By Robb M. Stewart

Cenovus Energy is bumping up its dividend 10% following the Canadian energy company's strongest-ever quarterly upstream production.

The Calgary, Alberta company logged a jump in first-quarter net earnings to 1.57 billion Canadian dollars (US$1.15 billion), or C$0.83 a share, compared with C$859 million, or C$0.47, a year earlier.

Energy companies saw a boost during the quarter as oil prices spiked with the start of the U.S.-Iran conflict and markets began pricing in an increased risk of supply disruptions.

Cenovus's earnings also benefited from an expanded operating margin, boosted in the company's oil sands segment by a full quarter of operations from the recent acquisition of MEG Energy and in the downstream activities from processing feedstock at lower prices and with higher distillate pricing.

Cash from operating activities increased to C$2.18 billion from C$1.32 billion. However, revenue for the three months fell to C$12.36 billion from last year's C$13.3 billion, due mainly to lower sales volumes in the U.S.

Cenovus's board said it will pay out a quarterly base dividend of C$0.22 a share on June 30, to shareholders of record as of June 15. The company returned C$1 billion to shareholders in the first quarter, including C$356 million from its purchase of shares, C$379 million through dividends, and C$300 million through the redemption of its series 1 and series 2 preferred shares.

The company's production, which comes from a mix of oil and gas production from oil sands, convention and offshore operations, averaged 972,100 barrels of oil equivalent a day, up from 818,900 barrels a year prior and beating the 965,700 barrels a day expected by analysts. Downstream throughput fell to 458,500 barrels a day for the quarter from 665,400 barrels on average a year earlier.

Cenovus said it is targeting upstream production this year of between 945,000 and 985,000 oil-equivalent barrels daily.

Write to Robb M. Stewart at robb.stewart@wsj.com

(END) Dow Jones Newswires

May 06, 2026 06:37 ET (10:37 GMT)

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