Oil and gas firm Canadian Natural Resources on Thursday beat Wall Street estimates for fourth-quarter profit on record production, and raised its quarterly dividend by 5 per cent.
Shares of the company were up about 2.3 per cent at $91.98.
The company said it achieved a net debt level of $10-billion in the quarter, months ahead of its target set to achieve in the first quarter.
Canadian Natural said it would now aim to return 100 per cent of its free cash flow (FCF) to shareholders through dividends and share buybacks, underscoring the energy industry’s focus on shareholder returns and reining in costs.
“This is one of our positive catalysts as CNQ will return 100 per cent of FCF to shareholders. We expect investors will look for more details on the execution of the payout along with the trajectory of capex with the shift in turnaround timing,” said Jefferies analysts in a note.
The company’s overall production in the fourth quarter was up 9.6 per cent at 1.42 million barrels of oil equivalent per day (boepd), compared with last year.
Total U.S. oil demand rose 3.4 per cent in October versus the prior year, according to U.S. Energy Information Administration (EIA)data, benefiting Canadian firms as the U.S. is the largest importer of the country’s oil and gas.
The company reported an adjusted profit of $2.34 per share for the quarter ended Dec. 31, compared with analysts’ average estimate of $2.15 per share, according to LSEG data.
The Canadian firm’s reported profit jumped nearly 73 per cent to $2.63-billion in the quarter, compared with the previous year.