[Interim Consolidated Financial Statements (Unaudited)](index=1&type=section&id=Interim%20Consolidated%20Financial%20Statements%20(unaudited)) [Consolidated Statements of Earnings (Loss)](index=3&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20EARNINGS%20(LOSS)%20(UNAUDITED)) Cenovus reported 2023 net earnings of $4.1 billion on $52.2 billion revenue, a decrease from 2022 Consolidated Earnings Summary | For the periods ended December 31, ($ millions, except per share amounts) | Three Months 2023 | Three Months 2022 | Twelve Months 2023 | Twelve Months 2022 | | :--- | :--- | :--- | :--- | :--- | | **Revenues (Net of Royalties)** | 13,134 | 14,063 | 52,204 | 66,897 | | **Expenses** | 12,160 | 13,026 | 47,164 | 58,166 | | **Earnings Before Income Tax** | 974 | 1,037 | 5,040 | 8,731 | | **Net Earnings (Loss)** | 743 | 784 | 4,109 | 6,450 | | **Basic Net Earnings Per Share ($)** | 0.39 | 0.40 | 2.15 | 3.29 | | **Diluted Net Earnings Per Share ($)** | 0.39 | 0.39 | 2.12 | 3.20 | [Consolidated Statements of Comprehensive Income (Loss)](index=4&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20COMPREHENSIVE%20INCOME%20(LOSS)%20(UNAUDITED)) Full year 2023 comprehensive income was $3.8 billion, down from $7.2 billion in 2022 due to lower net earnings Consolidated Comprehensive Income Summary | For the periods ended December 31, ($ millions) | Three Months 2023 | Three Months 2022 | Twelve Months 2023 | Twelve Months 2022 | | :--- | :--- | :--- | :--- | :--- | | **Net Earnings (Loss)** | 743 | 784 | 4,109 | 6,450 | | **Other Comprehensive Income (Loss), Net of Tax** | (246) | (170) | (262) | 786 | | *Foreign Currency Translation Adjustment* | *(243)* | *(183)* | *(274)* | *713* | | **Comprehensive Income (Loss)** | 497 | 614 | 3,847 | 7,236 | [Consolidated Balance Sheets](index=5&type=section&id=CONSOLIDATED%20BALANCE%20SHEETS%20(UNAUDITED)) Total assets decreased to $53.9 billion in 2023, while liabilities reduced, increasing shareholders' equity Balance Sheet Summary | As at December 31, ($ millions) | 2023 | 2022 | | :--- | :--- | :--- | | **Total Current Assets** | 9,708 | 12,430 | | *Cash and Cash Equivalents* | *2,227* | *4,524* | | **Total Assets** | 53,915 | 55,869 | | **Total Current Liabilities** | 6,210 | 8,021 | | **Long-Term Debt** | 7,108 | 8,691 | | **Total Liabilities** | 25,203 | 28,280 | | **Shareholders' Equity** | 28,698 | 27,576 | | **Total Liabilities and Equity** | 53,915 | 55,869 | [Consolidated Statements of Equity](index=6&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20EQUITY%20(UNAUDITED)) Shareholders' equity grew to $28.7 billion in 2023, driven by net earnings, despite share repurchases and dividends Changes in Shareholders' Equity (2023) | ($ millions) | Amount | | :--- | :--- | | **As at December 31, 2022** | **27,576** | | Net Earnings | 4,109 | | Other Comprehensive Loss, Net of Tax | (262) | | Purchase of Common Shares Under NCIB | (1,061) | | Warrants Purchased and Cancelled | (713) | | Base Dividends on Common Shares | (990) | | **As at December 31, 2023** | **28,698** | [Consolidated Statements of Cash Flows](index=7&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS%20(UNAUDITED)) Cash from operating activities decreased to $7.4 billion in 2023, leading to a net $2.3 billion decrease in cash Cash Flow Summary | For the twelve months ended December 31, ($ millions) | 2023 | 2022 | | :--- | :--- | :--- | | **Cash From Operating Activities** | 7,388 | 11,403 | | **Cash Used in Investing Activities** | (5,295) | (2,314) | | **Cash Used in Financing Activities** | (4,313) | (7,676) | | **Increase (Decrease) in Cash and Cash Equivalents** | (2,297) | 1,651 | | **Cash and Cash Equivalents, End of Period** | 2,227 | 4,524 | [Notes to the Interim Consolidated Financial Statements](index=8&type=section&id=NOTES%20TO%20THE%20INTERIM%20CONSOLIDATED%20FINANCIAL%20STATEMENTS%20(UNAUDITED)) This section details business segments, accounting policies, acquisitions, debt, and financial instruments for 2023 [Note 1: Description of Business and Segmented Disclosures](index=8&type=section&id=1.