Noble Energy Earnings 2019-09-30

NBL 10Q Quarterly Report

Balance Sheet	Income Statement	Cash Flow

Comparables ($MM TTM)
Ticker	M Cap	Assets	Liab	Rev	G Profit	Net Inc	EBITDA	EV	G Margin	EV/EBITDA	ROA
CLR	14,945	15,829	9,346	4,769	0	937	3,379	20,508	0%	6.1	6%
DVN	12,038	16,649	9,655	9,709	1,950	3,890	5,705	12,479	20%	2.2	23%
MRO	11,601	21,282	9,181	5,680	0	979	3,508	15,207	0%	4.3	5%
APA	10,639	21,806	15,255	6,943	6,599	-507	3,225	18,422	95%	5.7	-2%
NBL	10,168	21,649	11,445	3,418	0	-857	1,522	16,771	0%	11.0	-4%
COG	9,862	4,564	2,219	2,395	0	566	1,227	10,840	0%	8.8	12%
ECA	6,643	21,747	11,732	7,496	0	1,160	3,413	14,308	0%	4.2	5%
TPL	5,942	464	80	445	0	303	380	5,752	0%	15.1	65%
NFX	5,879	5,676	3,805	711	0	524	1,232	8,004	0%	6.5	9%
XEC	5,639	7,596	3,652	2,339	0	600	719	7,620	0%	10.6	8%

Document

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2019

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____to_____

Commission file number: 001-07964

NOBLE ENERGY, INC.

(Exact name of registrant as specified in its charter)



Delaware			73-0785597
(State or other jurisdiction of incorporation or organization)			(I.R.S. employer identification number)
1001 Noble Energy Way
Houston,	Texas		77070
(Address of principal executive offices)			(Zip Code)
(281)		872-3100
(Registrant’s telephone number, including area code)



Securities registered pursuant to Section 12(b) of the Act:
Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value	NBL	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller

reporting company or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.



Large accelerated filer	☒	Accelerated filer ☐	Non-accelerated filer ☐	Smaller reporting company	☐	Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☒

As of September 30, 2019, there were 478,298,006 shares of the registrant’s common stock, par value $0.01 per share, outstanding.

TABLE OF CONTENTS



Part I. Financial Information	3

Item 1. Financial Statements	3

Consolidated Statements of Operations and Comprehensive Income (Loss)	3

Consolidated Balance Sheets	4

Consolidated Statements of Cash Flows	5

Consolidated Statements of Equity	6

Notes to Consolidated Financial Statements	8

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	25

Item 3. Quantitative and Qualitative Disclosures About Market Risk	39

Item 4. Controls and Procedures	40

Part II. Other Information	40

Item 1. Legal Proceedings	40

Item 1A. Risk Factors	40

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	40

Item 3. Defaults Upon Senior Securities	40

Item 4. Mine Safety Disclosures	40

Item 5. Other Information	40

Item 6. Exhibits	41

Signatures	42

Table of Contents

Part I. Financial Information

Item 1. Financial Statements

Noble Energy, Inc.

Consolidated Statements of Operations and Comprehensive Income (Loss)

(millions, except per share amounts)

(unaudited)



	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Revenues
Oil, NGL and Gas Sales	$	1,003		$	1,136		$	2,894		$	3,409
Sales of Purchased Oil and Gas	87			72			264			191
Other Revenue	29			65			106			189
Total	1,119			1,273			3,264			3,789
Costs and Expenses
Production Expense	297			273			862			886
Depreciation, Depletion and Amortization	583			485			1,619			1,418
General and Administrative	91			107			298			316
Cost of Purchased Oil and Gas	96			76			296			204
Other Operating Expense, Net	61			27			257			107
Gain on Divestitures, Net	—			(193		)	—			(859		)
Asset Impairments	—			—			—			168
Total	1,128			775			3,332			2,240
Operating (Loss) Income	(9		)	498			(68		)	1,549
Other (Income) Expense
(Gain) Loss on Commodity Derivative Instruments	(129		)	155			23			483
Interest, Net of Amount Capitalized	67			70			196			216
Other Non-Operating Expense (Income), Net	2			(34		)	7			(10		)
Total	(60		)	191			226			689
Income (Loss) Before Income Taxes	51			307			(294		)	860
Income Tax Expense (Benefit)	15			59			(49		)	44
Net Income (Loss) and Comprehensive Income (Loss) Including Noncontrolling Interests	36			248			(245		)	816
Less: Net Income and Comprehensive Income Attributable to Noncontrolling Interests	19			21			61			58
Net Income (Loss) and Comprehensive Income (Loss) Attributable to Noble Energy	$	17		$	227		$	(306	)	$	758

Net Income (Loss) Attributable to Noble Energy Common Shareholders per Share
Basic	$	0.04		$	0.47		$	(0.64	)	$	1.57
Diluted	$	0.04		$	0.47		$	(0.64	)	$	1.56
Weighted Average Number of Common Shares Outstanding
Basic	478			482			478			484
Diluted	480			484			478			486

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

Noble Energy, Inc.

