Suncor has been too centered on power transition, should get again to fundamentals: CEO

Nevertheless, Kenyon mentioned he thinks Suncor’s concentrate on oil ignores the “demand erosion” danger the corporate faces because the tempo of electrical automobile adoption picks up and patrons search out lower-cost, lower-emission barrels sooner or later.

“They’re attempting to money in, within the short-term,” he mentioned. “However I don’t see any acknowledgment of the chance of doubling down on ‘enterprise as normal.’ ”

On Tuesday’s convention name, Kruger mentioned traders can anticipate to listen to extra on Suncor’s new route within the months to come back. However he mentioned already within the second quarter, the corporate has made “materials progress” in direction of its new aim of specializing in the basics. In June, Suncor introduced it might cut back its worker head depend by 20 per cent, or 1,500 folks, by the top of the 12 months with a view to get rid of pointless or “unaffordable” work.

As of Aug. 1, 535 of those job reductions have already occurred, Kruger mentioned, leading to a value discount of about $125 million to date.

“These actions, they aren’t straightforward, and so they actually aren’t taken evenly, however they’re crucial for our competitiveness,” he mentioned.

Suncor mentioned Tuesday it earned $1.88 billion within the second quarter of 2023, down from roughly $4 billion in the identical interval final 12 months when oil costs had been greater.

The Calgary-based power large says it took a $275-million restructuring cost within the quarter associated to the beforehand introduced job lower plans.

Because of this restructuring cost, Suncor mentioned its adjusted funds from operations for the three months ended June 30, 2023, amounted to $2.7 billion or $2.03 per share, in comparison with $5.3 billion or $3.80 per share within the prior 12 months’s quarter.

The corporate suffered a high-profile cybersecurity incident in June however mentioned the breach didn’t affect its monetary outcomes for the quarter.

This report by The Canadian Press was first printed Aug. 15, 2023.

Get the information in your inbox each Friday morning by signing up for our publication.