%20DESCRIPTION%20OF%20BUSINESS%20AND%20SEGMENTED%20DISCLOSURES) Cenovus operates Upstream and Downstream segments, with 2023 income of $6.0 billion and $0.5 billion - Cenovus's operations are divided into five reportable segments: Oil Sands, Conventional, and Offshore (Upstream), and Canadian Refining and U.S. Refining (Downstream)[11](index=11&type=chunk) Segment Income (Loss) for Twelve Months Ended Dec 31 ($ millions) | Segment | 2023 | 2022 | | :--- | :--- | :--- | | **Upstream Total** | **6,017** | **8,075** | | Oil Sands | 5,136 | 6,267 | | Conventional | 210 | 851 | | Offshore | 671 | 957 | | **Downstream Total** | **498** | **1,573** | | Canadian Refining | 490 | 491 | | U.S. Refining | 8 | 1,082 | Total Capital Expenditures for Twelve Months Ended Dec 31 ($ millions) | Segment | 2023 | 2022 | | :--- | :--- | :--- | | **Total Upstream** | 3,476 | 2,446 | | **Total Downstream** | 747 | 1,176 | | **Acquisitions** | 427 | 1,621 | | **Total Capital Expenditures** | **4,725** | **5,329** | Total Assets by Segment as at Dec 31 ($ millions) | Segment | 2023 | 2022 | | :--- | :--- | :--- | | Oil Sands | 31,673 | 32,248 | | Conventional | 2,429 | 2,410 | | Offshore | 3,511 | 3,339 | | Canadian Refining | 2,960 | 3,172 | | U.S. Refining | 8,660 | 8,324 | | **Consolidated Total Assets** | **53,915** | **55,869** | [Note 3: Acquisitions](index=16&type=section&id=3.%20ACQUISITIONS) Cenovus acquired the remaining 50% of Toledo refinery for US$378 million, recognizing a $34 million revaluation loss - Cenovus acquired the remaining **50%** of the Toledo refinery from bp on February 28, 2023, for US$**378 million** (C$**514 million**), including working capital[25](index=25&type=chunk) - A non-cash revaluation loss of $**34 million** ($**23 million** after tax) was recognized on the re-measurement of the company's pre-existing **50%** interest in Toledo to its fair value at the acquisition date[28](index=28&type=chunk) - The acquired business contributed $**4.1 billion** in revenues and a net loss of $**85 million** from the acquisition date to December 31, 2023[30](index=30&type=chunk) [Note 6: Impairment Charges and Reversals](index=18&type=section&id=6.%20IMPAIRMENT%20CHARGES%20AND%20REVERSALS) No impairment charges or reversals in 2023, unlike 2022's significant U.S. Refining adjustments - No impairment indicators were identified for Upstream CGUs in 2023, and goodwill testing resulted in no impairments[33](index=33&type=chunk) - As at December 31, 2023, there were no indicators of impairment or impairment reversals for the Company's downstream CGUs[36](index=36&type=chunk) - In 2022, the company recorded a $**1.5 billion** impairment charge for the Toledo and Superior CGUs and reversed impairment charges of $**1.2 billion** for the Borger, Wood River, and Lima CGUs[37](index=37&type=chunk) [Note 8: Per Share Amounts](index=21&type=section&id=8.%20PER%20SHARE%20AMOUNTS) Basic EPS was $2.15 and diluted EPS $2.12 in 2023, with $990 million in common share dividends paid Earnings Per Share (EPS) | For the twelve months ended Dec 31, ($) | 2023 | 2022 | | :--- | :--- | :--- | | **Basic EPS** | 2.15 | 3.29 | | **Diluted EPS** | 2.12 | 3.20 | Common Share Dividends Declared and Paid | For the twelve months ended Dec 31, | 2023 Per Share ($) | 2023 Amount ($M) | 2022 Per Share ($) | 2022 Amount ($M) | | :--- | :--- | :--- | :--- | :--- | | **Base Dividends** | 0.525 | 990 | 0.350 | 682 | | **Variable Dividends** | — | — | 0.114 | 219 | | **Total** | **0.525** | **990** | **0.464** | **901** | - On February 14, 2024, the Board of Directors declared a Q1 2024 base dividend of $**0.140** per common share[44](index=44&type=chunk) [Note 14: Debt and Capital Structure](index=25&type=section&id=14.