NEW YORK (AP) — Chesapeake Energy swung to a second-quarter profit on a boost in in energy production and said it expects production to continue rising throughout the year.
Still, the natural gas company plans to cut four rigs by the end of the year as it continues to rein in expenses. Shares fell 17 cents, or 3.6 percent, to $4.62 in premarket trading.
The Oklahoma City, company earned $470 million, or 47 cents per share, compared with a loss a year ago. Earnings, adjusted for non-recurring gains, were 18 cents per share.
The results surpassed Wall Street expectations. The average estimate of 12 analysts surveyed by Zacks Investment Research was for earnings of 14 cents per share.
The natural gas company's revenue rose 41 percent to $2.28 billion in the period. Its adjusted revenue was $1.28 billion, also topping Street forecasts. Six analysts surveyed by Zacks expected $1.07 billion.
The revenue gains came from higher commodity prices for production and energy hedging.
Chesapeake Energy Corp. is operating 18 rigs and expects to cut that down to 14 rigs by the end of 2017. A lingering decline in energy prices has prompted Chesapeake and its peers to cut rigs and costs.
The company's shares closed at $4.62. A year ago, they were trading at $4.90.