Cenovus announces second quarter results, additional measures to build shareholder value

Second quarter highlights

  • Combined oil sands production up 5% compared with second quarter of 2014
  • Oil sands per-unit operating cost improvement of 30% from second quarter of 2014
  • Gross cash proceeds of $3.3 billion from royalty and fee land business sale, received in July
  • Second quarter cash flow of $0.89 per share, excluding the impact of a one-time cash tax charge of $0.31 per share

Production & financial summary

(For the period ended June 30) Production (before royalties) 2015
Q2
2014
Q2 
%
change
Oil sands (bbls/d) 130,734

124,827 

5
Conventional oil1 (bbls/d) 69,220 76,861 -10
Total oil (bbls/d) 199,954 201,688 -1
Natural gas (MMcf/d) 450 507 -11
Financial ($ millions, except per share amounts)
Cash flow2
    Per share diluted
477
0.58
1,189
1.57
-60
Operating earnings2
    Per share diluted
151
0.18
473
0.62 
-68
Net earnings
    Per share diluted
126
0.15
615
0.81
-80
Capital investment 357 686 -48

1 Includes natural gas liquids (NGLs).
2 Cash flow and operating earnings are non-GAAP measures as defined in the Advisory. See also the earnings reconciliation summary in the operating earnings table.

Strategic update highlights

  • On track to achieve approximately $280 million in 2015 cost reductions, 40% greater than initially targeted
  • Targeting between 300 and 400 job reductions in Calgary in second half of 2015
  • Third quarter dividend reduction of 40%; temporary discount on Dividend Reinvestment Plan (DRIP) discontinued
  • Priority focus on expanding existing oil sands projects but at a more moderate pace of growth than in the past
  • Investment in deferred oil sands expansions being considered for 2016

Read the complete news release

Photos

Cenovus's Christina Lake project in northern Alberta uses steam-assisted gravity drainage (SAGD) technology to produce oil. The process involves drilling into the reservoir and injecting steam at a low pressure to soften the oil so it can be pumped to the surface.
Courtesy Cenovus Energy
Steam generators at Cenovus’s Foster Creek project in northern Alberta. The project uses a process called steam-assisted gravity drainage (SAGD) to produce oil, which involves drilling into the reservoir and injecting steam at a low pressure to soften the oil so it can be pumped to the surface.
Courtesy Cenovus Energy