Yahoo Finance Cheniere (LNG) Q1 Earnings Decline Y/Y, Sales Beat Estimates
Cheniere Energy Inc. LNG reported first-quarter 2024 adjusted profit of $2.13 per share, which missed the Zacks Consensus Estimate of $2.3. This underperformance can be primarily attributed to a year-over-year increase in costs and expenses. The bottom line also deteriorated from the year-ago quarter’s level of $6.89.
Revenues totaled $4.3 billion, which beat the Zacks Consensus Estimate of $4 billion. This was primarily due to gas export revenues of $4 billion, which beat the consensus estimate by 7.1%. However, the top line decreased 41.8% from the year-ago quarter’s level of $7.1 billion. This can be attributed to the year-over-year reduction in liquid natural gas sales.
Cheniere reported consolidated adjusted EBITDA of $1.8 billion in the first quarter, down 50.7% from that recorded a year ago. The decline was primarily caused by the moderation of global gas prices and the increased proportion of liquid natural gas sales under long-term contracts. This resulted in lower overall margins per MMBtu of liquid natural gas delivered compared to the previous period.
Distributable cash flow (DCF) came in at $1.16 billion. In the reported quarter, the company shipped 166 cargoes compared with 167 in the year-ago period. The total volume of liquid natural gas exported came in at 602 trillion British thermal units (TBtu) compared with 603 TBtu in the comparable period of 2023.
Cheniere made repurchases totaling 7.5 million shares of common stock, amounting to roughly $1.2 billion. Additionally, Cheniere repaid $150 million of consolidated long-term debt.
The company declared a quarterly cash dividend of 43.5 cents per common share (which was consistent with the previous year's level), payable on May 17, to shareholders of record at the close of the business on May 10.
Cheniere Energy, Inc. Price, Consensus and EPS Surprise
Cheniere Energy, Inc. price-consensus-eps-surprise-chart | Cheniere Energy, Inc. Quote
Costs & Balance Sheet
Costs and expenses amounted to $3 billion for the first quarter, up 355.1% from the prior-year quarter’s level.
As of May 31, 2024, Cheniere had approximately $4.4 billion of cash and cash equivalents. Its net long-term debt amounted to $21.4 billion.
Guidance
The Zacks Rank #3 (Hold) company expects consolidated adjusted EBITDA in the $5.5-$6 billion range for 2024.
It also expects DCF to be in the band of $2.9-$3.4 billion.
Project Updates
Sabine Pass Liquefaction Project (SPL): Cheniere operates six natural gas liquefaction trains for a total production capacity of about 30 million tons per annum (mtpa) of liquid natural gas at the Sabine Pass LNG terminal in Cameron Parish, LA.
SPL Expansion Project: Cheniere Partners is developing an expansion of the SPL Project, which could produce up to 20 mtpa of liquid natural gas. In February 2024, specific subsidiaries of Cheniere Partners applied to the FERC, seeking the approval to site, construct and operate the SPL Expansion Project. Additionally, they submitted an application to the DOE, seeking authorization to export liquid natural gas to both FTA and non-FTA countries. Notably, both applications exclude debottlenecking.
CCL Project: The company operates three natural gas liquefaction trains at the Corpus Christi LNG terminal, with a total production capacity of approximately 15 mtpa.
CCL Stage 3 Project: Cheniere is constructing an expansion next to the CCL Project, which includes seven midscale Trains. This expansion is expected to have a total production capacity exceeding 10 mtpa of liquid natural gas. The first production from the first train of the CCL Stage 3 Project is projected to be achieved by the end of 2024, with a progress update as of Mar 31, 2024.
CCL Midscale Trains 8 & 9 Project: Cheniere, along with its partner, is developing two midscale Trains adjacent to the CCL Stage 3 Project, with an anticipated total production capacity of about 3 mtpa of liquid natural gas. In March 2023, certain company subsidiaries submitted an application to the Federal Energy Regulatory Commission (FERC) for site approval, to construct and operate the project.
Additionally, in April 2023, Cheniere applied to the Department of Energy (DOE), seeking authorization to export liquid natural gas to both the Free-Trade Agreement (FTA) and non-FTA countries. In July 2023, the company received approval from the DOE to export liquid natural gas to FTA countries.
Important Energy Earnings so far
While we have discussed Cheniere Energy’s first-quarter results in detail, let’s take a look at some other key energy reports of this season.
EOG Resources, Inc. EOG, an American energy company engaged in hydrocarbon exploration, announced first-quarter 2023 adjusted earnings per share of $2.82, which beat the Zacks Consensus Estimate of $2.70. The bottom line also increased from the year-ago quarter’s level of $2.69. Strong quarterly results were primarily driven by higher total production volumes.
Total quarterly revenues of $6.1 billion beat the Zacks Consensus Estimate of $5.9 billion. The top line also surpassed the prior-year quarter’s level of $6.04 billion. As of Mar 31, 2024, EOG had cash and cash equivalents worth $5.3 million and a long-term debt of $3.8 billion.
SLB SLB, the largest oilfield contractor, announced first-quarter 2024 earnings of 75 cents per share (excluding charges and credits), which beat the Zacks Consensus Estimate of 74 cents. The bottom line also increased from the year-ago quarter’s level of 63 cents.
SLB’s strong quarterly earnings resulted from higher evaluation and stimulation activities in the international market. As of Mar 31, 2024, the company had approximately $3.5 billion in cash and short-term investments, and a long-term debt of $10.7 billion.
Independent oil refiner and marketer Valero Energy VLO reported first-quarter 2024 adjusted earnings of $3.82 per share, which beat the Zacks Consensus Estimate of $3.18, driven by a decline in total cost of sales. Adjusted operating income in the Refining segment totaled $1.7 billion, down from $4.1 billion in the year-ago quarter. The figure, however, was above our estimate of $1.6 billion.
Valero’s total cost of sales declined to $29.8 billion from the year-ago figure of $32.1 billion. The figure was also below our estimate of $30.4 billion, primarily due to lower material costs and operating expenses. The first-quarter capital investment totaled $661 million, of which $563 million was allotted for sustaining the business.
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