Marathon Oil Earnings: Margins Expand, Net Income Climbs

Lower costs helped S&P 500 (NYSE:SPY) component Marathon Oil Corporation (NYSE:MRO) pull in a higher profit in the third quarter. Marathon Oil is an oil and natural gas exploration and production company with operations in North America, Africa, and Europe.

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Marathon Oil Corporation Earnings Cheat Sheet

Results: Net income for the integrated oil-US rose to $450 million (63 cents per share) vs. $405 million (57 cents per share) in the same quarter a year earlier. This marks a rise of 11.1% from the year-earlier quarter.

Revenue: Rose 9.7% to $4.02 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Marathon Oil Corporation reported adjusted net income of 64 cents per share. By that measure, the company fell short of mean estimate of 65 cents per share. It beat the average revenue estimate of $3.36 billion.

Quoting Management: “Marathon Oil’s producing assets exceeded expectations in the third quarter, driven by superior execution in our U.S. resource plays and continued strong reliability from our base assets,” said Clarence P. Cazalot Jr., Marathon Oil chairman, president and CEO.

Key Stats:

After reporting year-over-year profit decreases for four quarters in a row, the company reported a profit increase last quarter. In the second quarter, net income fell 60.5% from the year earlier, while the figure fell 58.1% in the first quarter, 22.2% in the fourth quarter of the last fiscal year and 41.8% in the third quarter of the last fiscal year.

The company fell short of estimates last quarter after being in line with expectations the quarter before with net income of 59 cents.

The comapny’s revenue has not increased in each of the last two quarters. In the second quarter, revenue increased 1.4% to $3.75 billion from the year-earlier quarter.

Looking Forward: For next quarter, analysts have a more positive outlook about the company’s expected results. The average estimate for the fourth quarter is 77 cents per share, up from 70 cents ninety days ago. In the past month, the average estimate for the fiscal year has fallen from $2.73 per share to $2.68.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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