What Drove ConocoPhillips’s Operating Cash Flow This Year?



COP’s cash flow

ConocoPhillips’s (COP) CFO (cash flow from operating activities) this year has increased on a YoY (year-over-year) basis. Its CFO for the first nine months of 2017 came to ~$4.6 billion, compared with $~3 billion in the first nine months of 2016.

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COP’s 3Q17 cash flow from operations

Conoco’s operating cash flow in 3Q17 totaled ~$1.1 billion, compared with $1.75 billion in 2Q17. In 3Q16, COP reported cash flow from operations of ~$1.3 billion.

Trends in COP’s net income

ConocoPhillips reported a net loss in every quarter in 2016, while in 2017, the company has reported a net loss in only one of the three quarters so far. Its net loss in 3Q17 came to ~$2.4 billion, compared with a net loss of $3.5 billion in 3Q16.

Improvements in the net income primarily drove COP’s operating cash flow growth in the first nine months of 2017.

Reasons for improvement in net income

One of the key reasons for the improvement in COP’s net income in 2017 was higher revenues, which reached $23.8 billion in the first nine months of 2017, compared with $17 billion during the same period of 2016.

COP’s revenues were higher this year on account of higher realized prices. The average realized crude oil price during the first nine months of 2017 was $49.43 per barrel, compared with $39.13 per barrel during the same period in 2016.


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