Home / Street Sector / Chesapeake Energy (NYSE:CHK) Shows Intention To Shore Up Its Finances Through Divestitures- Canadian Natural Resources (CNQ), McDermott International (MDR)

Chesapeake Energy (NYSE:CHK) Shows Intention To Shore Up Its Finances Through Divestitures- Canadian Natural Resources (CNQ), McDermott International (MDR)

Chesapeake Energy Corporation (NYSE:CHK) [Detail Analytic Report] proclaimed that it was selling $470 million assets in Oklahoma to Newfield Exploration Co. (NYSE:NFX) as part of an intention to shore up its finances through divestitures. Chesapeake Energy reported that it would sell around 42,000 net acres in Oklahoma’s STACK field, with current production of 3,800 barrels of oil equivalent per day. Doug Lawler, Chief Executive of Chesapeake stated that they expect subsequent divestitures during the Q2 and Q3. Chesapeake Energy lowered its forecast for 2016 production costs to $3.40 to $3.60 per barrel of oil equivalent from $3.60-$3.80 per boe.

On the other side Lawler commented during first quarter earning call that Chesapeake is delivering on all four of the focus points for 2016 that they stated in February: maximizing liquidity, optimizing their portfolio, increasing cash flow and lowering debt. They are pleased to announce about $500 million of incremental asset sales above the $700 million they reported in late February. The STACK acreage sale they have declared accelerates value from a portion of their undeveloped acreage that currently generates very little cash flow, giving them the ability to enhance current liquidity. This deal contributes substantially to achieving their earlier reported target of an incremental $500 million to $1 billion of asset sales by year-end.

Chesapeake Energy declared its first quarter loss of $921 million. On a per-share basis, the Oklahoma City-located firm reported that it had a loss of $1.44. Losses, revised for asset impairment costs and non-recurring costs, were 10 cents a share. The results topped Wall Street anticipations. The firm announced revenue of $993 million in the quarter, also beating Street forecasts.

Canadian Natural Resources Limited (NYSE:CNQ) [Detail Analytic Report] declared that Board of Directors of the firm has announced a quarterly cash dividend on its common shares of C$0.23 per common share. The dividend will be paid on July 1, 2016 to investors of record at the close of trading session on June 17, 2016. Moreover, Canadian Natural released its first quarter loss of $76.5 million. The firm reported that it had a loss of 7 cents a share. The results topped Wall Street estimates.

Canadian Natural declared its Q1 revenue of $1.65 billion. Shares of Canadian Natural have increased 28 percent since the starting of the year. The stock has plunged 15 percent in the previous twelve months. Steve Laut, President of Canadian Natural commented on the results that the first three months of 2016 were operationally strong for Canadian Natural. The firm delivered production volumes within guidance and lower operating costs, with an operating cost cut of 13% in E&P crude oil and NGLs and 14% in North America natural gas, on a per unit cost basis from first quarter of 2015 levels.

At Horizon, they achieved record low operating costs of $26.55/bbl and strong production volumes of approximately 128,000 bbl/d. Positive cash flow was delivered for all categories of their assets and reflects the strength of their diverse portfolio. The advancement of the Horizon Phase 2B expansion is progressing as planned and commissioning of certain Phase 2B systems commenced in March 2016. Their teams at Horizon are ready for execution of the scheduled 35 day major turnaround in early July 2016, where they will also tie in major components of Phase 2B.

McDermott International Inc. (NYSE:MDR) [Detail Analytic Report] disclosed that the firm has been awarded three separate projects by a major national oil firm for the integrated engineering, procurement, construction, and installation services in several fields in the Arabian Gulf. In addition to this, there has also been an award of an additional scope on an existing contract, also being executed in the Arabian Gulf. Work on the projects is anticipated to be executed through the Q4 of 2017.

Linh Austin, Vice President for Middle East at McDermott stated that these awards are due, in part, to McDermott’s ability to provide a highly efficient solution with schedule certainty and draws upon their in-depth knowledge and experience working offshore in the Middle East area over many years. McDermott International also reported a loss of $2.2 million in its Q1. On a per-share basis, the Houston-located firm reported that it had a loss of 1 cent. The results beat Wall Street outlooks.

McDermott International declared revenue of $729 million in the quarter, also topping Street forecasts. According to Zacks, analysts have expected $670.4 million. McDermott expects full-year earnings to be 6 cents a share, with revenue expected to be $2.7 billion.

About Aaron Smithies

Aaron Smithies has a wide look on current monetary and financial events. He is an editor and a writer. His views; At Streetwise Report, we think the best opportunities arise from a complete understanding of all investing disciplines in order to identify the most attractive stocks at any given time. Interests: Biotech, Finical markets, Dividend stock ideas & income, Energy stocks, Consumer goods stocks

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