May 1, 2018 / 11:13 AM / a year ago

Noble Energy's sales volume forecast disappoints, shares slide

(Reuters) - Noble Energy Inc’s (NBL.N) first-quarter profit topped analysts’ estimates, but the oil and gas producer’s weak current-quarter sales volume forecast sent its shares down 2.5 percent.

Noble, which drills oil wells in the DJ Basin as well as the Permian and Eagle Ford shale plays, said it expects second-quarter sales volume at between 340 thousand barrels of oil equivalents per day (Mboe/d) and 350 Mboe/d - lower than the previous quarter and a year ago.

“The market consensus was towards the higher end of guidance for the second quarter,” KLR Group analyst Gail Nicholson said.

Shares of Noble were down at $32.97 in afternoon trade.

“Slightly lower first-quarter volumes in conjunction with the midpoint of second-quarter guide below consensus is probably putting incremental weightage on the stock,” Nicholson said.

However, Noble raised its forecast for full-year sales volumes to between 350 Mboe/d and 360 MBoe/d, from a previous range of 343 MBoe/d to 353 MBoe/d to reflect accounting changes.

In the latest first quarter, total sales volume fell 5.5 percent to 361 MBoe/d. Reflecting the company’s new accounting method, ASC 606, total sales volumes came in at 370 MBoe/d.

Net income attributable to Noble soared to $554 million, or $1.14 per share, in the quarter ended March 31 from $36 million, or 8 cents per share, a year earlier, helped by a gain of about $795 million from asset sales.

Excluding items, it earned 35 cents per share, beating the average analyst estimate of 25 cents, according to Thomson Reuters I/B/E/S. The earnings beat was driven by a 30 percent jump in U.S. onshore shale production and higher crude oil prices.

Houston-based Noble’s total revenue rose 24 percent to $1.29 billion.

West Texas Intermediate (WTI) light crude CLc1 futures averaged at $62.89 per barrel in the quarter, up 21.5 percent from a year earlier.

Shale producers, which have benefited from a surge in production over the past few years, are facing increasing calls from investors to use a windfall of cash to boost dividends and share buybacks.

Last week, Noble announced a 10 percent rise in its quarterly dividend rate.

Reporting by Taenaz Shakir in Bengaluru; Editing by Maju Samuel

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