Imperial Oil (TSE: IMO), the Canadian subsidiary of ExxonMobil (NYSE: XOM), swung from a loss to a profit in the fourth quarter, as its revenue more than doubled from a year ago.
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Revenue & Earnings
Total revenues and other income amounted to C$12.31 billion for the quarter ended December 31, up from C$6.03 billion in Q4 2020.
Net income came in at C$813 million (C$1.18 per share) in Q4 2021, compared to a loss of C$1.15 billion (-C$1.56 per share) in the same period last year when Imperial took a non-cash asset impairment charge of C$1.2 billion.
Upstream production averaged 445,000 gross oil-equivalent barrels per day in the quarter, bringing annual production to 428,000 barrels of crude oil equivalent per day, the highest annual production in more than 30 years. Downstream refinery utilization was 89%.
Imperial declared a first-quarter dividend increase of 26% to C$0.34 per share.
CEO Commentary
Imperial’s Chairman, President, and CEO Brad Corson said, “This past year demonstrated the strength of Imperial’s integrated business model and the value we have created through structural cost reductions, relentless focus on reliable operations and capital-efficient growth in our core businesses.”
“Imperial generated about C$5.5 billion in cash flow from operating activities with about C$4.5 billion in free cash flow in 2021, and the company is committed to returning cash to shareholders, as demonstrated by our record distributions this past year. Following the completion of our accelerated normal course issuer bid in January and the sizable dividend increase we announced earlier today, Imperial is actively evaluating options for further shareholder distributions,” added Corson.
Wall Street’s Take
On January 25, Morgan Stanley analyst Devin McDermott kept a Hold rating on IMO and raised the price target to C$54 (from C$51). This implies 3.8% upside potential.
Overall, consensus on the Street is that IMO is a Moderate Buy based on three Buys and eight Holds.
The average Imperial Oil price target of C$53.43 implies 2.7% upside potential from current levels.
TipRanks’ Smart Score
IMO scores an 8 out of 10 on TipRanks’ Smart Score rating system, indicating that the stock returns are likely to outperform the overall market.
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