Revenue declines, net income rises in 3Q
Don Stowers, Editor - OGFJ
Laura Bell, Statistics Editor - Oil & Gas Journal
Revenues and net income for the group of publicly-traded US-based companies tracked by Oil & Gas Journal and Oil & Gas Financial Journal were out of sync in the third quarter of 2014. Total revenues declined by about $3.2 billion (about 2%) compared to the third quarter of 2013 and dropped by around $4.5 billion (also around 2%) from the second quarter of 2014. Total revenues for the entire group were slightly less than $238 billion for the current quarter.
In stark contrast, net income for the group grew by more than $7.7 billion (up 38%) over the third quarter of 2013 and by nearly $4.8 billion (up 21%) over the previous quarter.
The decline in revenues represents a reversal of revenue trends over the past few quarters, while the growth in net income shot up by one of the largest margins in recent years.
The number of reporting companies increased by two to 131 in the third quarter. Eleven companies on the OGJ150 failed to report their earnings to the US Securities Exchange Commission by press time for this issue.
Year-to-date capital spending stood at just over $159 billion so far this year, up more than $11 billion from the same quarter in 2013, about an 8% increase.
Total asset value for the group of reporting companies grew to more than $1.488 trillion compared to $1.406 trillion for the second quarter of 2013, representing about a 6% rise in value year over year. Total assets were up nearly $15.7 billion over the second quarter of 2014, about a 1% increase.
Stockholder equity for the entire group grew by almost $51.9 billion (8%) from the same quarter in 2013 and by nearly $11.4 billion (2%) from the previous quarter.
Largest in net income
The largest 20 companies ranked according to net income had approximately $26.87 billion in collective net income for the third quarter of 2014. This compares with $21.45 billion for the same quarter in 2013 and $24.03 billion for the prior quarter in 2014. The numbers represent an increase of about 12% over the previous quarter and 26% year over year compared to the same quarter in 2013.
Based on net income, the top 20 group saw its largest turnover in quite a few years. ExxonMobil, Chevron, ConocoPhillips, and Occidental remain the top four companies with a collective net income of about $17.91 billion for the quarter. This represents about 66% of the net income for the top 20 companies and about 63% of the net income of the entire OGJ150 group.
However, seven companies that were among the top 20 in net income last quarter dropped off after reporting third-quarter results - Apache Corp., Freeport McMoran, Southwestern Energy, Range Resources, Whiting Petroleum, Cimarex Energy, and EQT Production. New companies on the top 20 list this time are Continental Resources (No. 10), Energen Corp. (No. 11), Pioneer Natural Resources (No. 15), Concho Resources (No. 16), Newfield Exploration (No. 17), Denbury Resources (No. 18), and Eagle Rock Energy Partners LP (No. 19).
Largest in total revenue
The largest 20 companies in total revenue had $222.7 billion in total revenue for the third quarter compared to $228.9 for the prior quarter and $228.8 for the third quarter of 2013. Both figures represent about a 3% decline in revenue for the top 20 companies compared to about a 2% drop in revenue for the entire group of 131 companies.
Fifteen of the top 20 companies in total revenues saw an increase in total revenue over the second quarter. Five saw revenue declines, but this included three of the four largest companies, ExxonMobil Corp., Chevron Corp., and Occidental Petroleum, along with No. 16 Noble Energy and No. 20 Whiting Petroleum.
Previous No. 20 WPX Energy dropped off the top 20 list and was replaced by Houston-based LINN Energy, which debuted in fourteenth place with nearly $1.44 billion in revenues for the quarter.
Total revenue for the entire OGJ150 group was $237.95 billion, so the top 20 companies with $222.73 billion in revenues, had 93% of the revenues for the collective group of 131 companies.
The top four companies in total revenue (ExxonMobil, Chevron, ConocoPhillips, and Occidental) together took in $181.11 billion, which represents approximately 77% of the total revenue for the entire group.
Top spenders
Spending by the top 20 companies in the third quarter of 2014 grew to just over $127.58 billion (year to date). This was up a modest 2% over the $125.09 billion spent YTD in the third quarter of 2013.
Top spenders were, in order: Chevron ($25.7 billion), ExxonMobil ($24.4 billion), ConocoPhillips ($12.7 billion), Occidental ($7.5 billion), Anadarko ($7.3 billion), Apache ($7.1 billion), EOG Resources ($5.7 billion), Devon Energy ($5.0 billion), Chesapeake Energy ($3.9 billion), and Hess Corp. ($3.7 billion).
Fastest-growing companies
The fastest-growing company, ranked by stockholders' equity, for 3Q14 was Sabine Royalty Trust, which saw a 72.1% rise in value. Sabine is based in Dallas. Mid-Con Energy Partners LP, also based in Dallas, was No. 2 with a 65.1% increase. Houston-based Gastar Exploration saw a 53.2% jump in stockholders' equity, while Diamondback Energy, headquartered in Midland, Texas, rose 50.6%, and Callon Petroleum of Natchez, Miss., saw a 47.1% increase in value.
Click here to download the PDF of the OGJ150 Quarterly "Quarter ending Sept. 30, 2014"
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