED), total capital expenditures of $11.0-11.5 billion, adjusted operating costs of $8.9-9.1 billion, and DD&A of $9.4-9.6 billion. Guidance excludes special items.

  5. Does the 2024 cost guidance change the basis for comparison with 2023?

    Yes. Beginning in 2024, adjusted operating costs no longer include exploration G&A, geological and geophysical expenses, and lease rentals. Those items totaled about $0.2 billion in 2023, so the 2024 guidance is not directly comparable to the 2023 adjusted operating cost figure of $8.4 billion without adjustment.

04—Continue

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