Summary
Devon Energy Corp. reported improved financial results for the six months ended June 30, 2017, compared to the same period in 2016. The company achieved a net profit of $990 million, a significant turnaround from a net loss of $4.6 billion in the prior year. This improvement was driven by a substantial increase in commodity prices, which positively impacted revenues and realized prices. Despite a decrease in production volumes due to strategic capital reductions in 2016 and asset divestitures, the company's focus on operational efficiency and cost management, including a $190 million reduction in LOE, G&A, and financing costs, contributed to the improved profitability. Devon's liquidity remains strong, with $2.4 billion in cash and cash equivalents and $3 billion in available credit as of June 30, 2017. The company is executing a $1 billion asset divestiture program, focusing on non-core assets to further strengthen its financial position and accelerate its transition to higher-margin production. Key strategic priorities for the remainder of the year include continued development in the STACK and Delaware Basin, organic funding of capital programs, execution of asset divestitures, and enhancing financial strength.
Financial Highlights
45 data points| Revenue | $2.17B |
| Operating Expenses | $2.73B |
| Operating Income | $542.00M |
| Interest Expense | $98.00M |
| Net Income | $219.00M |
| EPS (Basic) | $0.41 |
| EPS (Diluted) | $0.41 |
| Shares Outstanding (Basic) | 520.00M |
| Shares Outstanding (Diluted) | 523.00M |
Key Highlights
- 1Net earnings improved significantly to $990 million for the first six months of 2017, compared to a net loss of $4.6 billion in the same period of 2016, primarily due to higher commodity prices.
- 2Total revenues and other increased by 47.7% to $6.82 billion for the first six months of 2017 from $4.61 billion in the prior year.
- 3Operating cash flow saw a substantial increase of 222% to $1.64 billion for the first six months of 2017, up from $510 million in 2016.
- 4The company announced a $1 billion divestiture program for non-core upstream assets, aiming to focus on higher-margin production and strengthen its financial position.
- 5Devon maintained strong liquidity, with $2.369 billion in cash and cash equivalents and significant available credit, while reducing total debt by 17% to $10.56 billion.
- 6Production volumes decreased by 17% for the six-month period, reflecting the impact of reduced capital investment in 2016 and asset divestitures, but the company anticipates higher-margin production to exit 2017 at an increased rate.
- 7Average realized prices per Boe increased by 60% to $25.28 for the first six months of 2017, compared to $15.78 in the prior year, excluding derivative impacts.