Canada's Husky Energy swings to loss, says has cut 1,400 jobs

Fri Oct 30, 2015 1:03pm EDT
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By Shubhankar Chakravorty and Nia Williams

(Reuters) - Husky Energy Inc (HSE.TO: Quote), Canada's No. 3 integrated oil company, reported a third quarter loss due to after-tax impairment charges of C$3.8 billion ($2.9 billion) on Friday and forecast a gloomy long-term outlook for oil and gas prices.

The company said it had cut about 1,400 jobs, or about 17 percent of its workforce, so far this year and could make further "adjustments" if necessary.

Husky, controlled by Hong Kong billionaire Li Ka-shing, said that in addition to the impairment charges it wrote down C$167 million against legacy oil and gas assets in Western Canada.

The company is considering selling some oil and natural gas assets in Western Canada, though not heavy oil or oil sands operations, and said it will base business plans for the next two years on an oil price assumption of U.S. crude at $40 a barrel.

"The downturn has turned out to be more severe and more protracted than even our very conservative assumptions," Husky chief executive Asim Ghosh said on an earnings call.

Calgary-based Husky, which will pay a third-quarter dividend of 30 Canadian cents per share, also said it would pay the fourth-quarter dividend in shares.

RBC Capital Markets analysts said the move to pay dividends in shares was negative for the stock, which was down more than 7.8 percent to C$18.69 in midday trade.

Husky's adjusted loss of 10 Canadian cents per share also exceeded the average analyst estimate of 7 Canadian cents, according to Thomson Reuters I/B/E/S.   Continued...