Consolidated Balance Sheets

(millions)

(unaudited)



	September 30, 2019			December 31, 2018
ASSETS
Current Assets
Cash and Cash Equivalents	$	473		$	716
Accounts Receivable, Net	677			616
Other Current Assets	277			418
Total Current Assets	1,427			1,750
Property, Plant and Equipment
Oil and Gas Properties (Successful Efforts Method of Accounting)	30,445			29,002
Property, Plant and Equipment, Other	1,045			891
Total Property, Plant and Equipment, Gross	31,490			29,893
Accumulated Depreciation, Depletion and Amortization	(12,693		)	(11,474		)
Total Property, Plant and Equipment, Net	18,797			18,419
Other Noncurrent Assets	1,780			841
Total Assets	$	22,004		$	21,010
LIABILITIES, MEZZANINE EQUITY AND SHAREHOLDERS' EQUITY
Current Liabilities
Accounts Payable – Trade	$	1,395		$	1,207
Other Current Liabilities	1,190			519
Total Current Liabilities	2,585			1,726
Long-Term Debt	6,941			6,574
Deferred Income Taxes	954			1,061
Other Noncurrent Liabilities	1,338			1,165
Total Liabilities	11,818			10,526
Commitments and Contingencies
Mezzanine Equity
Redeemable Noncontrolling Interest, Net	103			—
Shareholders’ Equity
Preferred Stock – Par Value $1.00 per share; 4 Million Shares Authorized; None Issued	—			—
Common Stock – Par Value $0.01 per share; 1 Billion Shares Authorized; 522 Million and 520 Million Shares Issued, respectively	5			5
Additional Paid in Capital	8,258			8,203
Accumulated Other Comprehensive Loss	(30		)	(32		)
Treasury Stock, at Cost; 39 Million Shares	(735		)	(730		)
Retained Earnings	1,506			1,980
Noble Energy Share of Equity	9,004			9,426
Noncontrolling Interests	1,079			1,058
Total Shareholders' Equity	10,083			10,484
Total Liabilities, Mezzanine Equity and Shareholders' Equity	$	22,004		$	21,010

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

Noble Energy, Inc.

Consolidated Statements of Cash Flows

(millions)

(unaudited)



	Nine Months Ended September 30,
	2019			2018
Cash Flows From Operating Activities
Net (Loss) Income Including Noncontrolling Interests	$	(245	)	$	816
Adjustments to Reconcile Net (Loss) Income to Net Cash Provided by Operating Activities
Depreciation, Depletion and Amortization	1,619			1,418
Deferred Income Tax Benefit	(110		)	(150		)
Loss on Commodity Derivative Instruments	23			483
Net Cash Received (Paid) in Settlement of Commodity Derivative Instruments	28			(160		)
Other Adjustments for Noncash Items Included in Income	115			45
Gain on Divestitures, Net	—			(859		)
Asset Impairments	—			168
Firm Transportation Exit Cost	92			—
Changes in Operating Assets and Liabilities
(Increase) Decrease in Accounts Receivable	(13		)	114
Increase (Decrease) in Accounts Payable	142			(91		)
Other Current Assets and Liabilities, Net	(76		)	73
Other Operating Assets and Liabilities, Net	(46		)	(81		)
Net Cash Provided by Operating Activities	1,529			1,776
Cash Flows From Investing Activities
Additions to Property, Plant and Equipment	(1,998		)	(2,589		)
Acquisitions, Net of Cash Received	—			(653		)
Additions to Equity Method Investments	(686		)	—
Proceeds from Divestitures, Net	131			1,740
Other	25			—
Net Cash Used in Investing Activities	(2,528		)	(1,502		)
Cash Flows From Financing Activities
Proceeds from Revolving Credit Facility	50			1,450
Repayment of Revolving Credit Facility	(50		)	(1,680		)
Proceeds from Noble Midstream Services Revolving Credit Facility	655			690
Repayment of Noble Midstream Services Revolving Credit Facility	(665		)	(725		)
Proceeds from Noble Midstream Services Term Loan Credit Facilities	400			500
Proceeds from Commercial Paper Borrowings, Net	511			—
Dividends Paid, Common Stock	(168		)	(156		)
Purchase and Retirement of Common Stock	—			(223		)
Contributions from Noncontrolling Interest Owners	27			348
Proceeds from Issuance of Mezzanine Equity, Net of Offering Costs	97			—
Repayment of Senior Notes	(9		)	(384		)
Other	(95		)	(86		)
Net Cash Provided by (Used in) Financing Activities	753			(266		)
(Decrease) Increase in Cash, Cash Equivalents, and Restricted Cash	(246		)	8
Cash, Cash Equivalents, and Restricted Cash at Beginning of Period	719			713
Cash, Cash Equivalents, and Restricted Cash at End of Period	$	473		$	721

