Stock Analysis on Net
Stock Analysis on Net

Hess Corp. (NYSE:HES)

This company has been moved to the archive! The financial data has not been updated since November 2, 2023.

Common-Size Income Statement

Hess Corp., common-size consolidated income statement

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12 months ended: Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018
Sales and other operating revenues 100.00 100.00 100.00 100.00 100.00
Gains on asset sales, net 0.89 0.39 1.86 0.34 0.51
Other, net 1.28 1.08 1.07 -0.11 1.76
Revenues and non-operating income 102.17% 101.47% 102.94% 100.23% 102.26%
Marketing, including purchased oil and gas -29.39 -27.22 -20.06 -26.73 -28.01
Operating costs and expenses -12.82 -16.45 -26.10 -19.05 -17.93
Production and severance taxes -2.25 -2.30 -2.66 -2.83 -2.70
Exploration expenses, including dry holes and lease impairment -1.84 -2.17 -7.52 -3.59 -5.73
General and administrative expenses -4.69 -4.55 -7.65 -6.11 -7.48
Depreciation, depletion and amortization -15.04 -20.45 -44.44 -32.67 -29.78
Impairment and other -0.48 -1.97 -45.55 0.00 0.00
Income (loss) before interest and income taxes 35.67% 26.37% -51.04% 9.25% 10.63%
Interest expense -4.35 -6.44 -10.03 -5.85 -6.31
Loss on debt extinguishment 0.00 0.00 0.00 0.00 -0.84
Income (loss) before income taxes 31.31% 19.94% -61.07% 3.40% 3.48%
(Provision) benefit for income taxes -9.71 -8.03 0.24 -7.10 -5.30
Net income (loss) 21.61% 11.91% -60.83% -3.70% -1.82%
Net income attributable to noncontrolling interests -3.10 -4.43 -5.44 -2.59 -2.64
Net income (loss) attributable to Hess Corporation 18.51% 7.48% -66.27% -6.28% -4.46%
Preferred stock dividends 0.00 0.00 0.00 -0.06 -0.73
Net income (loss) attributable to Hess Corporation common stockholders 18.51% 7.48% -66.27% -6.34% -5.19%

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

The financial trajectory from 2018 to 2022 is characterized by a period of extreme volatility, culminating in a severe contraction in 2020 and a subsequent strong recovery. The common-size analysis reveals a significant shift from net losses to substantial profitability, driven primarily by the reduction of non-cash charges and improved operating efficiency.

Operating Expense Management
A general downward trend is observed in several core operating cost categories. Operating costs and expenses decreased from 17.93% of revenue in 2018 to 12.82% by 2022. Similarly, general and administrative expenses declined from 7.48% in 2018 to 4.69% in 2022, suggesting an improvement in operational leaness. Exploration expenses also saw a marked reduction, falling from 5.73% in 2018 to 1.84% in 2022, despite a temporary spike to 7.52% in 2020.
Asset Impairment and Depreciation
The most significant impact on the income statement occurred in 2020, where impairment and other charges reached 45.55% of revenue, coinciding with a peak in depreciation, depletion, and amortization (DD&A) at 44.44%. These combined non-cash charges were the primary drivers of the operating loss in 2020. By 2022, these figures normalized significantly, with impairment falling to 0.48% and DD&A reducing to 15.04%.
Financial Obligations and Interest
Interest expense as a percentage of revenue peaked in 2020 at 10.03%, reflecting increased financial pressure during the period of negative earnings. Following this peak, there was a steady decline to 4.35% by 2022, indicating either a reduction in debt levels or an increase in revenue that lowered the relative burden of interest payments.
Net Profitability and Bottom-Line Performance
Net income attributable to common stockholders shows a dramatic swing. The company experienced negative margins from 2018 (-5.19%) through 2020, where the loss peaked at -66.27%. A sharp reversal occurred in 2021, with a positive margin of 7.48%, which further expanded to 18.51% in 2022. This recovery correlates with the reduction in impairment charges and the increase in income before interest and taxes, which rose from -51.04% in 2020 to 35.67% in 2022.

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