ConocoPhillips, the U.S.oil company that plans to spin off its refining business, reported fourth- quarter profit that surpassed analysts’ estimates as output and refining earnings exceeded forecasts.
Net income climbed 66 percent to $3.39 billion, or $2.56 a share, from $2.04 billion, or $1.39, a year earlier, Houston-based ConocoPhillips said in a statement today. Profit excluding gains on pipeline asset sales and one-time costs was about $2.02 a share, 22 cents more than the average of 18 analysts’ estimates compiled by Bloomberg.
ConocoPhillips said fourth-quarter revenue climbed 17 percent from a year earlier to $62.4 billion.
“ConocoPhillips continues to hit on all cylinders,” said Brian Youngberg, an analyst at Edward Jones in St. Louis who has a “buy” rating on ConocoPhillips shares and owns none. “Production was slightly higher than the company had guided toward and the refining and marketing decline in earnings was not as great as generally anticipated.”
Output of oil and gas in the quarter fell 7.6 percent from a year earlier following asset sales and suspensions of projects in Libya and China. ConocoPhillips said fourth-quarter production was the equivalent of about 1.6 million barrels of oil a day, surpassing a previous daily forecast of 1.56 million to 1.58 million barrels.
The company said it acquired more than 100,000 acres in North American shale projects that are rich in petroleum liquids, taking its shale acquisitions to more than 500,000 acres in 2011. ConocoPhillips said it’s limiting investment in North American gas production, which comprised about 26 percent of output last year.
Refining and marketing income fell 2.9 percent to $201 million, excluding gains from asset sales. Refiners including Tesoro Corp. and Marathon Petroleum Corp. warned of losses in the quarter as profit margins narrowed on rising oil prices.
ConocoPhillips plans to spin off its refining business in the second quarter so it can focus on finding and producing oil and natural gas. The new company will be known as Phillips 66 and will trade under the symbol PSX.
ConocoPhillips is in the midst of a three-year plan to sell $15 billion to $20 billion of assets by the end of 2012 to fund share repurchases and position itself for future growth.
Brent crude futures, a benchmark oil price used by much of the world, climbed 25 percent from a year earlier to average $109.02 a barrel in the fourth quarter. Natural-gas futures traded in New York averaged $3.48 per million British thermal units in the quarter, a decline of 13 percent from a year earlier. Gas this month traded at the lowest price since 2002.
In addition to asset sales, ConocoPhillips in 2011 completed the sale of its 20 percent stake in OAO Lukoil, a Russian oil producer.
Unrest in Libya caused ConocoPhillips to suspend production from that country last year. The company’s net oil output from Libya averaged about 46,000 barrels a day in 2010, according to a regulatory filing.
ConocoPhillips rose 0.34 percent to $70.85 at 9:33 a.m. in New York. Before today, the stock had declined 3.1 percent this year.
ConocoPhillips leads major U.S. oil companies in reporting fourth-quarter earnings. Chevron Corp., the second-biggest U.S.oil company, is scheduled to release results on Jan. 27, followed by Exxon Mobil Corp., the largest U.S.oil company, on Jan. 31.