%20DEBT%20AND%20CAPITAL%20STRUCTURE) Total debt reduced to $7.3 billion in 2023, improving Net Debt to Adjusted EBITDA to 0.5 times Debt and Capitalization Summary | As at December 31, ($ millions) | 2023 | 2022 | | :--- | :--- | :--- | | **Total Debt** | 7,287 | 8,806 | | Less: Cash and Cash Equivalents | (2,227) | (4,524) | | **Net Debt** | **5,060** | **4,282** | | Shareholders' Equity | 28,698 | 27,576 | | **Capitalization** | **33,758** | **31,858** | | Adjusted EBITDA (trailing 12-months) | 10,201 | 13,227 | | **Net Debt to Adjusted EBITDA (times)** | **0.5** | **0.3** | | **Net Debt to Capitalization (percent)** | **15** | **13** | - The company has a committed credit facility consisting of a $**1.8 billion** tranche maturing in 2025 and a $**3.7 billion** tranche maturing in 2026[58](index=58&type=chunk) - For the twelve months ended December 31, 2023, the Company purchased US$**1.0 billion** of its outstanding unsecured notes[59](index=59&type=chunk) [Note 18: Share Capital and Warrants](index=29&type=section&id=18.%20SHARE%20CAPITAL%20AND%20WARRANTS) Cenovus repurchased 43.6 million shares and 45.5 million warrants, totaling $1.8 billion in returns - Under its NCIB, the company purchased and cancelled **43.6 million** common shares in 2023 at a volume weighted average price of $**24.32** per share, for a total of $**1.1 billion**[72](index=72&type=chunk) - On June 14, 2023, Cenovus purchased and cancelled **45.5 million** warrants for a total of $**711 million**[76](index=76&type=chunk) Issued and Outstanding Securities (Year-End) | Security (thousands) | 2023 | 2022 | | :--- | :--- | :--- | | **Common Shares** | 1,871,868 | 1,909,190 | | **Warrants** | 7,625 | 55,720 | [Note 23: Risk Management](index=34&type=section&id=23.%20RISK%20MANAGEMENT) Cenovus manages market, credit, and liquidity risks using derivatives, with 83% of receivables investment-grade - The company is exposed to market risk (commodity prices, FX, interest rates), credit risk, and liquidity risk, which it manages through various strategies including the use of derivative contracts[90](index=90&type=chunk) Net Fair Value of Risk Management Positions (as at Dec 31, 2023) | Position Type | Fair Value Asset (Liability) ($M) | | :--- | :--- | | Futures Contracts Related to Blending | 12 | | Power Swap Contracts | 2 | | Renewable Power Contracts | 18 | | Other Financial Positions | (20) | | **Total Fair Value** | **12** | - Credit risk is mitigated by policy; as of December 31, 2023, **83%** of accounts receivable were with investment-grade counterparties[91](index=91&type=chunk) [Note 25: Commitments and Contingencies](index=38&type=section&id=25.%20COMMITMENTS%20AND%20CONTINGENCIES) Total future commitments reached $28.8 billion, primarily $24.7 billion for transportation and storage Future Commitments as at December 31, 2023 ($ millions) | Commitment Type | Total | | :--- | :--- | | Transportation and Storage | 24,667 | | Product Purchases | 617 | | Real Estate | 898 | | Obligation to Fund HCML | 513 | | Other Long-Term Commitments | 2,101 | | **Total Commitments** | **28,796** | - Transportation commitments include $**13.0 billion** for projects subject to regulatory approval or approved but not yet in service[98](index=98&type=chunk) [Note 26: Prior Period Revisions](index=38&type=section&id=26.%20PRIOR%20PERIOD%20REVISIONS) 2022 comparative figures were revised for consistent accounting, with no impact on net earnings or financial position - Adjustments were made to 2022 comparative data to ensure consistent treatment of inter-segment sales and cost eliminations[102](index=102&type=chunk) - The revisions resulted in reclassifications among Gross Sales, Purchased Product, Transportation and Blending, and Operating expenses but had no impact on net earnings or financial position[102](index=102&type=chunk)[103](index=103&type=chunk)

