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Anadarko’s 4Q16 Earnings Fall in Line, Revenue Beats Estimates

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Feb. 2 2017, Published 3:13 p.m. ET

Anadarko’s 4Q16 revenue

Anadarko Petroleum (APC) reported its 4Q16 earnings on January 31, 2017. Anadarko’s 4Q16 revenue was ~$2.4 billion, compared to analysts’ estimate of $1.8 billion. Its revenue was ~$2.1 billion in 4Q15 and ~$1.9 billion in 3Q16.

As you can see in the above graph, Anadarko’s revenue beat estimates for the first time in five quarters. Its revenue in 2016 was ~$7.9 billion, compared to ~$8.7 billion in 2015.

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Anadarko’s 4Q16 earnings

Anadarko Petroleum reported an adjusted net income of -$272 million in 4Q16. Its adjusted net income in the same period in 2015 was -$296 million. In 3Q16, Anadarko Petroleum reported an adjusted net income of -$459 million.

Anadarko reported adjusted EPS (earnings per share) of -$0.50 in 4Q16. Wall Street analysts’ consensus EPS estimate was -$0.49 for the quarter. The company’s EPS were -$0.57 in 4Q15, and they were -$0.89 in 3Q16. Unlike its revenue, APC’s 4Q16 EPS were in line with analysts’ estimates. Its earnings remained negative, though they showed signs of improvement.

APC’s peer Hess Corporation (HES) reported EPS of -$1.01 in 4Q16. You can read about it in A Post-Earnings Analysis of Hess Corporation’s 4Q16.

Peer comparison

APC’s other peers Apache (APA) and Continental Resources (CLR) haven’t announced their 4Q16 earnings yet. Analysts expect the EPS for these companies to come in at ~$0.10 and -$0.10, respectively. Keep checking in with Market Realist for earnings coverage on these companies.

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Key 4Q16 highlights

Anadarko Petroleum’s 4Q16 earnings release noted that the company had closed asset monetizations worth more than $4 billion in 2016. An additional $3.5 billion worth of previously announced divestitures are expected to close in 1Q17.

One of Anadarko Petroleum’s key management objectives is to maintain the strength and flexibility of its balance sheet. The key to doing so is its asset monetization program.

Another key highlight in 2016 was Anadarko Petroleum’s $2 billion acquisition. On September 12, 2016, Anadarko announced that it had agreed to acquire Freeport-McMoRan’s (FCX) Gulf of Mexico assets for $2 billion.

Proved reserves

Anadarko Petroleum’s proved reserves at the end of 2016 were 1.7 million barrels of oil equivalent, 16% lower than its proved reserves at the end of 2015.

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