Cenovus shares sink after loss doubles on $1.9-billion impairment charge


Cenovus Energy Inc.’s cash levels soared alongside energy prices at the end of 2021, but its quarterly loss more than doubled due to a $1.9-billion charge in its U.S. manufacturing business.

The Calgary-based oil and gas producer reported Tuesday it lost $408 million in the fourth quarter, although the company said it still sees long-term value in the U.S. manufacturing business.

Shares in Cenovus were down almost 8 per cent in morning trade.

Otherwise, its results were buoyed by rallying energy prices and its acquisition of Husky Energy Inc., which Cenovus bought in 2021 in a deal that created Canada’s third largest oil and gas producer.

Cash from operating activities jumped to $2.2 billion from $250 million in the same period last year and free funds flow soared to $1.1 billion from $91 million the year prior.

Cenovus said it produced 825,300 barrels of oil equivalent per day in the fourth quarter, up from 467,200 in 2020 thanks to the Husky assets and record oilsands production.

Much like its peers Suncor and Imperial, Cenovus used the cash influx in 2021 to raise dividends, buy back shares and pay down its debt.

Its total long-term debt was $12.4 billion at the end of 2021, down by $1.7 billion from the start of the year.


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