Talisman Energy Inc., the Canadian oil and natural gas producer with operations on six continents, reported a fourth-quarter profit for the first time in four years after selling assets and cutting costs.
Net income was $376 million, or 37 cents a share, compared with a loss of $117 million, or 11 cents, a year earlier, the Calgary-based company said in a statement on Marketwire today. Talisman posted a loss from operations of 10 cents a share.
Hal Kvisle, who took over as chief executive officer in September, has announced plans to reduce spending, cut debt and exit certain regions, including Peru, to refocus the company on near-term cash flow. Talisman sold a 49 percent stake in its U.K. unit to China Petrochemical Corp. for $1.5 billion last year. Its 2013 capital budget was set at $3 billion, a 25 percent reduction from 2012.
Output fell to the equivalent of 392,000 barrels of oil a day from 442,000 barrels a year earlier. Maintenance work in the North Sea and Southeast Asia, coupled with the Sinopec joint venture, was expected to reduce fourth-quarter production, Phil Skolnick, an analyst at Canaccord Genuity in New York, said in a Feb. 11 note to clients.
Talisman will spend about $3 billion this year as it focuses on production in the Americas, Southeast Asia and the North Sea, Richard Herbert, executive vice president of exploration, said in a Jan. 24 speech. The company plans to reduce general and administrative costs, which would include some job cuts, by 20 percent this year.
The company, which had its last profitable fourth quarter in 2008, released results before the start of regular trading on North American markets. Talisman rose 1.9 percent to C$12.56 yesterday in Toronto. The shares, which have seven buy and 19 hold recommendations from analysts, have gained 12 percent this year.
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