Chevron doubles annual profit to a record $36.5 billion, but misses estimates

Chevron Corp. reported a record profit of 36.5 billion dollars for 2022 on Friday, more than double that of the previous year, but below Wall Street estimates, due to the depreciation of assets and the fall in oil prices and the gas.

The second-largest U.S. oil producer’s adjusted net profit for 2022 surpassed its previous record, set in 2011, by about $10 billion. But $1.1 billion in writedowns on its international oil and gas operations in the fourth quarter left earnings below forecasts of adjusted net income of $37.2 billion.

The Chevron numbers kick off what promises to be a period of high profit reporting from the world’s energy providers. High prices stemming from strong demand and shortages since Russia’s invasion of Ukraine put Western energy companies in a position that analysts say will net them a combined $200 billion in profit this year.

Earnings in the sector have already pushed energy stocks to the top of market returns, as companies raise their dividends to shareholders. The latest figures could spark new requests for windfall tax.

On Wednesday, the White House protested Chevron’s decision to triple the budget to buy back its own shares with future profits, which now stands at $75 billion over an undisclosed period. According to the Government of Joe Bidencompanies should invest more in ways to lower prices for consumers.

Investors reacted by pushing Chevron shares up nearly 5% on Thursday to $187.79, up 44% over the past 52 weeks.

Last year, Chevron paid $26 billion in dividends and buybacks to its shareholders and invested $15.7 billion. The oil company says it is increasing capital spending to $17 billion by 2023, two-thirds of it in the United States, where production has risen 4 percent.

In 2022, Chevron’s free cash flow, a closely watched measure of operating efficiency, increased by $15 billion from a year earlier.

A return on capital employed of more than 20%, or how much the company earns for every dollar invested in the business, “shows that our focus on capital efficiency is paying off,” Chief Executive Michael Wirth said in a release.

In the most recent quarter, Chevron posted adjusted earnings of $7.9 billion, or $4.09 per share, up 61% from a year ago.

The full-year profit increase came despite weaker global production, led by a 7% decline in international production due to the end of concessions in Thailand and Indonesia.