ConocoPhillips (COP) shares fell 0.5% after the integrated oil company posted better than expected earnings, benefiting from high oil prices. Production fell slightly, and the company sold off numerous assets.
“ConocoPhillips beat expectations with production volumes slightly higher than anticipated and the Refining and Marketing segment reporting a smaller decline in profitability than anticipated. Overall, it was a strong quarter to end a strong year as the company continues its transition to reduce its size and separate into two separate companies by the middle of the year,” wrote Edward Jones analyst Brian Youngberg.
The company posted $2.02 of EPS after excluding one-time items, against analysts’ expectations for $1.77. Conoco’s worldwide production fell 1% after excluding dispositions and the suspension of operations in Libya and China. Production was 2% higher than the company had anticipated, Youngberg noted. Conoco continues to reduce its reliance on North American natural gas, as gas prices have fallen considerably.
“Due to the current market environment, the company continues to limit investments in North American natural gas production, which represented 26 percent of 2011 production,” the company said.
ConocoPhillips is in the midst of a major transition as it sells assets and spins off its downstream operations into a new business called Phillips 66. That transition is expected to happen by June.
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