Marathon Oil (MRO) Q3 2024 earnings summary

Executive summary

• Q3 2024 net income was $287 million, down from $453 million in Q3 2023, mainly due to lower crude and natural gas price realizations and a $75 million deferred tax valuation allowance against foreign tax credits.

• Adjusted net income for Q3 2024 was $360 million ($0.64 per diluted share), reflecting adjustments for non-core items.

• Net operating cash flow reached $1.21 billion, with adjusted CFO at $1.04 billion before working capital changes.

• The merger with ConocoPhillips is expected to close in late Q4 2024, with share repurchases discontinued and $6 million in Q3 and $16 million year-to-date in transaction costs.

• Capital expenditures for the first nine months of 2024 were $1.73 billion, with Q3 capex at $458 million and a raised annual oil production guidance midpoint to 192 mbopd.

Financial highlights

• Q3 2024 revenues and other income: $1.79 billion, down from $1.81 billion in Q3 2023.

• Net income for Q3 2024: $287 million ($0.51 per diluted share); adjusted net income per share was $0.64.

• Operating cash flow for the first nine months: $3.05 billion, up 2% year-over-year.

• Free cash flow was $659 million; adjusted free cash flow was $589 million, including Equatorial Guinea distributions.

• Dividends paid in the first nine months: $188 million; share repurchases totaled $516 million before suspension.

Outlook and guidance

• 2024 capital budget set at $1.9–$2.1 billion, with restrictions on expansion due to the merger agreement.

• Annual oil production guidance midpoint raised to 192 mbopd and oil equivalent production to 393 mboed.

• Q4 oil production expected to moderate to 190 mbopd due to capital program phasing.

• Sequential increase in free cash flow expected in Q4 on a price-normalized basis.

• Expectation of continued commodity price volatility due to global market dynamics.