Suncor(US:SU)2024-02-21 16:00Financial Performance - Suncor's Oil Sands operating revenues for Q4 2023 were CAD 6,987 million, an increase from CAD 6,664 million in Q4 2022[56] - Adjusted operating earnings for the Oil Sands segment decreased to CAD 1,526 million in Q4 2023 from CAD 1,719 million in Q4 2022, primarily due to lower realized crude oil prices[57] - The company's adjusted funds from operations for the year ended December 31, 2023, were CAD 10,725 million, down from CAD 13,831 million in 2022[56] - Operating revenues for the Exploration and Production segment decreased to $495 million in Q4 2023 from $1.085 billion in Q4 2022, with adjusted operating earnings dropping to $133 million from $578 million[86][90] - Refining and Marketing operating revenues decreased to $8.053 billion in Q4 2023 from $9.019 billion in Q4 2022, with adjusted operating earnings falling to $598 million from $1.529 billion[102][103] - The company incurred an adjusted operating loss of $341 million in Q4 2023, an improvement from a loss of $482 million in Q4 2022[114] - For the twelve months ended December 31, 2023, return on capital employed (ROCE) was 15.6%, down from 19.4% in 2022[132] - Net earnings for Q4 2023 reached $2.82 billion, up 83% from $1.54 billion in Q3 2023[158] - Net earnings for Q4 2023 were $2,820 million, slightly up from $2,741 million in Q4 2022, with annual net earnings at $8,295 million compared to $9,077 million in 2022[217] Production and Sales - Total Oil Sands bitumen production increased to 866.2 mbbls/d in Q4 2023, compared to 810.1 mbbls/d in Q4 2022, driven by increased working interest and strong production at Fort Hills[59] - Net SCO production was 475,700 bbls/d in Q4 2023, down from 517,500 bbls/d in Q4 2022, reflecting significant planned turnaround activities[66] - Non-upgraded bitumen sales volumes rose to 277,500 bbls/d in Q4 2023, compared to 174,500 bbls/d in Q4 2022, due to increased production volumes[71] - Total production volumes for E&P Canada decreased to 45.3 mbbls/d in Q4 2023 from 49.1 mbbls/d in Q4 2022, primarily due to natural declines[92] - Total upstream production for Q4 2023 was 808.1 mboe/d, a 17% increase from Q3 2023's 690.5 mboe/d[158] - Total E&P sales volumes were 29.2 mboe/d in Q4 2023, significantly lower than 75.1 mboe/d in Q4 2022, due to decreased production and inventory build[94] Costs and Expenses - Total Oil Sands operating expenses decreased in Q4 2023, primarily due to lower commodity costs and decreased share-based compensation expenses[75] - Oil Sands operations cash operating costs per barrel increased to $30.80 in Q4 2023 from $28.35 in Q4 2022, primarily due to a higher proportion of Fort Hills bitumen directed to upgrading and lower excess power revenues[83] - Fort Hills cash operating costs per barrel decreased to $28.10 in Q4 2023 from $37.10 in Q4 2022, attributed to higher production volumes and lower natural gas prices[83] - Syncrude cash operating costs per barrel decreased to $33.85 in Q4 2023 from $34.60 in Q4 2022, mainly due to lower natural gas prices[83] - On a LIFO basis, refining and marketing gross margin decreased to $47.05/bbl in Q4 2023 from $69.40/bbl in Q4 2022, primarily due to lower benchmark crack spreads[111] - On a FIFO basis, refining and marketing gross margin decreased to $37.45/bbl in Q4 2023 from $59.30/bbl in Q4 2022, with a loss of $431 million on the decrease in crude oil benchmarks[111] Capital Expenditures and Investments - Capital expenditures for Q4 2023 totaled $1.482 billion, up from $1.258 billion in Q4 2022, driven by increased economic investments in various projects[122] - Oil Sands Base capital expenditures were $553 million in Q4 2023, focused on planned turnaround activities and low-carbon power cogeneration investments[124] - Syncrude capital expenditures were $244 million in Q4 2023, primarily for maintenance activities and the Mildred Lake West Extension mining project[127] - E&P capital and exploration expenditures were $152 million in Q4 2023, focused on the West White Rose Project and Terra Nova Asset Life Extension Project[128] - R&M capital expenditures were $304 million in Q4 2023, primarily for maintenance and enhancing retail operations[129] - Corporate capital expenditures were $18 million in Q4 2023, directed towards digital technologies[130] Debt and Equity - Net debt as of December 31, 2023, was $13.678 billion, an increase from $12.995 billion at September 30, 2023[147] - Total debt to total debt plus shareholders' equity was 26.3% as of December 31, 2023, down from 28.4% in 2022[143] - Shareholders' equity increased to $43,279 million at the end of 2023, up from $39,367 million in 2022[175] - The company reported a decrease in current liabilities from $12,869 million in 2022 to $9,597 million in 2023, indicating improved liquidity[219] - The company repurchased 51,982 thousand common shares in 2023 at a weighted average price of $42.96 per share, totaling $2.233 billion[153] Future Outlook - The company anticipates significant planned maintenance at Syncrude in Q1 2024, impacting 2024 guidance[84] - The company plans to fund its 2024 capital spending program of $6.3 billion to $6.5 billion through various capital resources[134] - Forward-looking statements indicate expectations for improved production rates and strategic growth initiatives in the upcoming fiscal periods[205] - The company expects production at the Terra Nova asset to ramp up in early 2024, contributing to overall production levels[1] Dividends and Shareholder Returns - The company declared a dividend of $0.55 per common share for Q4 2023, an increase from $0.52 in Q3 2023[158] - Cash dividends for Q4 2023 were $0.55 per share, up from $0.52 in Q4 2022, reflecting a commitment to returning value to shareholders[217] - The company paid dividends on common shares totaling $2,749 million in 2023, compared to $2,596 million in 2022, marking an increase of 5.9%[222]