Core Points - Cenovus Energy Inc. will redeem its 4.591% Series 5 Preferred Shares on March 31, 2025, for a total of $200 million, funded primarily from cash on hand [1] - The final quarterly dividend of $0.28694 per Series 5 Preferred Share will be paid on March 31, 2025, to shareholders of record as of March 14, 2025 [2] - The company is an integrated energy firm with operations in oil and natural gas production, upgrading, refining, and marketing in Canada and the United States [7]

Financial Performance - Cenovus Energy Inc. reported fourth-quarter 2024 adjusted earnings per share of 5 cents, missing the Zacks Consensus Estimate of 18 cents and declining from 29 cents a year ago [1] - Total quarterly revenues were $8.4 billion, below the Zacks Consensus Estimate of $9.9 billion and down from $9.6 billion in the previous year [1] Operational Performance - The Oil Sands unit's operating margin was C$2.34 billion, an increase from C$1.96 billion year-over-year, with daily oil sand production at 626.6 thousand barrels, up 2.3% year-over-year [3] - The Conventional unit's operating margin decreased to C$88 million from C$123 million, with daily liquid production dropping to 24.5 thousand barrels from 28.9 thousand barrels [4] - The Offshore segment's operating margin fell to C$242 million from C$370 million, with daily offshore liquid production down to 19.5 thousand barrels from 21.1 thousand barrels [4] - The Canadian Manufacturing unit's operating margin was C$47 million, down from C$126 million, processing 104.4 thousand barrels per day [5] - The U.S. Manufacturing unit reported an operating loss of C$443 million, compared to a loss of C$430 million a year earlier, with crude oil processed volumes increasing to 562.3 MBbl/D from 478.8 MBbl/D [5] Expenses - Transportation and blending expenses decreased to C$2.82 billion from C$2.89 billion year-over-year, while expenses for purchased products increased to C$1 billion from C$663 million [6] Capital Investment & Balance Sheet - Cenovus made a total capital investment of C$1.48 billion in the quarter, with cash and cash equivalents of C$3.10 billion and long-term debt of C$7.3 billion as of December 31, 2024 [7] Guidance - For 2025, Cenovus expects total upstream production to be between 805-845 MBoe/d, indicating an increase from 797.2 MBoe/d in 2024, and downstream throughput projected in the range of 650-685 MBbls/d, up from 646.9 MBbls/d in 2024 [9] - The company anticipates capital expenditure to be between $4.6-$5 billion for the year [9]

Group 1 - The primary goal of the Cash Flow Kingdom Income Portfolio is to achieve an overall yield in the range of 7% - 10% by combining various income streams for a steady portfolio payout [1] - Cenovus Energy Inc. (NYSE: CVE) reported weak profitability in Q4 due to poor results from its refining business, but cash generation for 2024 remains strong [1] - The article emphasizes the importance of cash flows and access to capital in investment strategies, particularly in the energy sector [1] Group 2 - The author, Jonathan Weber, has been active in the stock market and focuses on value and income stocks, occasionally covering growth stocks [2] - The article does not provide any specific investment recommendations or advice regarding the suitability of investments for particular investors [4]

