BUSINESS

Suncor profits fall during the third quarter on lower prices, currency swings

10/29/2014 11:16 EDT | Updated 12/29/2014 05:59 EST
CALGARY - Oilsands giant Suncor Energy Inc. posted lower profits for the third quarter, but the bottom line beat the expectations of analysts.

The Calgary-based company said its net earnings were $919 million, or 63 cents per share, down from nearly $1.7 billion, or $1.13 per share, a year earlier.

Operating earnings, which strip out the effects of unusual items, were $1.3 billion, or 89 cents per share, beating the average analyst estimate of 77 cents per share, according to Thomson Reuters.

During the same 2013 quarter operating earnings were $1.4 billion, or 95 cents per share.

Revenue during the third quarter was $10.3 billion, compared to $10.4 billion a year earlier.

"Suncor delivered a solid financial quarter despite lower crude oil pricing," said Steve Williams, president and chief executive officer.

"Our focused strategy, integrated model and strong balance sheet are competitive strengths that will continue to serve us well through the current lower crude price environment."

In addition to the lower crude prices and a drop in production from its exploration and production business, Suncor said foreign exchange fluctuations affected its net earnings.

Company-wide production dropped to 519,300 barrels of oil equivalent per day from 595,000 barrels due to asset sales, maintenance work at some of its operations and lower production from Libya.

But output from its oilsands business rose to 411,700 barrels per day during the third quarter, up from 396,400.

Work is underway on the Fort Hills oilsands mining project, which Suncor will operate. Other partners include a the Canadian arm of France's Total and Vancouver miner Teck Resources Ltd.

Some construction has begun in the field and detailed engineering work is about 55 per cent complete on the $13.5-billion project. Fort Hills is expected to start up in late 2017 and reach 90 per cent of its planned capacity a year after that.

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