Murphy Oil Corp. on Thursday reported a third-quarter net loss of $243.6 million as the company dealt with tropical storms and operation closures.
For the three months that ended Sept. 30, earnings per share fell to a loss of $1.59, down from a profit of $6.79 a share, a year ago.
Revenue fell 48% to $421.9 million.
Results beat analysts' expectations despite significant headwinds.
The oil and gas company faced one of the most severe hurricane seasons on record with six major storms, slowing or stalling production in the Gulf of Mexico through the quarter and into October. Meanwhile, crude oil prices are recovering after hitting record lows in April.
"Our assets generated strong production aside from these storms and otherwise would have reached the high end of our guidance," Murphy Oil President and Chief Executive Roger Jenkins said in a report released before the stock market opened. Steps are being taken to improve the company's margins and hire new workers while managing covid-19 concerns, he said.
Third-quarter production averaged 153,000 barrels of oil equivalent per day -- a measure used by oil companies to allow for like-to-like comparisons. This included a loss of 12,400 barrels a day from offshore shut-ins, up from an expected 4,800 barrels that accounted for storm-related downtime. A shut-in is when a well is closed off and stops producing.
These losses were offset by strong onshore business results, Murphy Oil said.
Of the 153,000 barrels produced, 41% came from offshore drilling in the Gulf, 36% from onshore Canada locations and 23% from the Eagle Ford Shale in Texas. During the quarter, Murphy Oil's field prices were $39.68 per barrel of oil and $1.78 per 1,000 cubic feet of natural gas.
Excluding discontinued operations, restructuring and other one-time costs, the oil and gas company had an adjusted net loss of $24 million, or 15 cents per share. This beat Wall Street's predicted adjusted loss of 19 cents per share, according to a Zacks Consensus Estimate.
Murphy Oil, formerly based in El Dorado, faced significant challenges this year as crude oil prices bottomed out in response to the coronavirus pandemic. The company adapted by consolidating operations and relocating to Houston, Texas, for cost-cutting reasons. It said in May that it would implement executive pay cuts, and close El Dorado and Canada offices in the third quarter, displacing some 200 workers.
Adjusted earnings before interest, taxes, depreciation, amortization and exploration expenses was $262 million, or $18.46 per barrel of oil equivalent sold. This missed Stephens Inc's estimate by 4% because of lower than expected oil pricing, analyst Gail Nicholson said in a research brief. Production and capital expenditures of $117 million to continue operations met Stephens' expectations.
In addition to its financial results, Murphy Oil debuted new sustainability goals with plans to reduce green house gas emissions. Diversity and inclusion, and covid-19 efforts are noted in the report.
Murphy Oil generated cash flow of $74 million in the third quarter.
As of Sept. 30, the company had $1.6 billion in liquidity and $2.8 billion in debt.
The company said it expects fourth-quarter production to be up to 154,000 barrels of oil equivalent per day.
Murphy Oil shares fell 41 cents, or 5.3%, to close Thursday at $7.28 on the New York Stock Exchange.