ConocoPhillips says it’s planning a 50 percent increase in its 2018 share repurchase program, another sign of strong business for the energy company.
The Houston firm announced it will increase purchases from $2 billion to $300 and expects to fully fund this year’s $3 billion goal as well as its dividend and capital expenditures with cash from operations.
The expansion to $3 billion combined with the $3 billion of shares repurchased in 2016 and 2017 fully utilizes the board of directors’ existing share repurchase authorization of $6 billion.
Consequently, the board has authorized another $9 billion in share repurchases, bringing the total program to $15 billion. The $15 billion authorization represents nearly 20 percent of the total shares outstanding as of Sept. 30, 2016.
The company also announced that it paid down $2.1 billion of balance sheet debt during the second quarter, thereby achieving its stated debt target of $15 billion significantly earlier than the original target date of year-end 2019.
“We believe the expansion and extension of our repurchase program should be viewed as a clear signal that we are committed to delivering on our strategic priorities and that we still see upside potential for our shares,” said Ryan Lance, chairman and chief executive officer. “We have now achieved our debt target well ahead of plan, so we intend to use strong cash flows from the business to increase our return of capital to shareholders, while maintaining capital discipline.”