• Devon Energy missed Wall Street expectations for fourth-quarter profit.
• The company predicted production of 643,000 to 663,000 boepd for 2023.
• Without hedges, the company reported a marginal increase in realized price.

Due to a production hit from extremely cold weather in the United States during the quarter and higher labor costs, shale oil company Devon Energy missed Wall Street expectations for fourth-quarter profit on Tuesday.

In extended trading, the company’s shares dropped 5% to $60.65.

About two-thirds of the United States experienced extreme weather and subfreezing temperatures in December as a result of Winter Storm Elliott, causing oil and gas wells to freeze in, which stops production because of ice crystals.

Devon had previously stated in January that it anticipated a 2% decrease in fourth-quarter production, with operations in North Dakota’s Williston region being most negatively impacted.

The business predicted production of 643,000 to 663,000 barrels of oil equivalent per day (boepd) for 2023. The company produced 636,000 boepd on average throughout the three months of October to December.

Devon claimed that higher personnel expenditures in the reported quarter were the primary cause of company spending rising 1% in 2022.

Additionally, it stated that it anticipates a $3.6 billion to $3.8 billion total capital investment in 2023, with greater spending in the first half as a result of the temporary addition of a fourth frac crew in the Delaware Basin. Additionally, the business increased its fixed quarterly dividend by 11%.

Without hedges, Devon reported a marginal increase in realized price for the fourth quarter, from $53.12 to $53.66.

According to Refinitiv data, the Oklahoma City-based company reported adjusted earnings of $1.66 per share for the quarter that ended December 31 as opposed to the average analyst forecast of $1.75 per share.

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