Pioneer Natural Resources Company PXD reported third-quarter 2015 adjusted loss of 1 cent per share, narrower than the Zacks Consensus Estimate of a loss of 7 cents.
However, the bottom line compared unfavourably with the year-earlier adjusted income of $1.35 per share. The deterioration mainly stemmed from lower price realizations.
Revenues and other income in the quarter surged 46.6% year over year to $2,218 million from $1,513 million. The top line also comfortably surpassed the Zacks Consensus Estimate of $767 million.
Production
Total production in the reported quarter averaged approximately 210.7 thousand barrels of oil equivalent per day (MBOE/d), up 13.2% year over year. The improvement was attributable to robust yield from core growth assets – Spraberry field and Wolfcamp Shale.
Oil production averaged 109.1 thousand barrels per day (MBbl/d), an improvement of 22.6% year over year. Natural gas liquids (NGLs) production rose 4.5% year over year to 41.6 MBbl/d. Natural gas production increased to 360.0 million cubic feet per day (MMcf/d) from the year-ago level of 343.7 MMcf/d.
Price Realization
On an oil equivalent basis, the average realized price was $28.75 per barrel in the reported quarter compared with $56.51 in the year-ago quarter. The average realized price for oil was $42.46 per barrel as against $90.82 in third-quarter 2014.
Average natural gas price decreased 33.2% year over year to $2.53 per thousand cubic feet (Mcf). Natural gas liquids were sold at $12.39 per barrel, down from $28.44 in the year-ago quarter.
Cash and Debt
At the end of the quarter under review, cash balance was $581 million. Long-term debt was $2,675 million, which represents a debt-to-capitalization ratio of 23% (as against 24.3% in the preceding quarter).
Capital Outlay
For 2015, Pioneer reiterated its capital spending budget at $2.2 billion.
Of this, the company has apportioned drilling capex of $1.95 billion and capital for the development of Spraberry/Wolfcamp water infrastructure and vertical integration of $250 million.
An amount of $1,400 million has been allocated for the development of northern Spraberry/Wolfcamp area. Another $120 million has been set aside to develop the southern Wolfcamp joint venture area. The company will invest $390 million in Eagle Ford Shale and spend $40 million for other asset developments.
Guidance
Pioneer expects production to average between 206 MBOE/d and 211 MBOE/d for the fourth quarter of 2015.
Production costs are expected between $11.00 per BOE and $13.00 per BOE. Depletion, depreciation and amortization expenses are expected to average between $18.50 per BOE and $20.50 per BOE.
The projected range is $80–$85 million for general and administrative expenses, $45–$50 million for interest expenses and $40–$50 million for other expenses. The expected tax rate is 35–40%.
Zacks Rank
Currently, Pioneer carries a Zacks Rank #3 (Hold).
Some better-ranked players from the oil and gas exploration and production industry are Natural Gas Services Group Inc. NGS, Midcoast Energy Partners, L.P. MEP and Seadrill Partners L.P SDLP. Each of these stocks sports a Zacks Rank #1 (Strong Buy).
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