BAKU, Azerbaijan, March 3
By Leman Zeynalova - Trend:
US Chevron continues to monitor the situation with coronavirus very closely, utilizing the guidance of international and local health authorities, the company told Trend.
“Our primary concern is the health and safety of our employees and we are taking precautionary measures to reduce their risk of exposure. We are regularly updating our workforce as we receive more information,” said the company.
The company said in its annual Security Analyst Meeting that it intends to increase shareholder returns without relying on rising oil prices.
“We believe our advantaged portfolio and capital efficiency enable us to grow cash flows and increase returns without relying on rising oil prices. Through continued execution of our strategy, Chevron has the potential to distribute $75 - $80 billion in cash to shareholders over the next five years,” said Michael Wirth, Chevron’s chairman and CEO.
Higher returns are primarily driven by the company’s new $2 billion target for cost and margin improvements as well as short cycle, capital efficient investments.
The company also expects 9 percent compound annual growth in adjusted operating cash flow per share through 2024 while holding annual capital spending in a narrow range of $19 to $22 billion. The combination is expected to result in the doubling of adjusted free cash flow per share by 2024.
“We remain focused on a returns-driven approach to capital allocation, investing in lower-risk projects that should drive solid earnings and cash flow growth. As a result, we expect return on capital to exceed 10 percent by 2024 at flat $60 Brent nominal prices, an improvement of over 300 basis points,” said Pierre Breber, Chevron’s chief financial officer. “This performance is supported by an unmatched balance sheet and the lowest dividend breakeven among our peers.”
Chevron remains committed to delivering on its financial priorities and returning more cash to its shareholders, as demonstrated by an 8 percent dividend increase in 2020 and $5 billion of expected annual share repurchases. Combined, the company has a total shareholder yield greater than 7 percent.
“Execution of our strategy is positioning Chevron to return more cash to shareholders, today and into the future,” Wirth said. “Even with price volatility, we have the capability to deliver leading dividend growth and sustain our buyback program well into the future.”
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