By The Canadian Press
CALGARY - Encana Corp. (TSX: T.ECA
) had a bigger operating profit than expected in the second quarter and recovered from a massive net loss a year earlier, the natural gas producer reported Wednesday.
The Calgary-based energy company, which reports in U.S. currency, had $730 million or 99 cents per share of net earnings and $247 million in operating earnings or 34 cents per share in the second quarter.
The operating earnings, which are closely watched by analysts, were up from $198 million or 27 cents per share a year earlier. Analysts polled by Thomson Reuters were on average expecting 19 cents per share in operating earnings.
The net earnings, which include a number of non-operating items, compared with a year-earlier loss of $1.48 billion.
Encana also announced that David P. O'Brien — one of the company's founders — has stepped down as chairman of the board. He'll remain as a director of the company while Clayton Woitas takes on the role of board chairman.
O'Brien's move had been expected as part of a broader renewal at the upper echelons of Canada's largest natural gas producer, which has been hit by an extended period of low prices for its main commodity.
In June, Encana appointed Doug Suttles as its new CEO following Randy Eresman's abrupt departure earlier in the year.
"Our results over the first half of the year have us well-positioned to deliver on our guidance targets for 2013," Suttles said in Encana's earnings announcement.
"Our focus moving forward is to continue to exercise capital discipline while working to achieve ever greater efficiencies in how we run our business. We expect to see cost savings materialize throughout the rest of the year as a result of those efforts."
Capital spending for the year will be in the lower part of its 2013 guidance range of $3.0 billion to $3.2 billion. Cash flow is on track to be in the middle to higher end of its guidance of between $2.3 billion to $2.5 billion.
Encana said it will pay a dividend of 20 cents per common share on Sept. 30.
Investors are likely eager to hear more from Suttles on what changes he plans to make at the company during a conference call with analysts.
Encana's board looked at more than 100 candidates, from both inside and outside the company, before picking the former BP executive for the top job.
At BP, Suttles led the cleanup of the massive oil spill in the Gulf of Mexico, triggered by the blowout of the Macondo well in April 2010. Some 757 million litres of oil spewed into the deep waters off the Louisiana coast.