Shares of Denbury Resources Inc. (NYSE:DNR) rose sharply on Thursday and were up 13% at 2:45 p.m. EST. Driving the move: the oil producer's solid fourth-quarter results, which continued its rally from last week's positive production report.
Denbury Resources finished 2017 on a good note, reporting $48 million, or $0.12 per share, of adjusted earnings. That was more than triple what it pulled in during the third quarter and an even sharper improvement from its year-ago loss. Furthermore, Denbury beat analysts' expectations by $0.05 per share. The oil producer benefited from a 1% rise in production versus the previous quarter, a nearly $10-per-barrel improvement in realized oil prices, and the continued impact of its cost-reduction efforts.
Cash flow was also much higher during the quarter, rocketing 89% from the third quarter to $124 million. That pushed its full-year total to $267 million, which was 22% higher than 2016's level. That cash flow more than covered the company's $241 million in capital spending, $59 million below its original guidance. That gave Denbury some extra cash to pay down debt, which when combined with some exchanges, has fallen $184 million over the past few months.
"We are entering 2018 as a much stronger company," according to CEO Chris Kendall. That said, strengthening the balance sheet remains the top priority. This oil stock will likely continue to be volatile until the company gets its finances back on solid ground.