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Chevron Financials Q1 2013

by June 3, 2013

  • Declining sales, declining margins, declining profits.
  • To add gas on fire (figuratively speaking), operating cash flow declined as well.
  • Dividends and share repurchases had to be financed by loans.

Overall some indications of operational stress.
Chevron had better days for sure.
The charts below are self-explanatory.

Chevron Financials Q1 2013
Updated: Earnings and financial results


Sales & gross margin
Operating income
Net income
Revenues and costs


  • Chevron's sales, COGS, gross margin

    Chevron financials for Q1 2013
    Placeholder for chart showing: sales, cost of sales, gross margin.

    Click for larger Chevron Gross profit margin from sales , Q1 2013

    Chevron’s sales continued to decline, and gross margin declined even more.

    • U.S. upstream earnings of $1.1 billion in Q1 2013 down $397 million YoY.
    • Decrease was primarily due to lower crude oil realizations of about $190 million and higher operating expenses of about $130 million.
    • Average realization for U.S. crude oil and natural gas liquids in first quarter 2013 was $94 per barrel, compared with $102 a year earlier.
    • The average natural gas realization in first quarter 2013 was $3.11 per thousand cubic feet, compared with $2.48 in the year-ago period.
    • Production details:
      • Net oil-equivalent production of 664,000 barrels per day in first quarter 2013 was up 13,000 barrels per day, or about 2 percent, from a year earlier.
      • The increase in physical production was primarily due to further ramp-up of projects in:

        • Gulf of Mexico
        • Marcellus Shale in western Pennsylvania
        • recently-acquired Delaware Basin properties in New Mexico
        • all the above partially offset by normal field declines.
      • The net liquids component of oil-equivalent production of 455,000 barrels per day for first quarter 2013 was largely unchanged from the corresponding 2012 period.
      • Net natural gas production was 1.26 billion cubic feet per day in first quarter 2013, an increase of 7 percent from first quarter 2012.


  • Chevron's operating income

    Chevron financials for Q1 2013
    Placeholder for chart showing: sales, cost of sales, operating expenses, operating income.

    Click for larger Chevron Operating income from sales , Q1 2013

    Operating income was nothing to praise. Selling, general and administrative expenses increased $637 million between quarters mainly due to higher employee compensation and benefits costs of $410 million, and higher professional services of $330 million, partially offset by lower transportation expense of $90 million. The decrease in exploration expenses between the comparative periods was primarily due to lower charges for well writeoffs, partially offset by higher geological and geophysical expenses. Depreciation, depletion and amortization in the first quarter 2013 increased mainly due to higher depreciation rates for certain oil and gas producing fields.

  • How Chevron generates net income

    Chevron financials for Q1 2013
    Placeholder for chart showing: gross margin, operating expenses, non-operating expenses, income taxes, exceptional expenses, preferred distributions, net income.

    Click for larger Chevron Net income overview , Q1 2013

    Net income declined of course, despite a lower tax rate. Effective income tax rates for the 2013 were 39% versus 46% in 2012. The decrease in the effective tax rate between periods was driven by a lower effective tax rate in international upstream operations. The lower international upstream rate was primarily due to non-recurring tax benefits in the current period and foreign currency remeasurement impacts between periods.

  • Detailed revenues and costs for Chevron

    Chevron financials for Q1 2013
    Placeholder for chart showing: detailed revenues and costs.

    Click for larger Chevron Detailed revenues and costs , Q1 2013

    Many more details are presented here; issues were already presented in the previous charts.



Balance sheet overview
Current assets
Long term assets
Current liabilities
Long-term liabilities
Equity


  • Chevron Balance sheet overview: assets and liabilities

    Chevron financials for Q1 2013
    Placeholder for chart showing: balance sheet: current assets, long term assets, current liabilities, long-term liabilities, equity.