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

Noble Energy, Inc.

Consolidated Statements of Shareholders' Equity

(millions)

(unaudited)



	Attributable to Noble Energy
	Common Stock		Additional Paid in Capital			Accumulated Other Comprehensive Loss			Treasury Stock at Cost			Retained Earnings			Non-controlling Interests			Total Equity
December 31, 2018	$	5	$	8,203		$	(32	)	$	(730	)	$	1,980		$	1,058		$	10,484
Net (Loss) Income	—		—			—			—			(313		)	24			(289		)
Stock-based Compensation	—		14			—			—			—			—			14
Dividends (11 cents per share)	—		—			—			—			(53		)	—			(53		)
Distributions to Noncontrolling Interest Owners	—		—			—			—			—			(17		)	(17		)
Contributions from Noncontrolling Interest Owners	—		—			—			—			—			10			10
Other	—		2			—			(5		)	—			(3		)	(6		)
March 31, 2019	$	5	$	8,219		$	(32	)	$	(735	)	$	1,614		$	1,072		$	10,143
Net (Loss) Income	—		—			—			—			(10		)	18			8
Stock-based Compensation	—		21			—			—			—			—			21
Dividends (12 cents per share)	—		—			—			—			(58		)	—			(58		)
Distributions to Noncontrolling Interest Owners	—		—			—			—			—			(19		)	(19		)
Contributions from Noncontrolling Interest Owners	—		—			—			—			—			11			11
Other	—		4			1			—			—			(7		)	(2		)
June 30, 2019	5		8,244			(31		)	(735		)	1,546			1,075			10,104
Net Income	—		—			—			—			17			19			36
Stock-based Compensation	—		16			—			—			—			—			16
Dividends (12 cents per share)	—		—			—			—			(57		)	—			(57		)
Distributions to Noncontrolling Interest Owners	—		—			—			—			—			(19		)	(19		)
Contributions from Noncontrolling Interest Owners	—		—			—			—			—			6			6
Other	—		(2		)	1			—			—			(2		)	(3		)
September 30, 2019	$	5	$	8,258		$	(30	)	$	(735	)	$	1,506		$	1,079		$	10,083

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

Noble Energy, Inc.

Consolidated Statements of Shareholders' Equity

(millions)

(unaudited)



	Attributable to Noble Energy
	Common Stock		Additional Paid in Capital			Accumulated Other Comprehensive Loss			Treasury Stock at Cost			Retained Earnings			Non-controlling Interests			Total Equity
December 31, 2017	$	5	$	8,438		$	(30	)	$	(725	)	$	2,248		$	683		$	10,619
Net Income	—		—			—			—			554			20			574
Stock-based Compensation	—		17			—			—			—			—			17
Dividends (10 cents per share)	—		—			—			—			(48		)	—			(48		)
Purchase and Retirement of Common Stock	—		(67		)	—			—			—			—			(67		)
Clayton Williams Energy Acquisition	—		(25		)	—			—			—			—			(25		)
Distributions to Noncontrolling Interest Owners	—		—			—			—			—			(11		)	(11		)
Contributions from Noncontrolling Interest Owners	—		—			—			—			—			331			331
Other	—		—			1			(6		)	—			2			(3		)
March 31, 2018	$	5	$	8,363		$	(29	)	$	(731	)	$	2,754		$	1,025		$	11,387
Net (Loss) Income	—		—			—			—			(23		)	17			(6		)
Stock-based Compensation	—		29			—			—

