Chevron Reports Quarterly Profits of $571 Million

Chevron Corporation (NYSE: CVX) reported earnings of $571 million, or 30 cents per share, for the second quarter of 2015 on revenues of $37 billion. This compares with earnings of $5.7 billion, or $2.98 per share on revenues of $56 billion in the same quarter of 2014.

“Second quarter financial results were weak, reflecting a crude price decline of nearly 50% from a year ago, said John Watson, Chairman and CEO of the San Ramon-based company. “Our upstream businesses were particularly hard hit, as lower prices reduced revenues and triggered impairments and other charges. Downstream operations continued to deliver strong financial performance, reflecting both high reliability and improved margins.”

Watson continued, “Multiple efforts to improve future earnings and cash flows are underway.” These include reducing costs through renegotiating prices with suppliers, reducing the company’s employee and contractor workforce, and cutting back on capital investments, he said.

Included in the latest profit figures were non-cash impairments of $1.96 billion and charges of $670 million related to project suspensions and adverse tax effects, resulting from the company’s downward revision of its longer-term expectations on crude oil prices. These were partially offset by gains on asset sales of $1.80 billion.

Worldwide production was up 2% in the second quarter to net oil-equivalent of 2.60 million barrels per day, from 2.55 million barrels per day in the year-earlier quarter.

U.S. upstream operations incurred a loss of $1.04 billion in the second quarter of 2015 compared to earnings of $1.05 billion a year earlier.

U.S. downstream operations earned $731 million in the latest quarter, compared with earnings of $517 million a year earlier, due to higher margins on refined product sales.

The company’s average sales price per barrel of crude oil and natural gas liquids was $50 in the latest quarter, down from $92 a year ago. The average sales price of natural gas was $1.92 per thousand cubic feet, compared with $4.09 in the 2014 period.

Refined product sales were 1.23 million barrels per day, up 3% from 2014, reflecting higher gasoline sales. Branded gasoline sales were 535,000 barrels per day, up 2% from the 2014 period.

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