Stockwatch – Calgary-based oil and gas company Suncor Energy Inc. (TSE:SU, Mkt cap 62.12B, P/E 16.43, Div/yield 0.28/2.64, EPS 2.58, Shares 1.47B) announced its financial results for the second quarter of 2014 at the end of July. The results indicate a sharp drop in net income – $211 million, down from $680 million in 2013’s second quarter.
However, the company marks a strong quarter when it comes to operating earnings – for 2014’s second quarter they stand at $1.135 billion (or $0.77 per common share), compared to $934 million ($0.62 per share) in the same period in 2013. Suncor’s cash flow from operations also saw an increase, reaching $2.406 billion ($1.64 per share), up from $2.250 billion ($1.49 per share) in last year’s comparable quarter.
The company explained in its announcement that the plunge in net earnings was due to after-tax impairment charges. Those charges amounted to $718 million against the company’s interest in the Joslyn mining project, $297 million against its Libyan assets, and $223 million in Oil Sands assets that no longer fit into Suncor’s future strategy.
On a positive note, Suncor’s portfolio, which now comprises almost 100% crude-oil weighted production, had a favourable influence on the company’s quarterly results. Suncor’s total upstream production saw a tangible increase, reaching 518,400 barrels of oil equivalent per day in 2014’s second quarter, from 500,100 barrels of oil equivalent per day in the same period of 2013.
As for the company’s future strategy, Suncor states it will continue to strive towards ensuring sustainable and reliable operations. The strategy involves continual investment in profitable growth, as well as ensuring that shareholders get good value through dividends and share repurchases.
Download Our Free Special Report – How to Hunt For Value Stocks. Michael Sprung will share with you 5 stocks set for long-term gains.
Is Your Stock Broker Acting in Your Best Interest? Read more here>>
Exchange Traded Funds Expose Investors to Unexpected Risks. Read more here>>
Investment Management – Risk vs. Return. Read more here>>
The opinions expressed here are ours alone. They are provided for information purposes only and are not tailored to the needs of any particular individual or company, are not an endorsement, recommendation, or sponsorship of any entity or security, and do not constitute investment advice. We strongly recommend that you seek advice from a qualified investment advisor before making any investment decision.