Chesapeake Energy Corporation (NYSE: CHK) shares surged by 19 percent on Thursday after the company reported its fourth quarter and full year financial results and topped analysts’ estimates in both earnings and revenue.
For the fourth quarter, Chesapeake Energy reported revenue of $2.52 billion, beating analysts’ estimates of $2.3 billion. The company reported an EPS of $0.30, beating analysts’ estimates of $0.24.
Oil production increased by 11 percent in the fourth quarter year over year, aided by a decrease in expenses of approximately $510 million, down 18 percent year over year.
Revenue was boosted by higher commodity prices, as U.S. crude prices gained 17 percent in the fourth quarter.
For 2017, average production increased to 547,800 barrels of oil equivalent (boe) per day, increasing 3 percent year over year.
““I am very pleased with our fourth quarter and full year 2017 performance, as we made significant progress toward our goals of reducing our debt, increasing cash flow generation and margin enhancement.” said Doug Lawler, Chesapeake’s Chief Executive Officer.
“Over the last four years, we have fundamentally transformed our business, removing financial and operational complexity, significantly improving our balance sheet, and addressing numerous legacy issues that have affected past performance. Chesapeake Energy continues to get stronger, and we believe we are well positioned to create meaningful shareholder value in the years ahead.” added Lawler.
For 2018, Chesapeake forecasts total production, adjusted for asset sales, to grow 3 percent year over year, as oil is expected to increase by 5 percent. The company will increase production but decrease capital expenditures by 12 percent in the range of $1.97 billion and $2.37 billion.
Chesapeake shares are down 21 percent year to date now.