Marathon Oil Corp (MRO) Reports Q3 2023 Earnings, Returns Over $475 Million to Shareholders
Marathon Oil Corp (NYSE:MRO) reported Q3 2023 net income of $453 million, or $0.75 per diluted share
Adjusted net income was $466 million, or $0.77 per diluted share
Generated $718 million of adjusted free cash flow during Q3, up 35% sequentially
Returned $476 million or 42% of adjusted CFO to shareholders during Q3
Marathon Oil Corp (NYSE:MRO) released its earnings report for the third quarter of 2023 on November 1, 2023. The company reported a net income of $453 million or $0.75 per diluted share. The adjusted net income was $466 million or $0.77 per diluted share. The net operating cash flow was $1,066 million or $1,144 million before changes in working capital (adjusted CFO). The free cash flow was $573 million or $718 million before changes in working capital and including Equatorial Guinea (E.G.) distributions and other financing (adjusted FCF).
Financial Performance and Shareholder Returns
Marathon Oil Corp (NYSE:MRO) reported another quarter of strong financial performance and consistent operational execution. The company generated $718 million of adjusted free cash flow during the third quarter, up 35% sequentially, at a 38% reinvestment rate. The company also delivered a sequential increase in total third quarter production to 421,000 net barrels of oil equivalent per day (boed) and 198,000 net barrels of oil per day (bopd), both above the high end of annual guidance ranges.
The company returned $476 million or 42% of adjusted CFO to shareholders during the third quarter through $415 million of share repurchases and $61 million of base dividend. In the first three quarters of 2023, the company returned $1.3 billion of capital to shareholders, including over $1.1 billion of share repurchases.
Balance Sheet and Debt Reduction
Marathon Oil Corp (NYSE:MRO) further enhanced its investment-grade balance sheet through gross debt reduction. The company achieved year-to-date gross debt reduction of $451 million, including a $250 million prepayment on its Term Loan Facility in October. The company expects additional gross debt reduction in the fourth quarter while continuing to return at least 40% of adjusted CFO to equity holders.
Future Outlook
Looking ahead to 2024, the company remains committed to its Framework for Success. The company plans to prioritize strong corporate returns on every dollar it invests while striving to deliver peer-leading free cash flow generation, return of capital to shareholders, and per-share growth across a broad range of commodity prices. The company will also work to further bolster its investment-grade balance sheet through continued gross debt reduction and maximize value from its unique E.G. integrated gas operations.
Explore the complete 8-K earnings release (here) from Marathon Oil Corp for further details.
This article first appeared on GuruFocus.
