ConocoPhillips (COP) Q4 2023 earnings summary

Executive summary

• FY23 earnings were $11.0B, or $9.06/share; adjusted earnings were $10.6B, or $8.77/share, down from $18.7B and $17.3B, respectively, in FY22.

• Record FY23 production reached 1,826 MBOED, including a record 1,067 MBOED in the Lower 48; preliminary proved reserves were 6.758 BBOE, with a 123% reserve replacement ratio.

• Returned $11.0B to shareholders in FY23 and set a $9.0B return-of-capital target for 2024.

Financial highlights

• Q4’23 earnings were $3.0B, or $2.52/share, versus $3.2B, or $2.61/share, in Q4’22; adjusted earnings were $2.862B, or $2.40/share, versus $3.375B, or $2.71/share.

• FY23 cash provided by operating activities was $20.0B; it was $21.3B excluding a $1.4B working-capital change, with $0.6B of disposition proceeds. Free cash flow was $10.1B.

• Q4’23 cash provided by operating activities was $5.3B; it was $5.5B excluding a $0.2B working-capital change. Free cash flow was ~$2.6B.

• Cash and short-term investments totaled $6.9B at year-end 2023.

Outlook and guidance

• FY24 production guidance is 1.91–1.95 MMBOED; Q1’24 guidance is 1.88–1.92 MMBOED.

• FY24 guidance includes capital expenditures of $11.0B–$11.5B, including $0.2B–$0.3B of capitalized interest; adjusted operating costs of $8.9B–$9.1B and DD&A of $9.4B–$9.6B.

• FY24 adjusted corporate segment net loss guidance is $1.0B–$1.1B; guidance excludes special items.

• Capital guidance includes $0.9B–$1.0B for Willow and $0.5B–$0.6B for LNG; expected deflation contribution is $0.2B–$0.3B.

• Planned FY24 return of capital is $9.0B; declared ordinary dividend of $0.58/share and VROC of $0.20/share, payable March 1, 2024.