Closing Price ($)	Shares Out (MM)	Market Cap ($MM)
$0.00	478	$10,168

10-Q	2019-11-07	Quarter: 2019-09-30
10-Q	2019-08-02	Quarter: 2019-06-30
10-Q	2019-05-03	Quarter: 2019-03-31
10-K	2019-02-19	Annual: 2018-12-31
10-Q	2018-11-01	Quarter: 2018-09-30
10-Q	2018-08-03	Quarter: 2018-06-30
10-Q	2018-05-01	Quarter: 2018-03-31
10-K	2018-02-20	Annual: 2017-12-31
10-Q	2017-10-31	Quarter: 2017-09-30
10-Q	2017-08-03	Quarter: 2017-06-30
10-Q	2017-05-02	Quarter: 2017-03-31
10-K	2017-02-14	Annual: 2016-12-31
10-Q	2016-11-02	Quarter: 2016-09-30
10-Q	2016-08-03	Quarter: 2016-06-30
10-Q	2016-05-04	Quarter: 2016-03-31
10-K	2016-02-17	Annual: 2015-12-31
10-Q	2015-11-02	Quarter: 2015-09-30
10-Q	2015-08-03	Quarter: 2015-06-30
10-Q	2015-05-05	Quarter: 2015-03-31
10-K	2015-02-19	Annual: 2014-12-31
10-Q	2014-10-28	Quarter: 2014-09-30
10-Q	2014-07-24	Quarter: 2014-06-30
10-Q	2014-04-24	Quarter: 2014-03-31
10-K	2014-02-06	Annual: 2013-12-31
10-Q	2013-10-24	Quarter: 2013-09-30
10-Q	2013-07-25	Quarter: 2013-06-30
10-Q	2013-04-25	Quarter: 2013-03-31
10-K	2013-02-07	Annual: 2012-12-31
10-Q	2012-10-25	Quarter: 2012-09-30
10-Q	2012-07-26	Quarter: 2012-06-30
10-Q	2012-04-26	Quarter: 2012-03-31
10-K	2012-02-09	Annual: 2011-12-31
10-Q	2011-10-20	Quarter: 2011-09-30
10-Q	2011-07-28	Quarter: 2011-06-30
10-Q	2011-04-28	Quarter: 2011-03-31
10-K	2011-02-10	Annual: 2010-12-31
10-Q	2010-07-29	Quarter: 2010-06-30
10-Q	2010-04-29	Quarter: 2010-03-31
10-K	2010-02-18	Annual: 2009-12-31

8-K	2019-12-12	Regulation FD, Exhibits
8-K	2019-12-11	Officers, Regulation FD, Exhibits
8-K	2019-11-07	Earnings, Regulation FD, Exhibits
8-K	2019-10-01	Enter Agreement, Other Events, Exhibits
8-K	2019-09-24	Regulation FD, Exhibits
8-K	2019-09-24	Enter Agreement, Exhibits
8-K	2019-08-02	Earnings, Regulation FD, Exhibits
8-K	2019-05-03	Earnings, Regulation FD, Exhibits
8-K	2019-04-25	Regulation FD
8-K	2019-04-23	Shareholder Vote
8-K	2019-02-19	Earnings, Regulation FD, Exhibits
8-K	2018-11-09	Officers
8-K	2018-11-01	Earnings, Regulation FD, Exhibits
8-K	2018-10-24	Officers, Regulation FD, Exhibits
8-K	2018-10-18	Officers
8-K	2018-09-17	Regulation FD
8-K	2018-08-03	Earnings, Regulation FD, Exhibits
8-K	2018-05-31	Officers, Exhibits
8-K	2018-05-01	Earnings, Regulation FD, Exhibits
8-K	2018-04-24	Shareholder Vote
8-K	2018-03-09	Enter Agreement, Exhibits
8-K	2018-02-15	Earnings, Regulation FD, Other Events, Exhibits
8-K	2018-02-05	Officers
8-K	2018-01-30	Amend Bylaw, Exhibits
8-K	2018-01-29	Officers, Exhibits

EX-31.1	nbl-20190930x10qxex311.htm
EX-31.2	nbl-20190930x10qxex312.htm
EX-32.1	nbl-20190930x10qxex321.htm
EX-32.2	nbl-20190930x10qxex322.htm