Financial Data and Key Metrics Changes - In 2024, Cenovus generated over CAD 8 billion of adjusted funds flow and returned about CAD 3.2 billion to shareholders through dividends, share repurchases, and the redemption of preferred shares [14] - The company achieved its CAD 4 billion net debt target in 2024, marking a significant milestone [14] - In Q4 2024, Cenovus generated CAD 2.3 billion of operating margin, approximately CAD 1.6 billion of adjusted funds flow, and about CAD 125 million of free funds flow [15] Business Line Data and Key Metrics Changes - Upstream production grew by about 2.5% from 790,000 boe per day in 2023 to 797,000 boe per day in 2024, with Oil Sands production increasing by about 3% year-over-year to 610,700 boe per day [10] - Total offshore production increased to about 67,000 boe per day, with approximately 59,000 boe per day from the Asia Pacific business [11] - In the Downstream segment, total crude throughput increased by 87,000 barrels per day year-over-year to 647,000 barrels per day in 2024 [12] Market Data and Key Metrics Changes - The weighted average crack spread in the Downstream averaged $8.20 per barrel in Q4, a decline of 45% compared to Q3 [18] - U.S. Refining throughput in Q4 was 562,000 barrels per day, representing a utilization rate of 92%, an increase of 3% quarter-over-quarter and 17% year-over-year [20] - Canadian Refining throughput was 104,000 barrels per day, with a utilization rate of about 97%, an increase of 5% quarter-over-quarter [22] Company Strategy and Development Direction - Cenovus plans a capital investment budget of CAD 4.6 to CAD 5 billion for 2025, marking the final year of a three-year growth investment cycle [26] - The company expects to bring on about 150,000 boe per day by 2028, which will drive growth in free funds flow [27] - The focus remains on improving operational performance and driving costs down in the Downstream segment [19] Management's Comments on Operating Environment and Future Outlook - Management highlighted a strong operational performance in 2024, with record production from Oil Sands assets and improving Downstream performance [30] - The company anticipates a year-over-year reduction in unit operating costs excluding turnarounds of 15% and 5% for Canadian and U.S. Refining businesses respectively [29] - Management expressed confidence in achieving free cash flow growth and significant returns to shareholders in the coming years [30] Other Important Information - Cenovus achieved its best-ever process safety performance in 2024, reducing Tier 1 and Tier 2 process safety events by 44% compared to 2023 [7] - The company completed major turnarounds at key facilities, including the Lloyd Upgrader and the Lima Refinery, which are expected to enhance operational performance [13] Q&A Session Summary Question: U.S. Refinery market capture expectations - Management indicated that in a normalized environment, U.S. market capture should settle in the 70% plus range [34] Question: Accelerating buybacks versus preferred redemptions - Management acknowledged the opportunity for buybacks but emphasized the importance of maintaining a disciplined capital structure and not leaning on the balance sheet [36][39] Question: U.S. Downstream operations and upcoming projects - Management discussed ongoing efforts to improve reliability and mechanical availability of assets, highlighting significant work done at the Lloydminster Upgrader and U.S. assets [45][46] Question: West White Rose drilling plans - Drilling is expected to start in Q4 of next year, with first production anticipated in the mid-first half of 2026 [53] Question: Heavy-light differentials impact - Management noted that a narrow differential is beneficial for the company, with expectations for continued narrow differentials due to increased capacity from Trans Mountain [114][115] Question: Impact of tariffs on capital spending plans - Management stated that tariffs would not impact 2025 spending plans, emphasizing a focus on completing important projects [121]

