10-QPeriod: Q1 FY2024

OCCIDENTAL PETROLEUM CORP /DE/ Quarterly Report for Q1 Ended Mar 31, 2024

Filed May 7, 2024For Securities:OXYOXY-WT

Summary

Occidental Petroleum Corporation (OXY) reported its first-quarter 2024 financial results, showing a decrease in net sales and net income compared to the prior year, largely driven by lower commodity prices and reduced production volumes, particularly in the oil and gas segment. While revenue declined, the company generated positive operating cash flow, demonstrating continued operational strength. The company's strategic priorities for 2024 include maintaining its production base, delivering a sustainable dividend, enhancing its asset base with new investments, advancing low-carbon initiatives, reducing leverage, and completing the significant CrownRock acquisition. The CrownRock acquisition, a key focus for the company, is progressing with regulatory reviews underway, and Occidental has secured committed financing for the transaction. Management expects the acquisition to be immediately cash flow accretive upon closing.

Financial Highlights

47 data points
Beta

Revenue

$5.97B

86.1% Gross Margin

Net Income

$888.00M

14.9% Net Margin

EPS (Diluted)

$0.75

Total Assets

$74.28B

Cash & Equivalents

$1.27B

Free Cash Flow

$224.00M

Financial Statements
Beta
Revenue$5.97B
Cost of Revenue$828.00M
Gross Profit$5.15B
SG&A Expenses$259.00M
Net Income$888.00M
EPS (Basic)$0.81
EPS (Diluted)$0.75
Shares Outstanding (Basic)884.10M
Shares Outstanding (Diluted)948.60M

Key Highlights

  • 1Net sales decreased to $5.975 billion in Q1 2024 from $7.225 billion in Q1 2023, primarily due to lower commodity prices and volumes in the oil and gas segment.
  • 2Net income attributable to common stockholders declined to $718 million ($0.75 per diluted share) in Q1 2024, down from $983 million ($1.00 per diluted share) in Q1 2023.
  • 3Operating cash flow remained robust at $2.0 billion for Q1 2024, although lower than $2.9 billion in Q1 2023, reflecting the impact of market conditions.
  • 4Capital expenditures were $1.8 billion for Q1 2024, an increase from $1.5 billion in Q1 2023, reflecting investments in property, plant, and equipment, including costs related to the planned CrownRock acquisition.
  • 5The company declared and paid $197 million in common stock dividends during Q1 2024, maintaining its commitment to shareholder returns.
  • 6The planned acquisition of CrownRock is progressing, with regulatory reviews ongoing and fully committed financing secured, aiming to strengthen Occidental's Permian Basin portfolio.
  • 7Occidental continues to advance its low-carbon ventures, contributing to its long-term strategy alongside its core energy and chemical businesses.

Frequently Asked Questions

The primary drivers for the decrease in revenue and net income were lower commodity prices for oil, NGLs, and natural gas, coupled with reduced domestic crude oil volumes. A third-party production shut-in in the Eastern Gulf of Mexico also contributed to lower volumes. Lower realized caustic soda prices in the chemical segment also impacted overall performance.

Occidental is proceeding with the CrownRock acquisition, which is subject to customary closing conditions and regulatory approval, including the HSR Act review. The company has secured committed financing for the transaction and expects it to be immediately cash flow accretive, strengthening its U.S. onshore portfolio with premier Permian Basin assets.

Occidental is committed to delivering a sustainable and growing dividend, as evidenced by the $197 million in common stock dividends declared in Q1 2024. The company also aims to further reduce long-term financial leverage and has a remaining share repurchase authorization of approximately $1.2 billion. Debt maturities are manageable, and the company expects sufficient liquidity to meet its obligations.

Occidental's 2024 priorities include maintaining its production base, delivering a sustainable and growing dividend, enhancing its asset base through investments in energy, chemicals, and low-carbon businesses, advancing low-carbon technologies, further reducing long-term financial leverage, and successfully completing the CrownRock acquisition.