After a ‘strategic review,’ Canada’s largest oil sands producer — Suncor Inc. — decided to keep its Petro-Canada brand of retail gas stations after blowout Q4 earnings in a ‘wells to wheels’ strategy that saw it net a cool $10 billion in 2022 earnings..The numbers speak for themselves. Production came in at 763,100 barrels of oil equivalent per day (boe/d) in Q4 — about a quarter of Canada’s oil output compared to 743,300 boe/d in the prior year quarter, primarily driven by increased production from the company’s oil sands assets, which rose to 688,000 boe/d from 666,000 in 2021..Net earnings increased to $2.741 billion ($2.03 per share) in the fourth quarter of 2022, compared to $1.553 billion ($1.07 per share) in the prior year quarter. Full year earnings of $9.1 billion were more than double $4.1 billion in 2021. Cash flow, a measure of a company’s ability to fund capital projects, came in at a record $18 billion. Suncor returned about $8 billion back to shareholders in the form of buybacks..Consequently, its board of directors approved a quarterly dividend of 52 cents per share, a 23.8% increase over the fourth quarter of 2021 and the highest quarterly dividend per share in the company’s history. It adds up to a 13% cash return on investment (ROI). .And despite pressures from activist shareholders, the company decided to remain true to its ‘Canuckistan’ roots by keeping Petro-Canada, which sells about 18% of all the gasoline sold in Canada. .On a conference call, interim CEO Kris Smith said the company would embark on a five-year plan to “optimize” its retail network by keeping “high volume, high value” sites and either closing or selling the rest to third party operators. About half Petro-Canada stations are privately owned..The Petro-Canada brand has a bit of a mixed history in Western Canada. It’s emblematic of attempts through the National Energy Program (NEP) to control 51% of the domestic oil industry. Suncor’s head office in Calgary — formerly Petro-Canada Plaza — was dubbed ‘Red Square’ both for its ruddy granite facade and the politics behind it. .The irony is Canadian companies, including Suncor, presently control upwards 90% of the oil sands production in the country, far more than the senior Trudeau could have ever hoped for when it was founded by his Liberal government in 1975. Suncor bought the troubled company in 2009 in what was the largest corporate takeover in Canadian history. .And it’s looking to go for more. In January Suncor announced the $688 million acquisition of BC mining giant Teck’s stake in the Fort Hills oil sands mine — a Petro-Canada project. It originally wanted to spend $1 billion if not for French giant TotalEnergies legal injunction to block the sale. Suncor had to adjust full year 2023 guidance downwards as a result..In the meantime, it's proceeding to sell off its wind and solar assets to focus on homegrown oil — as all good oil companies should do — and divest of its North Sea European assets, a holdover from its Petro-Canada days, and refocus operations in Canada. .Despite the positive numbers, Suncor shares (SU:TSE) were down about a loonie in Toronto yesterday on the back of lower oil prices, to $46.55.
After a ‘strategic review,’ Canada’s largest oil sands producer — Suncor Inc. — decided to keep its Petro-Canada brand of retail gas stations after blowout Q4 earnings in a ‘wells to wheels’ strategy that saw it net a cool $10 billion in 2022 earnings..The numbers speak for themselves. Production came in at 763,100 barrels of oil equivalent per day (boe/d) in Q4 — about a quarter of Canada’s oil output compared to 743,300 boe/d in the prior year quarter, primarily driven by increased production from the company’s oil sands assets, which rose to 688,000 boe/d from 666,000 in 2021..Net earnings increased to $2.741 billion ($2.03 per share) in the fourth quarter of 2022, compared to $1.553 billion ($1.07 per share) in the prior year quarter. Full year earnings of $9.1 billion were more than double $4.1 billion in 2021. Cash flow, a measure of a company’s ability to fund capital projects, came in at a record $18 billion. Suncor returned about $8 billion back to shareholders in the form of buybacks..Consequently, its board of directors approved a quarterly dividend of 52 cents per share, a 23.8% increase over the fourth quarter of 2021 and the highest quarterly dividend per share in the company’s history. It adds up to a 13% cash return on investment (ROI). .And despite pressures from activist shareholders, the company decided to remain true to its ‘Canuckistan’ roots by keeping Petro-Canada, which sells about 18% of all the gasoline sold in Canada. .On a conference call, interim CEO Kris Smith said the company would embark on a five-year plan to “optimize” its retail network by keeping “high volume, high value” sites and either closing or selling the rest to third party operators. About half Petro-Canada stations are privately owned..The Petro-Canada brand has a bit of a mixed history in Western Canada. It’s emblematic of attempts through the National Energy Program (NEP) to control 51% of the domestic oil industry. Suncor’s head office in Calgary — formerly Petro-Canada Plaza — was dubbed ‘Red Square’ both for its ruddy granite facade and the politics behind it. .The irony is Canadian companies, including Suncor, presently control upwards 90% of the oil sands production in the country, far more than the senior Trudeau could have ever hoped for when it was founded by his Liberal government in 1975. Suncor bought the troubled company in 2009 in what was the largest corporate takeover in Canadian history. .And it’s looking to go for more. In January Suncor announced the $688 million acquisition of BC mining giant Teck’s stake in the Fort Hills oil sands mine — a Petro-Canada project. It originally wanted to spend $1 billion if not for French giant TotalEnergies legal injunction to block the sale. Suncor had to adjust full year 2023 guidance downwards as a result..In the meantime, it's proceeding to sell off its wind and solar assets to focus on homegrown oil — as all good oil companies should do — and divest of its North Sea European assets, a holdover from its Petro-Canada days, and refocus operations in Canada. .Despite the positive numbers, Suncor shares (SU:TSE) were down about a loonie in Toronto yesterday on the back of lower oil prices, to $46.55.
