Canadian National Stock – UPDATE 2-Cenovus Energy misses estimates on uneven demand, weak refinery operations
(Compares with estimates, adds background and details from the results)
Feb 9 (Reuters) – Canada’s Cenovus Energy Inc posted a bigger-than-expected loss on Tuesday, hit by uneven demand for fuel due to renewed COVID-19 travel restrictions and weaker refinery operations.
Along with the rest of Canada’s oil and gas industry, Cenovus endured a very difficult 2020. Crude prices recovered in the final months of the year amid optimism over global vaccine rollouts, but fuel demand still remains uneven.
Cenovus’ fourth-quarter crude utilization was 68%, down from 77% in the third quarter, while refined products fell nearly 12% to 350,000 barrels per day (bpd) from the prior quarter.
Last month, Cenovus forecasted higher production and spending for 2021 after its purchase of rival Husky Energy, but stressed its focus on cutting debt as the oil industry recovers from the pandemic.
After suspending its crude-by-rail program in early 2020, Cenovus ramped up activity in the fourth quarter.
The company on Tuesday said that with resumption of the rail program, Cenovus exited December with average loading of nearly 28,000 barrels per day (bpd) of its own crude oil for transport by rail for the month plus nearly 10,000 bpd for third parties.
Its fourth quarter refining and marketing operating margin shortfall was C$73 million compared with an operating margin of C$109 million last year.
On a sequential basis, the company’s production also fell nearly 1% to 467,202 barrels of oil equivalent per day (boepd).
Net loss narrowed to C$153 million ($120.25 million), or 12 Canadian cents per share, in the fourth quarter ended Dec. 31, from C$194 million, or 16 Canadian cents per share, in the third quarter.
On an adjusted basis, Cenovus posted a loss of 45 Canadian cents per share, while analysts had expected a loss of 10 Canadian cents per share, according to Refinitiv IBES. ($1 = 1.2724 Canadian dollars) (Reporting by Arunima Kumar in Bengaluru; Editing by Shailesh Kuber)