    Click for larger Chevron Balance sheet overview , Q1 2013

    Balance sheet indicates some operational stress: current assets declined, and debt increased. The decline reflected working capital requirements in the current period.
    Debt and Capital Lease Obligations Chevron’s total debt and capital lease obligations were $14.1 billion at March 31, 2013, up from $12.2 billion at December 31, 2012.
    All securities issued by Chevron are rated AA by Standard and Poor’s Corporation and Aa1 by Moody’s Investors Service. The company’s U.S. commercial paper is rated A-1+ by Standard and Poor’s and P-1 by Moody’s.

  • Chevron's current assets details

    Chevron financials for Q1 2013
    Placeholder for chart showing: current assets details: cash, investments, accounts receivable, inventory, deferred tax, others.

    Click for larger Chevron Detailed current assets , Q1 2013

    Cash declined, and receivables increased despite lower sales, indicating slightly deteriorating trade terms.

  • Chevron's property, equity, intangibles

    Chevron financials for Q1 2013
    Placeholder for chart showing: property plant and equipment, equity, goodwill, intangibles, others.

    Click for larger Chevron Detailed long term assets , Q1 2013

    Property plant and equipment increased a lot. Note that happened while depreciation, depletion and amortization in the first quarter 2013 increased mainly due to higher depreciation rates for certain oil and gas producing fields. Not much detail was given by Chevron’s management in it’s earnings reports, for the reasons why property increased so much.

  • Chevron's accounts payable, debt, taxes due

    Chevron financials for Q1 2013
    Placeholder for chart showing: current liabilities: payables, debt, taxes, others.

    Click for larger Chevron Detailed current liabilities , Q1 2013

    Current liabilities maintained more or less the same; Chevorn had to take some short term debt.

  • Chevron's debt, pensions, and other long term liabilities

    Chevron financials for Q1 2013
    Placeholder for chart showing: long term liabilities: debt, taxes, others.

    Click for larger Chevron Detailed long term liabilities , Q1 2013

    Long term liabilities increased, particularly with respect to deferred taxes. Nothing troublesome yet.’;

  • Chevron's equity components

    Chevron financials for Q1 2013
    Placeholder for chart showing: equity components: stock, earnings, others.

    Click for larger Chevron Detailed equity components , Q1 2013

    Equity increased substantially, despite raising dividend. However equity depends a lot on estimated hydrocarbon reserve and oilfield depletion, so to figure might not be very reliable in Chevron’s case. Cash flow should be a much better proxy for actual returns of Chevron.



Cash flow overview
Operating cash flow
Financing cash flow
Investment cash flow


  • Chevron's cash flow overview: operational, financial, investment

    Chevron financials for Q1 2013
    Placeholder for chart showing: cash flows overview: net cash flow, operating, financing, investment cash flow.

    Click for larger Chevron Cash flows overview , Q1 2013

    Operating cash flow is not great at all, we need to question the accuracy of reported earnings.

  • Chevron's current assets details

    Chevron financials for Q1 2013
    Placeholder for chart showing: operating cash flows details: net income, adjustments, accounts payable, accounts receivable, inventory.

    Click for larger Chevron Detailed operating cash flows , Q1 2013

    Working capital deteriorated.

  • Chevron's property, equity, intangibles

    Chevron financials for Q1 2013
    Placeholder for chart showing: financing cash flows details: debt, stock, dividend.

    Click for larger Chevron Detailed financing cash flows , Q1 2013

    Dividend payments and share repurchases were financed by short term loans, and not organically from operating cash flow.

  • Chevron's accounts payable, debt, taxes due

    Chevron financials for Q1 2013
    Placeholder for chart showing: investment cash flows details: property plant and equipment, investments, securities.

    Click for larger Chevron Detailed investment cash flows , Q1 2013

    Investment cash flows shows large capital expenditures outflows, and not much detail was reported by Chevron.


Data sources for Chevron financials for Q1 2013:
All charts are interactive.
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