Cenovus Energy Inc. (NYSE:CVE) Q4 2023 Earnings Conference Call February 15, 2024 11:00 AM ET Company Participants Jason Abbate - Senior Vice President, Investor Relations Jon McKenzie - Chief Executive Officer Keith Chiasson - Executive Vice President, Downstream Kam Sandhar - Executive Vice President, Strategy & Corporate Development Drew Zieglgansberger - Executive Vice President, Natural Gas & Technical Services Rhona DelFrari - Chief Sustainability Officer & Senior Vice President Conference Call Parti ...

Oil Sands 600 Conventional 125 Offshore 65 770 - 810 MBOE/d shareholder | --- | --- | |--------------------------------|----------------| | Upstream Production | 809 MBOE/d | | Downstream Throughput | 579 Mbbls/d | | Cash From Operating Activities | $2,946 million | | Adjusted Funds Flow1 | $2,062 million | | Free Funds Flow1 | $892 million | | Capital Investments | $1,170 million | | Net Debt | $5,060 million | | Long Term Debt | $7,108 million | Committed to maintaining minimum mid-BBB investment grade cr ...

Cenovus Energy (CVE) came out with quarterly earnings of $0.29 per share, beating the Zacks Consensus Estimate of $0.25 per share. This compares to earnings of $0.29 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 16%. A quarter ago, it was expected that this oil company would post earnings of $0.63 per share when it actually produced earnings of $0.72, delivering a surprise of 14.29%.Over the last four quarters, the company h ...

CALGARY, Alberta, Feb. 15, 2024 (GLOBE NEWSWIRE) -- Cenovus Energy Inc. (TSX:CVE) (NYSE:CVE) continued to deliver strong operational performance across the portfolio in the fourth quarter of 2023. The company's upstream assets performed exceptionally well, achieving the second-highest quarterly production rates in Cenovus's history. In its downstream business, the company continued to build operating momentum at its wholly-owned refineries. Upstream and downstream results were negatively impacted by a rapid ...

Cenovus Energy Inc. (CVE) is set to report fourth-quarter 2023 earnings on Feb 15, before the opening bell.In the last reported quarter, the company’s earnings of 72 cents per share beat the Zacks Consensus Estimate of 63 cents backed by higher contributions from the Oil Sands unit and lower expenses. CVE’s earnings missed the Zacks Consensus Estimate in one of the trailing four quarters and beat the same thrice, delivering an average negative earnings surprise of 3.3%. This is depicted in the graph below.E ...

CALGARY, Alberta, Feb. 09, 2024 (GLOBE NEWSWIRE) -- Cenovus Energy Inc. (TSX:CVE) (NYSE:CVE) will release its fourth-quarter and full-year 2023 results on Thursday, February 15. The news release will provide consolidated fourth-quarter and full-year operating and financial information. The company's quarterly and 2023 financial statements will be available on Cenovus's website, cenovus.com. Conference call: 9 a.m. MT (11 a.m. ET) To join the conference call without operator assistance, please register here ...

