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Oil and gas producer EOG Resources Inc on Thursday boosted its annual dividend by 10% after its fourth-quarter adjusted profit rose over 60% from the third, helped by a recent recovery in commodity prices.
Easing of COVID-19 related restrictions has sparked optimism among shale producers after they endured a year of destruction in crude prices and demand. U.S. crude rose to $63.53 on Thursday, its highest since May 2019.
Despite the higher commodity prices, EOG forecast this year's spending to be between $3.7 billion and $4.1 billion and will keep its output flat compared to the fourth-quarter rate of 801,500 barrels of oil-equivalent per day.
EOG's forecast of keeping production and spending flat or lower matches rivals like Diamondback Energy Inc and Occidental Petroleum Corp and highlights a recurring theme in shale that calls for prioritizing balance sheet cleanups above output growth.
"The 2021 capital plan is consistent with the strategy we have followed over the last year of not growing production in an oversupplied market," EOG Chief Executive Officer Bill Thomas said in a statement.
Dividend: annual rate at $1.65.
EOG Resources came out with quarterly earnings of $0.71 per share, beating the Zacks Consensus Estimate of $0.38 per share.
This compares to earnings of $1.35 per share a year ago. These figures are adjusted for non-recurring items.
This quarterly report represents an earnings surprise of 86.84%. A quarter ago, it was expected that this oil and gas company would post earnings of $0.16 per share when it actually produced earnings of $0.43, delivering a surprise of 168.75%.
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