NYSE$DVN

Devon Energy Corp · Q2 2020 earnings

Q2 2020 earnings · · Investor relations

Briefing

Devon Energy's Q2 2020 performance was marked by operational efficiency and strategic initiatives.

Devon Energy reported a net loss of $670 million for Q2 2020, impacted by a $593 million unrealized change in the fair value of the company's derivative position. However, the company exceeded oil production guidance, reduced capital expenditures, and improved operating costs. Strategic initiatives include accelerating the Barnett Shale divestiture, declaring a $100 million special dividend, and planning to reduce costs and debt.

  • Capital expenditures were 10% below guidance at $203 million due to efficiency gains.
  • Oil production totaled 153,000 barrels per day, exceeding midpoint guidance by 3,000 barrels per day.
  • Operating costs decreased 14% year-over-year.
  • The company exited the quarter with $4.7 billion of liquidity, including $1.7 billion in cash.

Headline financials

Total Revenue

$394M

Previous: $1.92B-79.5%
EPS (adj)

-$0.18

Previous: $0.23-178.3%
Total Production (Boe/d)

149.0K

Previous: 120.2K+24.0%
Capital Expenditures

-$1M

Previous: -$13M+92.3%
Free Cash Flow

-$671M

Previous: $482M-239.2%
Net Income

-$670M

Previous: $495M-235.4%
Operating Income

-$2.38B

Previous: $906M-362.8%
Gross Profit

$394M

Previous: $1.21B-67.4%
Cash & Equivalents

$1.47B

Previous: $3.47B-57.5%
Total Assets

$10.4B

Previous: $16.6B-37.8%
Stock-Based Comp

$19M

Previous: $25M-24.0%

Revenue & EPS history

Devon Energy · Revenue · Quarterly

$394M

Q2 2020-79.5%vs Q2 2019
Beat estimate in 10 of 16 quarters(63%)
ActualEstimate

Forward guidance

Devon is lowering its full-year 2020 E&P capital expenditure guidance to a range of $950 million to $1 billion and is raising its full-year oil production forecast in 2020 to a range of 148,000 to 152,000 barrels per day.

Tailwinds

  • Capital efficiency gains in the Delaware Basin.
  • Strong base production performance across its diversified asset portfolio.
  • Lower production costs.
  • Further reductions in G&A expense.
  • Focus on appraisal work in the emerging Niobrara oil play.

Headwinds

  • Timing of completion activity is expected to decline oil production to a range of 138,000 to 143,000 barrels per day.
  • Volatility of oil, gas and NGL prices.
  • Uncertainties inherent in estimating oil, gas and NGL reserves.
  • Regulatory restrictions, compliance costs and other risks relating to governmental regulation, including with respect to environmental matters.
  • Risks related to regulatory, social and market efforts to address climate change.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q2 2020

Historical avgQ2 2020

-0.0%

Avg return

Earnings day

+2.0%

Avg return

5 days after

+2.9%

Avg return

30 days after

55%

40 / 73 earnings

Positive

+13.6%

Q2 2020

Best reaction

-12.8%

Q3 2022

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-4.7%-8.3%-13.2%
Q4 2025+1.5%-0.8%+10.5%
Q3 2025+0.4%+8.7%+15.9%
Q2 2025-0.2%+2.7%+7.1%
Q1 2025-1.1%+9.7%+5.6%
Q4 2024+7.7%+7.0%+3.6%
Q3 2024+2.2%-0.7%-8.1%
Q2 2024+4.1%+8.3%+1.4%
Q1 2024-1.6%-0.6%-4.1%
Q4 2023+0.5%+1.3%+14.5%
Q3 2023-5.4%-2.4%-7.0%
Q2 2023-7.9%-5.9%-5.4%
Q1 2023-2.4%-5.6%-0.6%
Q4 2022-10.0%-16.1%-27.2%
Q3 2022-12.8%-7.6%-11.7%
Q2 2022-3.5%-9.9%+12.4%
Q1 2022+10.5%+19.8%+31.5%
Q4 2021+3.0%+4.8%+10.1%
Q3 2021-0.0%+3.8%-1.0%
Q2 2021-0.8%+6.0%+15.0%
Q1 2021+6.8%+11.0%+32.0%
Q4 2020+8.8%+4.3%+11.9%
Q3 2020+10.2%+19.0%+82.5%
Q2 2020+13.6%+14.2%-1.2%
Q1 2020+0.6%+11.2%+11.4%
Q4 2019-0.4%-8.1%-71.3%
Q3 2019-2.2%+1.5%-2.2%
Q2 2019+0.4%-0.0%-2.3%
Q1 2019-2.7%-4.5%-21.2%
Q4 2018+6.5%+4.3%+11.4%
Q3 2018+2.3%-0.3%-16.2%
Q2 2018-3.5%-4.5%-4.3%
Q1 2018+5.2%+4.2%+14.4%
Q4 2017-10.4%-7.9%-5.3%
Q3 2017+8.6%+9.1%+7.0%
Q2 2017+0.3%+1.1%-5.7%
Q1 2017-2.9%-3.3%-12.8%
Q4 2016-2.3%-2.4%-10.0%
Q3 2016+4.4%+6.1%+26.3%
Q2 2016+5.8%+10.0%+21.7%
Q1 2016-9.4%
Q4 2015-6.3%
Q3 2015+7.8%
Q2 2015-2.9%
Q1 2015-2.2%
Q4 2014-3.8%
Q3 2014+5.3%
Q2 2014-1.5%
Q1 2014+1.1%
Q4 2013+2.6%
Q3 2013-6.3%
Q2 2013+5.1%
Q1 2013+2.9%
Q4 2012-9.4%
Q3 2012-9.4%
Q2 2012-6.3%
Q1 2012-5.9%
Q4 2011+0.1%
Q3 2011+5.8%
Q2 2011-7.8%
Q1 2011+0.4%
Q4 2010+3.5%
Q3 2010+3.8%
Q2 2010-0.7%
Q1 2009-4.3%
Q1 2010+2.2%
Q4 2007+0.7%
Q4 2009+0.7%
Q3 2009+1.4%
Q3 2008+1.4%
Q2 2009+0.9%
Q2 2008+0.9%
Q4 2008+0.9%

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