CALGARY, Alberta, Feb. 09, 2024 (GLOBE NEWSWIRE) -- Cenovus Energy Inc. (TSX: CVE) (NYSE: CVE) will release its fourth-quarter and full-year 2023 results on Thursday, February 15. The news release will provide consolidated fourth-quarter and full-year operating and financial information. The company’s quarterly and 2023 financial statements will be available on Cenovus’s website, cenovus.com. Conference call: 9 a.m. MT (11 a.m. ET) To join the conference call without operator assistance, please register her ...

Financial Data and Key Metrics Changes - The company reported approximately $3.4 billion of adjusted funds flow in the third quarter, with both upstream and downstream businesses contributing strongly to operating margin [85][17] - Net debt was approximately $6 billion at the end of the third quarter, with long-term debt decreasing to $7.2 billion after purchasing $1 billion of notes [5][17] - The company distributed over $1.2 billion directly to shareholders through base dividends, share buybacks, and partial payment of common share warrant obligations [85][70] Business Line Data and Key Metrics Changes - The upstream business production increased to nearly 800,000 BOE per day in the third quarter, with an operating margin of about $3.4 billion [17][62] - The downstream business generated over $900 million in operating margin, benefiting from favorable crack spreads [63][17] - The US manufacturing segment saw crude utilization increase from 70% in the prior quarter to 88% in the third quarter [84][17] Market Data and Key Metrics Changes - The company achieved first gas from the MAC Field in Indonesia in September, indicating strong performance in the Asia Pacific assets [68] - The Terra Nova FPSO returned to offshore Newfoundland and is expected to produce first oil in the fourth quarter [18][17] - The company noted that the widening of heavy oil differentials has provided opportunities for capturing additional margins [92][116] Company Strategy and Development Direction - The company plans to maintain capital spending in the range of $4.5 billion to $5 billion over the next few years, focusing on high-return growth projects [11][39] - Key growth projects include the Foster Creek steam expansion, Christina Lake pipeline development, and the West White Rose project, which are expected to contribute significant production increases [12][39][14] - The company aims to achieve a net debt target of $4 billion and deliver 100% of excess free funds flow to shareholders [70][55] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the operational reliability of oil sands assets and the execution of growth capital projects [3][17] - The company highlighted the importance of safety and operational performance, particularly following the challenges posed by wildfires earlier in the year [62][2] - Management acknowledged the potential for market volatility but emphasized a focus on executing the base business and progressing growth projects [50][95] Other Important Information - The company successfully restarted the Toledo refinery and achieved a safe startup of the fluid cat cracker at the Superior refinery [69][4] - The company is actively managing inventory and optimizing operations to maximize economic results amid fluctuating market conditions [74][92] - The West White Rose project is approximately 75% complete, with expectations for production growth starting in 2026 [39][18] Q&A Session Questions and Answers Question: What is the outlook for share buybacks and warrant obligations? - Management indicated that they expect to pay the remaining warrant obligation in Q4 and continue share buybacks as part of their shareholder return strategy [22][50] Question: Can you provide insights on the operational outlook for downstream performance? - Management stated that refining is a core part of the business, and they aim to improve downstream operations to match the performance of their thermal assets [41][92] Question: What are the key growth projects for 2024? - Management highlighted several growth projects, including Foster Creek and Sunrise, which are expected to contribute significantly to production growth [12][39][28] Question: How is the company managing its inventory and refining operations? - Management noted that they are actively looking at integration opportunities and optimizing operations to capture additional margins [92][74] Question: What is the company's strategy regarding the Trans Mountain pipeline? - Management plans to secure agreements for supply FOB at the dock and aims to access new markets, particularly in Asia [98][116]

8.9 BBOE Note: Market capitalization as at July 24, 2023. Values are approximate. Expected production based on July 26, 2023 guidance midpoints. Refining capacity represents net capacity to Cenovus and includes the completed acquisition of Toledo. Proved plus probable reserves evaluated by independent qualified evaluators with an effective date of December 31, 2022. See Advisory. 2023E Production (MBOE/d) cenovus | --- | --- | |--------------------------------|----------------| | Upstream Production | 730 M ...