On October 25, 2023, Hess Corp (HES, Financial) released its Q3 2023 earnings report. The company reported a net income of $504 million, or $1.64 per share, compared to a net income of $515 million, or $1.67 per share, in Q3 2022. The slight decrease in adjusted after-tax results compared with the prior-year quarter reflects lower realized selling prices, partially offset by higher production volumes.
Financial and Operational Highlights
Hess Corp's oil and gas net production was 395,000 boepd, a 13% increase from 351,000 boepd in Q3 2022. Bakken net production was 190,000 boepd, up 14% from 166,000 boepd in Q3 2022. The company's E&P capital and exploratory expenditures were $998 million, compared with $701 million in the prior-year quarter.
Updated 2023 Full Year Guidance
The company's net production is now forecasted to be approximately 390,000 boepd, which is at the upper end of the previous guidance range of 385,000 boepd to 390,000 boepd. E&P capital and exploratory expenditures are expected to be approximately $4.1 billion, up from previous guidance of $3.7 billion.
Merger with Chevron
On October 23rd, Hess Corp entered into an agreement to merge with Chevron. The transaction is expected to close in the first half of 2024.
Financial Tables Summary
The company's Exploration and Production sector reported a net income of $529 million in Q3 2023, compared with $572 million in Q3 2022. The Midstream segment had a net income of $66 million in Q3 2023, compared with $68 million in the prior-year quarter. After-tax expense for Corporate, Interest, and Other was $91 million in Q3 2023, compared with $125 million in Q3 2022.
Analysis of Company's Performance
Despite a slight decrease in net income, Hess Corp demonstrated strong operational performance with a significant increase in oil and gas production. The company's decision to merge with Chevron indicates a strategic move towards expansion and growth. The updated 2023 full year guidance reflects the company's positive outlook for the future.
Other Pertinent Details
As of September 30, 2023, Hess Corporation had cash and cash equivalents of $2.0 billion and debt and finance lease obligations totaling $5.6 billion. The Midstream segment had cash and cash equivalents of $4 million and total debt of $3.1 billion.
