This week, we will look at ConocoPhillips. As usual, we will take their financial statement and produce some visuals to make it easier to understand how they performed in 24Q2.

Today in a Snapshot

📈Financial Performance: U$14.1B in net profit with a total margin of 16.5%, down from a margin of 17.3% but up in revenue (U$12.9B) in 23Q2.
💵Cashflow: Dipped into cash reserves for U$1.3B.
⚖️Balance Sheet: No significant changes since 24Q1

ConocoPhillips increased both their revenue and net profits this quarter at U$14.1 and U$2.3B, respectively. Despite the increase, ConocoPhillips saw a slight decrease in overall net margin from 17.3% in 23Q2 to 16.5% this period.

ConocoPhillips announced the acquisition of Marathon Oil Corporation Merger. If all goes well, the deal is expected to close in 24Q4.

Overall production increased to 1945MDOED from 1805MDOED (+8%) in 23Q2. Technically, ConocoPhillips segments its business by geography, not by product. However, I have segmented it by product, as I found it more interesting.

Crude Oil: This product benefited from an increased average realised rise of 9% from 23Q2 and a slightly high production of 955MBD compared to 931MBD in 23Q2

Natural Gas: This product suffered a 10% decrease in price and a 7% increase in total product to 3370MMCFD. Unfortunately, this increase in production wasn’t enough to offset the reduction in the average realised price. ConocoPhillips attributed this to a milder winter in North America, resulting in excess NG storage levels.

Natural Gas Liquids: This product benefited from a 9% increase in averaged realised prices and a 4% increase in production to 295MBD compared with 23Q2.

ConocoPhillips did not produce an explicit Q2 cash flow statement. As such, I have interpolated the Q2 results using the H1 and Q1 statements. Despite the substantial profits, ConocoPhillips still needed to dip into their cash reserves for U$1.3B, reducing their stockpile to U$4.3B (-23%).

To be honest, there doesn’t seem to be much going on here in terms of changes from 24Q1. However, what does stand out is the ratio of non-current to current for both assets and liabilities. In fact, it has just shy of 6x the non-current assets and 3.5x the non-current liabilities than their current equivalents. This suggests that ConocoPhillips is confident in its long term. However, importantly, ConocoPhillips still has the liquidity to pay off its current liabilities if required.

As expected, with negligible change in the balance sheet, there is negligible change in the debt-to-equity ratio. The ratio hasn’t changed over the last quarter, remaining at 0.93.

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Cheers,

Connor

All data can be found on the ConocoPhillips Investors website.