Noble's 2Q profit rises but misses expectations

Noble Energy says 2Q profit up by 29 percent despite production problem in the Gulf of Mexico

Associated Press

HOUSTON (AP) -- Noble Energy Inc.'s second-quarter profit rose 29 percent, but earnings and revenue both failed to meet Wall Street expectations as its oil production was hurt by the idling of a rig in the deepwater Gulf of Mexico and late-winter storms in Colorado.

The company, which has operations in the U.S. DJ Basin and Marcellus Shale, Gulf of Mexico and offshore West Africa and the eastern Mediterranean, also booked slightly lower oil prices in the latest period — $96.84 per barrel on average for crude oil and condensates compared with $99.67 per barrel a year earlier. Natural gas revenue nearly doubled as U.S. natural gas prices spiked 92 percent to an average of $4.04 per thousand cubic feet, but that revenue accounts for less than a quarter of the company's total.

The Houston company's new Alen field in West Africa started production late in the quarter, which Noble Energy said was significantly ahead of schedule. Full operations are expected by the end of the third quarter. For the rest of the year, Noble Energy said it expects to set production records and is exploring prospects in Nevada and off the coast of Nicaragua, "both of which have the potential to be new core areas for Noble Energy," said Chairman and CEO Charles Davidson, in a statement.

Net income climbed to $377 million, or $1.04 per share, from $292 million, or 79 cents per share, a year earlier. Excluding gains on derivatives and other items, the company would have earned 69 cents per share in the latest period, short of analysts' average forecast of 74 cents per share, according to FactSet.

Revenue rose 19 percent to $1.15 billion, also below analysts' estimate of $1.20 billion.

The shares fell 65 cents to $63.89 in afternoon trading. The stock's still up about 50 percent in the past 12 months, and peaked earlier this month at an all-time high of $66.30.

Noble reaffirmed its outlook for full-year volumes of 270,000 to 282,000 barrels of oil equivalent a day. That includes third-quarter average volumes of 285,000 to 295,000 barrels of oil equivalent a day, which represents a 12 percent higher midpoint than the second quarter due to the ramp up of Alen, additional natural gas sales from the Tamar field offshore Israel and the continued speed-up of production in the DJ Basin and the Marcellus Shale.