Financial Performance - Revenues for Q4 2024 were $12,813 million, a decrease of 2.4% compared to Q4 2023's $13,134 million[3] - Net earnings for Q4 2024 were $146 million, down 80.4% from $743 million in Q4 2023[3] - The company reported a comprehensive income of $898 million for Q4 2024, compared to $497 million in Q4 2023, marking an increase of 80.8%[3] - The basic net earnings per share for 2024 were $1.68, down from $2.15 in 2023, a decrease of 21.8%[3] - Net earnings for Q4 2024 were $146 million, a decrease of 80% from $743 million in Q4 2023[13] - Total revenues for Q4 2024 increased to $7,326 million, up 6.3% from $6,895 million in Q4 2023[21] - Total external sales for the twelve months ended December 31, 2024, increased to $57,726 million, up 4.5% from $55,474 million in 2023[26] - Segment income for the twelve months ended December 31, 2024, was $5,863 million, a decrease of 7.0% from $6,300 million in 2023[26] Assets and Liabilities - Total assets increased to $56,539 million in 2024, up from $53,915 million in 2023, representing a growth of 4.8%[7] - Total liabilities increased to $26,770 million in 2024, compared to $25,203 million in 2023, reflecting a rise of 6.2%[7] - The company’s inventories increased to $4,496 million in 2024, up from $4,030 million in 2023, reflecting an increase of 11.6%[7] - The company’s total current tax expense for 2024 was $1,403 million, an increase from $1,181 million in 2023[65] - The total non-current assets as of December 31, 2024, amounted to $44,452 million, up from $43,058 million in 2023, indicating a growth of 3.2%[34] - Total current liabilities rose to $7,362 million as of December 31, 2024, compared to $6,210 million in 2023[137] Cash Flow and Investments - Cash and cash equivalents rose to $3,093 million, an increase of 39% from $2,227 million in 2023[7] - Cash from operating activities for the twelve months ended December 31, 2024, was $9,235 million, an increase of 25% compared to $7,388 million in 2023[13] - Capital investment for the twelve months ended December 31, 2024, was $5,015 million, an increase of 16.6% from $4,298 million in 2023[13] - Capital expenditures for Q4 2024 totaled $1,481 million, compared to $1,172 million in Q4 2023, marking a 26.3% increase[36] - The company reported a net finance cost of $514 million for the twelve months ended December 31, 2024, slightly down from $538 million in 2023[46] Debt and Equity - The company’s long-term debt increased to $7,342 million in 2024 from $7,108 million in 2023, a growth of 3.3%[7] - Long-term debt rose to $7,534 million in 2024 from $7,108 million in 2023, an increase of 6%[79] - Net debt decreased to $4,614 million as of December 31, 2024, down from $5,060 million in 2023, a reduction of 8.8%[85] - The net debt to adjusted EBITDA ratio remained stable at 0.5 times for both 2024 and 2023[85] - The company repurchased and canceled 55.9 million common shares in 2024 at an average price of $25.38 per share, totaling $1.4 billion, which reduced paid-in surplus by $966 million[96] Operational Metrics - Operating expenses for Q4 2024 were $1,627 million, slightly up from $1,563 million in Q4 2023, indicating a rise of 4.1%[3] - Operating margin for the total upstream segment increased to $2,670 million in Q4 2024, compared to $2,455 million in Q4 2023, reflecting a 8.8% growth[21] - The operating margin for the upstream segment for the twelve months ended December 31, 2024, was $11,121 million, up 12.7% from $9,870 million in 2023[24] Foreign Exchange and Risk Management - The company reported a foreign exchange gain of $462 million for the twelve months ended December 31, 2024, compared to a loss of $67 million in 2023[26] - The company had foreign exchange contracts with a notional value of $250 million as of December 31, 2024, compared to $nil in 2023[124] - The unrealized loss on risk management for the twelve months ended December 31, 2024, was $12 million, a significant improvement from a loss of $52 million in 2023[122] Commitments and Future Outlook - As of December 31, 2024, total commitments amount to $27.28 billion, with significant future payments in transportation and storage commitments totaling $24.26 billion[140] - The company has $1.8 billion related to transportation and storage commitments with HMLP, and outstanding letters of credit totaling $355 million[141] - The forward commodity prices for West Texas Intermediate (WTI) crude oil are projected to increase to $79.22 per barrel by 2029, with an average annual increase of 2% thereafter[53]

Group 1: Earnings Performance - Cenovus Energy reported quarterly earnings of $0.05 per share, missing the Zacks Consensus Estimate of $0.18 per share, and down from $0.29 per share a year ago, representing an earnings surprise of -72.22% [1] - The company posted revenues of $8.4 billion for the quarter ended December 2024, missing the Zacks Consensus Estimate by 15.98%, compared to year-ago revenues of $9.65 billion [2] - Over the last four quarters, Cenovus has surpassed consensus EPS estimates only once [2] Group 2: Stock Performance and Outlook - Cenovus shares have increased by approximately 3.2% since the beginning of the year, while the S&P 500 has gained 4.5% [3] - The company's earnings outlook, including current consensus earnings expectations for upcoming quarters, will be crucial for investors [4] - The current consensus EPS estimate for the coming quarter is $0.33 on revenues of $9.66 billion, and for the current fiscal year, it is $1.49 on revenues of $38.36 billion [7] Group 3: Industry Context - The Oil and Gas - Integrated - Canadian industry, to which Cenovus belongs, is currently in the top 22% of over 250 Zacks industries, indicating a favorable industry outlook [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact stock performance [5] - The current estimate revisions trend for Cenovus is mixed, resulting in a Zacks Rank 3 (Hold) for the stock, suggesting it is expected to perform in line with the market in the near future [6]

