per share of 77 cents, which is more than the 69 cent Zacks Consensus Estimate. Together with decreased unit costs, the outperformance is a result of robust local oil and gas output.
Nevertheless, poorer oil realisations caused the company’s adjusted profit to drop from $1.24 million in the prior year.
The business reported $1.8 billion in sales, 3.4% more than the consensus estimate but 19.3% less than the $2.2 billion in sales from the previous year.
Importantly for investors, MRO’s board of directors recently announced that common shareholders of record on November 15 will receive a quarterly cash dividend of 11 cents per share. On December 11, the dividend will be issued, marking a 10% consecutive rise.
The overall net production (from U.S. and International units) of this Texas-based energy explorer in the reviewed quarter was 421,000 barrels of oil equivalent per day (BOE/d), up from 353,000 BOE/d in the same time last year.
U.S. E&P: Due in part to better production and lower expenses, this U.S. upstream unit’s revenue of $505 million was recorded, down from $723 million in the same period last year. This decline was caused by lower realisations of commodities prices. The sector income was estimated by us at $479.8 million.
Although it was 13.6% less than the $93.67 level from a year ago, Marathon Oil’s average realised liquids prices (crude oil and condensate) of $80.90 per barrel exceeded our expectation of $79.56. Furthermore, the average price realisations for natural gas liquids dropped to $21.37 per barrel, a 37.1% decline. In conclusion, the average realised price of natural gas fell by 70.9% annually to $2.28 per thousand cubic feet, which was less than our projected price of $2.44.
With 369,000 BOE/d, net output increased by 25.1% from the third quarter of 2022. The total U.S. output was 189,000 barrels per day (bpd), or around 51% oil, exceeding our prediction of 352 BOE/d.
The company’s quarterly performance was enhanced by much increased output from Eagle Ford compared to the previous year, however reduced volumes from the Oklahoma region somewhat offset this. While output from Bakken was 121,000 BOE/d compared with 118,000 BOE/d in the same quarter last year, the Eagle Ford region reported an average production of 158,000 BOE/d, a 75.6% increase from the third-quarter 2022 figure. In the meantime, Oklahoma’s output decreased from 54,000 BOE/d a year ago to 46,000 BOE/d.
The division, which finds and produces gas and oil in Equatorial Guinea, posted earnings of $62 million, down from our projected $74.6 million and $181 million in the same time last year. The main causes of these outcomes may be reduced output and liquids pricing.
Marathon reported 52,000 BOE/d of output that was available for sale, which is in line with our forecasts but down from 58,000 BOE/d in the third quarter of 2022.
Marathon’s average realised liquids price, which includes both crude oil and condensate, was $64.30 a barrel, which represents a 13.1% decline from the same period last year. The average price realisations for natural gas and natural gas liquids were $1 per barrel and 24 cents per thousand cubic feet, respectively, which is the same as the equivalent period of 2022.
The quarter’s total costs came to $1.1 billion, which was somewhat less than our projections but virtually constant from the same period last year. For the third quarter, Marathon Oil recorded adjusted operational cash flow of $1.1 billion, which was 20.6% less than a year earlier.
Its long-term debt was $4.9 billion as of September 30, 2023, while its cash and cash equivalents were valued at $174 million. The company’s debt-to-capitalization ratio was 33.8.
During the quarter, Marathon Oil generated $718 million in adjusted free cash flow, after incurring $449 million in capital and exploration costs. During that time, the business also completed $415 million worth of share repurchases.
This year, Marathon has stuck to its planned capital expenditure range of $1.9 billion to $2 billion. In the meantime, MRO is putting shareholder returns ahead of growing output. Production is aimed at the upper end of the company’s forecast, which is 385,000 to 405,000 BOE/d. Marathon further projects daily oil output in the range of 185,000–195,000 barrels.