November 5, 2019 / 9:34 PM / 4 months ago

Devon Energy beats estimates, raises forecast for oil output

FILE PHOTO: A pump jack operates at a well site leased by Devon Energy Production Company near Guthrie, Oklahoma September 15, 2015. REUTERS/Nick Oxford

(Reuters) - Devon Energy Corp beat Wall Street estimates for adjusted quarterly profit on Tuesday and raised its full-year oil output forecast, as the U.S. oil and gas producer kept a check on expenses.

The company’s shares rose 4.4% to $24 in after-market trading.

Total expenses at Devon, which has been undertaking cost-cutting efforts, fell 23.9% to $1.65 billion.

The company has been shedding assets in a bid to become a pure-play U.S. oil producer. It sold its Canadian assets for $2.8 billion earlier this year and said it was in negotiations with buyers for its gas-rich Barnett shale patch in the United States.

Devon, which has operations in the Delaware and Eagle Ford basins, said its 2019 production forecast now estimates oil output to increase between 20% and 21%, a 5.5% improvement from its original projection.

The company’s net income attributable to shareholders fell to $109 million, or 27 cents per share, in the third quarter ended Sept. 30, from $2.54 billion, or $5.14 per share, a year earlier, which included a gain from the sale of its stake in pipeline operator EnLink Midstream.

On an adjusted basis, Devon earned 29 cents per share, beating analysts’ average estimate of 16 cents per share, according to IBES data from Refinitiv.

Production rose 2.4% to 428,000 barrels of oil equivalent per day in the reported quarter.

Reporting by Taru Jain; Editing by Shounak Dasgupta

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