Cenovus Energy, backed by CK Hutchison (0001) and the Li Ka-shing family, is on track to achieve an upstream monthly production milestone in excess of one million BOE/d this month, with cash flow surging 1.37 times year on year.
Jon McKenzie, Cenovus's president and chief executive, said that through positive upstream and downstream performances, the company delivered its best-ever quarterly financial results, boosted by higher commodity prices and strong operational performance, with cash flow rising 137 percent year on year to C$5.64 billion (HK$31.48) and 1.58 times quarter on quarter to C$2.18 billion
The Canadian integrated oil and natural gas company declared a quarterly dividend of C$0.22 per share. In the second quarter, it returned C$1.4 billion to shareholders – C$1.0 billion from buying 26.2 million shares via its issuer bid and C$0.4 billion in dividends.
It also highlighted its operating performance, with total revenue rising 40.32 percent quarter on quarter to C$17.4 billion. Operating margin was C$5.9 billion, up 34.09 percent.
Operating margin in the U.S. Refining segment was C$771 million, which included a C$152 million inventory holding gain.
Its upstream revenues increased 34.04 percent to C$12.6 billion. Higher benchmark oil prices and strong cost discipline also drove the upstream operating margin up by 32.43 percent to C$4.9 billion. Total Upstream production was 970.4 MBOE/d, compared to 972.1 MBOE/d in the first quarter.
Downstream revenues were C$8.2 billion, an increase from C$5.6 billion in the first quarter. Strong market crack spreads and upgrading differentials pushed the downstream operating profit up by 29.84 percent to C$953 million. Total Downstream crude throughput fell by 1.53 percent to 451.5 Mbbls/d.
The company said its C$2.2 billion outstanding on the term loan facility in acquiring MEG Energy was fully repaid and canceled.