Financial Performance - Cenovus Energy Inc. reported over $2.0 billion in cash from operating activities for Q4 2024, down from $2.5 billion in Q3 2024 [14][22] - Adjusted funds flow for Q4 2024 was $1.6 billion, a decrease from $2.0 billion in the previous quarter [14][22] - The company generated $123 million in free funds flow in Q4 2024, compared to $614 million in Q3 2024 [14][22] - Net earnings for Q4 2024 were $146 million, significantly lower than $820 million in Q3 2024 [14][22] Production and Operations - Total upstream production reached 816,000 barrels of oil equivalent per day (BOE/d) in Q4 2024, a 6% increase from the previous quarter [6][9] - Oil Sands production set a new quarterly record at 628,500 BOE/d [6][9] - Total downstream throughput increased to 666,700 barrels per day (bbls/d), up from 642,900 bbl/d in Q3 2024 [11][12] Revenue and Margins - Total revenues for Q4 2024 were $12.8 billion, down from $13.8 billion in Q3 2024, primarily due to lower commodity prices [7][21] - The total operating margin was $2.3 billion, slightly lower than $2.4 billion in the previous quarter [8][21] - Upstream operating margin remained stable at $2.7 billion, while the downstream segment experienced a shortfall of $396 million due to weak refining crack spreads [8][21] Shareholder Returns - The company returned $706 million to shareholders in Q4 2024, including $108 million through share purchases and $348 million in dividends [32][22] - For the full year 2024, Cenovus returned $3.2 billion to shareholders [32][22] Growth Projects - Cenovus achieved significant milestones in its major upstream growth projects, including the mechanical completion of the Narrows Lake pipeline and the West White Rose project [17][18] - The optimization project at Foster Creek is 64% complete and on schedule for startup in 2026 [17][18] Reserves - At the end of 2024, Cenovus's total proved reserves were approximately 5.7 billion BOE, with a proved reserves life index of about 19 years [27][27]

The upcoming report from Cenovus Energy (CVE) is expected to reveal quarterly earnings of $0.18 per share, indicating a decline of 37.9% compared to the year-ago period. Analysts forecast revenues of $9.99 billion, representing an increase of 3.6% year over year.The current level reflects an upward revision of 15.1% in the consensus EPS estimate for the quarter over the past 30 days. This demonstrates how the analysts covering the stock have collectively reappraised their initial projections over this perio ...

Analysts on Wall Street project that Cenovus Energy (CVE) will announce quarterly earnings of $0.18 per share in its forthcoming report, representing a decline of 37.9% year over year. Revenues are projected to reach $9.99 billion, increasing 3.6% from the same quarter last year.Over the last 30 days, there has been an upward revision of 15.1% in the consensus EPS estimate for the quarter, leading to its current level. This signifies the covering analysts' collective reconsideration of their initial forecas ...

Wall Street analysts expect Cenovus Energy (CVE) to post quarterly earnings of $0.18 per share in its upcoming report, which indicates a year-over-year decline of 37.9%. Revenues are expected to be $9.99 billion, up 3.6% from the year-ago quarter.Over the last 30 days, there has been an upward revision of 15.1% in the consensus EPS estimate for the quarter, leading to its current level. This signifies the covering analysts' collective reconsideration of their initial forecasts over the course of this timefr ...