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WPX Energy Q4 Loss Wider than Expected, Revenues Miss

Zacks Equity Research

Independent oil & gas operator WPX Energy Inc. WPX reported a loss of 24 cents per share in the fourth quarter of 2015, wider than the Zacks Consensus Estimate of a loss of 19 cents. The company had reported a narrower loss of 18 cents per share in the year-ago quarter.

The reported quarter was primarily affected by significantly lower commodity prices.

Full-year 2015 adjusted loss per share was 50 cents, in line with the Zacks Consensus Estimate. The company had generated earnings of 12 cents per share last year.

Total Revenues

WPX Energy’s quarterly revenues of $495 million marginally missed the Zacks Consensus Estimate of $499 million. Total revenues were way lower than the year-ago figure of $1,125 million by 56%.

Full-year 2015 revenues were $1.9 billion, beating the Zacks Consensus Estimate of $1.5 billion but down from the prior-year figure of $3.5 billion by nearly 46%.

Highlights of the Release

Total production in the fourth quarter was 95,571 million cubic feet equivalent (MMcf/e), up from 94,902 MMcf/e in the year-ago quarter.

Oil production shot up 41%, while natural gas liquids production increased nearly 17%.

Total expenses were $2,827 million, up 279.4% from $745 million in the year-ago quarter.

Interest expenses in the reported quarter were $57 million, increasing 62.8% from $35 million in the year-ago quarter.

Realized Prices

Realized oil prices in the quarter were $35.10 per barrel, down 42.6% from $61.14 per barrel in the year-ago quarter. Realized prices for natural gas liquids were down 52.4% to $11.92 per barrel from $25.04 per barrel in the year-ago quarter. Realized natural gas prices were $1.99 per million cubic feet (Mcf), down 38.7% from $3.25/Mcf in the prior-year quarter.

Financial Update

WPX Energy had $38 million of cash and cash equivalents as of Dec 31, 2015, compared with $41 million at the end of 2014.

Long-term debt as of Dec 31, 2015, was $3,189 million, up from $2,260 million as of Dec 31, 2014.

Net cash from operating activities in 2015 was $811 million compared with $1,070 million in the same period a year ago, which benefited from higher commodity prices.

Guidance

The company provided 2016 total production guidance in the range of 75–80 Mboe/d.

WPX Energy provided its capital expenditure guidance in a band of $350–$450 million.

WPX Energy expects cash operating expenses per boe in the range of $10 to $11.50.

Other Company Releases

Noble Energy, Inc. NBL reported adjusted earnings of 44 cents per share in the fourth quarter of 2015. The Zacks Consensus Estimate was a loss of 4 cents.

Murphy Oil Corporation MUR reported a fourth-quarter 2015 loss of 76 cents per share, narrower than the Zacks Consensus Estimate of a loss of $1.15.

Anadarko Petroleum Corporation APC reported a fourth-quarter 2015 loss of 57 cents per share, narrower than the Zacks Consensus Estimate of a loss of $1.05.

Zacks Rank

WPX Energy has a Zacks Rank #2 (Buy).

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