Marathon Oil Corp (NYSE:MRO)'s third-quarter earnings for 2023 demonstrated a robust financial performance, with a net income of $453 million and an adjusted net income of $466 million. The company experienced a 35% sequential increase in adjusted free cash flow, reaching $718 million at a 38% reinvestment rate.
The oil giant's adjusted CFO stood at $1,144 million, with its adjusted FCF totaling $718 million, including Equatorial Guinea distributions. Oil production exceeded expectations, coming in at 421,000 barrels of oil equivalent per day (bored) and 198,000 barrels of oil per day (bold).
In Q3, Marathon returned $476 million or 42% of the adjusted CFO to shareholders. Throughout 2023, the company has returned over $1.3 billion to shareholders through share repurchases surpassing $1.1 billion and dividends.
Marathon's gross debt decreased by $451 million, driven by a significant prepayment of $250 million on its Term Loan Facility. Looking ahead to 2024, the company is aiming for strong corporate returns under its Framework for Success strategy. This includes leading free cash flow generation, shareholder capital return, gross debt reduction, per-share growth across commodity prices, and maximizing value from its Equatorial Guinea integrated gas operations.
In other news, KBR Inc (NYSE: NYSE:KBR) reported its Q3 2023 results with a 9% organic revenue growth to $1.8 billion despite a net income loss of $21 million. The company's Adjusted EBITDA was up 9% year-over-year at $186 million. KBR's President and CEO Stuart Bradie attributed the performance to the dedication of the team.
To reduce financial uncertainty and reinforce its commitment to long-term shareholder value creation, the company retired its remaining convertible debt balance. As of September 2023, KBR's backlog and options were valued at $21.8 billion.
For the nine months ending in September 2023, revenues hit $5.2 billion with a net income loss of $(286) million. Diluted earnings per share were $(2.10), with Adjusted earnings per share at $2.18. KBR reaffirmed its fiscal 2023 guidance, projecting revenues between $6.9 billion and $7.1 billion, and Adjusted EBITDA between $730 million and $750 million. The company's focus on high-end services is expected to drive future growth.
InvestingPro Insights
Marathon Oil Corp has been displaying a strong financial performance, as evidenced by the InvestingPro data. The company's Market Cap stands at 16.48B USD, with a P/E Ratio of 8.51 and an adjusted P/E Ratio of 9.56 as of the last twelve months of Q3 2023. The company also shows a promising Revenue of 6494M USD during the same period.
InvestingPro Tips highlights that Marathon Oil Corp exhibits high earnings quality, with free cash flow exceeding net income. This aligns with the company's reported increase in adjusted free cash flow. The company’s management has been actively buying back shares, further indicating their confidence in the company's performance. Additionally, the company has a history of maintaining dividend payments, having done so for 53 consecutive years, and analysts predict the company will be profitable this year.
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