Chevron earnings fall but shareholders see record windfall in 2023, company raises dividend 8%

Chevron said its fourth-quarter profits fell sharply from a year ago, weighed down by a number of impairment charges, but the second largest U.S. oil company still to managed to return a record amount of cash to its shareholders in 2023.

The oil major returned $23.6 billion to investors by paying out $11.3 billion in dividends and buying back $14.9 billion in shares last year. It did so even as its profit fell about 40% to $21.3 billion from $35.5 billion in 2022.

Chevron said its board approved an 8% increase in the quarterly dividend to $1.63 beginning in March. The company’s stock rose about 1% in early trading.

Here’s what Chevron reported for the fourth quarter compared with what Wall Street was expecting, based on a survey of analysts by LSEG, formerly known as Refinitiv:

• Earnings per share: $3.45 adjusted vs. $3.21 expected
• Revenue: $47.18 billion vs $51.62 billion expected

Chevron’s net income fell 65% to $2.3 billion, or $1.22 per share, during the quarter, from $6.4 billion, or $3.33 per share, a year ago. 

In the latest period, Chevron’s U.S. oil and gas assets recorded a loss of $1.35 billion due to the impact of $1.8 billion in impairment charges and a hit of $1.9 billion associated with obligations to decommission previously sold assets in the Gulf of Mexico.

Excluding the impairment charges, Chevron reported an adjusted profit of $3.45 per share to beat Wall Street’s estimate of $3.21 per share for the quarter.

Crude oil prices were volatile in 2023, with West Texas Intermediate and Brent falling more than 10% for the year on a weakening Chinese economy and a record oil production in the U.S.

Chevron produced a record 3.1 million oil-equivalent barrels per day in 2023, led by 14% growth in the U.S as the company boosted its capital expenditures.

Chevron’s capital expenditures for the quarter rose nearly 16% to $4.4 billion compared with $3.8 billion in the same period a year ago, as the company invested in recently acquired PDC Energy assets and bought a majority stake in the hydrogen fuel project developer ACES Delta.