Stockwatch – Cenovus Energy Marks Record Cash Flow in Q2

Stockwatch – Independent oil producer Cenovus Energy Inc (TSE:CVE, Mkt cap 25.30B, P/E 21.58, Div/yield 0.27/3.19, EPS 1.55, Shares 756.94M) recently published its results for the second quarter of this year, which ended on June 30. Brian Ferguson, president and CEO of the firm, pointed out in the announcement that the company had generated record cash flow during the period – a jump of 37% or $1.19 billion.

Cenovus Grand Rapids SAGD Total

Stockwatch – Cenovus Energy generates record cash flow

The increased cash flow was aided by 34% higher operating cash flow from Cenovus’s oil and natural gas-producing assets. This, in turn, could be explained with the year-over-year increase in oil sands production, as well as the higher prices of crude oil and natural gas.

Cenovus generated a net income of $615 million – net earnings more than tripled compared to the same period last year. Higher operating earnings and a non-operating unrealised foreign exchange gain in the amount of $177 million contributed to the increase. The company’s operating profits saw a rise as well, up 85% to $473 million.

Cenovus said increased production at its Christina Lake oil sands project served as a boost to its second quarter profits. Christina Lake production marked a 77% rise from the second quarter in 2013, averaging almost 68,000 barrels per day net.

Production at the company’s other sand project, Foster Creek, rose 3% compared to the same period in 2013, averaging nearly 57,000 barrels per day net.

John Brannan, Cenovus Energy’s executive vice-president & chief operating Officer, noted in the announcement that the marked growth in oil sands production, as well as the robust cash flow coming from the company’s conventional and refining assets, serve to show that Cenovus Energy’s integrated business strategy really works.

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