Canadian Natural Resources Ltd., one of Canada's largest oil sands and natural gas producers, raised its dividend and reported a nearly threefold increase in fourth-quarter profits Thursday as stronger production helped offset slumping crude-oil prices.
The Calgary-based company said quarterly net earnings climbed to 1.20 billion Canadian dollars ($966 million), or C$1.09 a share, from C$413 million, or 38 Canadian cents, a year earlier.
Adjusted to exclude items, earnings rose to 69 Canadian cents a share from 52 Canadian cents, beating the 67 Canadian cents a share analysts polled by Thomson Reuters expected.
Canadian Natural, which raised its dividend by half a cent to 23 Canadian cents a share, is bucking the trend of some of its North American oil and gas producing peers who have seen their profit margins wither from an energy commodity glut.
"Although we were faced with new crude oil pricing challenges in the fourth quarter of 2014, we have been able to adapt quickly to the changing conditions through our nimble, flexible capital allocation," President Steve Laut said in the company's earnings statement.
Canadian Natural said cash flow rose 33% to C$2.37 billion as overall production climbed to 860,920 barrels of oil equivalent a day from 677,242 barrels a day a year earlier. For the full year, production rose nearly 18% to 790,410 barrels of oil equivalent a day.
Production got a boost from the company's purchase last year of Devon Energy Corp.'s western Canadian natural gas and light oil assets for C$3.1 billion.
In January, Canadian Natural cut its capital spending to C$6.2 billion and lowered its production guidance for 2015 due to slumping oil prices. At that time, it said it would further curtail spending if required.
The company on Thursday shaved another C$150 million from its planned capital budget for the year, to about C$6.04 billion, citing a reduction in the number of planned maintenance turnaround days scheduled at its Horizon oil-sands operation. It said it expects to bolster Horizon output by about 10,000 barrels a day by reducing the planned outage to six days from 35.
Overall production for 2015 is targeted at 850,000 to 897,000 barrels of oil equivalent a day, including crude oil and natural-gas liquids production of between 562,000 and 602,000 barrels a day.
To cut costs, the company said members of its management committee have agreed to a 10% salary reduction, effective March 1, and board members have agreed to reduce their annual cash retainer by 10%.
"Strong cost management and prudent financial discipline continue to remain our focus given the volatility in commodity prices," Chief Financial Officer Corey Bieber said in a statement.
