Improved upstream production volume and higher prices for light crude oil helped Husky Energy Inc. post a big improvement in first-quarter profits on Wednesday.
Calgary-based Husky said it earned net income in the quarter ended March 31 of $626-million, or 70 cents per share, an increase from $368-million, or 43 cents per share compared with a year ago.
The 2011 results included an after-tax gain of $143-million from the sale of some of its non-core assets.
Revenue rose to $5.6-billion from $4.21-billion.
Analysts polled by Thomson Reuters, who normally excluded one-time items, were on average expecting earnings of 52 cents per share.
Husky said first-quarter cash flow and earnings growth were driven by higher upstream production volumes, higher realized light crude oil prices for the Atlantic region and Southeast Asia, and stronger throughput rates and margins within the downstream segment.
"These were partially offset by the impact on Western Canada realized crude oil pricing of higher discounts to WTI (West Texas Intermediate crude), the impact of a strong Canadian dollar, lower throughput at the Lloydminster upgrader and weak natural gas prices," Husky said in a release.
CEO Asim Ghosh said the results were "in accordance with our execution plan."
"Actions undertaken to grow near-term production have achieved the intended result during a period of strengthening prices. At the same time, our downstream refining segment posted strong performance, with higher throughput enabling us to capitalize on improving market conditions."
Mr. Ghosh said the company had also made steady progress in advancing mid- and long-term growth initiatives.
"Steps taken in the quarter have enabled Husky to achieve important milestones towards progressing the Liwan Gas Project offshore China. This project will create shareholder value by tapping into the fast-growing energy markets in Hong Kong and mainland China."
First-quarter production averaged 310,400 barrels of oil equivalent a day, up from 280,500 in the fourth quarter and 295,900 boe/day in first quarter of 2010.
Stock in Husky, which reported before markets opened, was up 43 cents at $28.92 in early trading Wednesday on the Toronto Stock Exchange.
Production volumes were driven higher by the February closing of the Western Canada asset acquisition and good performance from White Rose and North Amethyst, the company said.
Husky, controlled by Hong Kong billionaire Li Ka-Shing, produces oil and gas in Western Canada, off Canada's east coast and in Southeast Asia.
In the oilsands it has a joint-venture with BP plc to develop the Sunrise leases. Production from the first 60,000 barrel per day phase of Sunrise is expected to start up in 2014.
Husky also has interests in BP-operated refineries in the United States, and a chain of Husky-branded fuel retail outlets in Canada.
Husky had contemplated spinning off its southeast Asian properties into a new publicly traded company, but ultimately decided late last year to keep the high-growth assets in its portfolio.
Since taking the helm of the Calgary-based company last summer, Mr. Ghosh has been focused on growing Husky's near-term production. He took over from former CEO John Lau, who moved to Hong Kong to head up the Asian division.