Canadian Natural Resources (CNQ) Q2 2024 earnings summary

Executive summary

• Achieved Q2 2024 production of 1.29 million BOEs/day, up 8% year-over-year, driven by optimized maintenance and early completion of turnarounds.

• Major turnarounds, including at Horizon, were completed ahead of schedule, supporting record production and reliability.

• Significant milestones at Horizon: one billionth barrel of bitumen produced and July SCO production of 500,000 barrels/day.

• TMX pipeline commissioning/start-up improved market access, heavy oil differentials, and realized pricing for Western Canadian crude.

• Returned $1.9 billion to shareholders in Q2 2024, with $4.9 billion distributed year-to-date through dividends and share repurchases.

Financial highlights

• Adjusted funds flow reached CAD 3.6 billion and adjusted net earnings from operations were CAD 1.9 billion in Q2 2024.

• Net earnings of $1.7 billion and cash flows from operating activities of $4.1 billion in Q2 2024.

• Returned CAD 1.9 billion to shareholders (CAD 1.1 billion in dividends, CAD 800 million in share buybacks) in Q2 2024.

• Quarterly dividend increased to CAD 0.525 per share, marking 24 consecutive years of increases and a 21% CAGR.

• Net debt at CAD 9.2 billion, debt to EBITDA at 0.6x, and liquidity of CAD 6.4 billion at quarter-end.

Outlook and guidance

• Expect strong SCO production for the remainder of 2024, with only a reduced 39-day turnaround at Scotford impacting volumes.

• No planned Horizon turnaround in 2025; anticipate higher production rates at Horizon next year.

• 2024 corporate natural gas production guidance remains at 2.12–2.23 BCF/day.

• Near-term growth from Horizon reliability project and Scotford Upgrader debottlenecking; long-term growth from IPEP and PFT projects.

• 100% of free cash flow to be allocated to shareholders in 2024.