Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - APACHE CORP | d624151d8k.htm |
Exhibit 99.1
|
NEWS RELEASE |
FOR IMMEDIATE RELEASE
APACHE REPORTS HIGHER THIRD-QUARTER EARNINGS DRIVEN BY 35% INCREASE IN
ONSHORE NORTH AMERICA LIQUIDS PRODUCTION
• GAAP earnings of $0.75 per share/$300 million; adjusted earnings* of $2.32 per share/$932 million
• $2.0 billion of cash flow from operations; $2.7 billion before changes in working capital*
• $700 million in shares repurchased to date under stock buyback program
HOUSTON, Nov. 7, 2013 – Apache Corporation (NYSE, Nasdaq: APA) today announced third-quarter 2013 earnings of $300 million or $0.75 per diluted common share and adjusted earnings,* which exclude certain items that impact the comparability of results, of $932 million or $2.32 per share. For the same period in the prior year, Apache reported earnings of $161 million or $0.41 per diluted common share and adjusted earnings of $861 million or $2.16 per share. Net cash provided by operating activities came to approximately $2 billion, with cash from operations before changes in operating assets and liabilities* totaling $2.7 billion, up from $2.4 billion in the year-ago period.
“The strength of our financial performance this quarter is a testament to the effectiveness of our strategy to rebalance our portfolio and drive returns by achieving the right mix of predictable production growth from our North American onshore assets combined with the substantial free cash flow generation from our international operations,” said G. Steven Farris, chairman and chief executive officer at Apache. “Apache’s focused drilling program in North America is yielding significant production growth. Our Permian and Central regions are the main drivers of this higher production, adding nearly 13,000 barrels per day of oil and natural gas liquids from the second quarter. These two regions represented 35 percent of the company’s total worldwide liquids production, up from 27 percent a year ago, contributing 149,000 barrels per day during the third quarter. Going forward, our international regions will be the primary source of excess cash flow to fund our next growth cycle.
APACHE REPORTS THIRD QUARTER 2013 RESULTS
— ADD 1
“We also made significant progress rebalancing our portfolio to provide more predictable and consistent growth. During the quarter we closed on transactions in the Gulf of Mexico Shelf and Canada, and announced a significant partnership with Sinopec in Egypt, which we expect to close by the end of this year,” Farris said. “As previously announced, sale proceeds are being used to reduce our debt and buyback shares. We’ve already repurchased nearly 8 million shares of Apache common stock, and we’re on track to pay down $2 billion in debt by yearend.”
Production and operating highlights
Highlights from the third quarter and more recent drilling include:
| • | Total worldwide net daily production of oil, natural gas, and natural gas liquids (NGLs) averaged 784,000 barrels of oil equivalent (boe) per day, with liquids production comprising 54 percent of the total. |
| • | The Permian Region achieved record production of 132,000 boe per day, up 7 percent from the preceding period and up 18 percent from a year ago. In the region’s Barnhart area, six rigs were active throughout the quarter drilling 20 Middle and Upper Wolfcamp Shale laterals. Apache holds 345,000 net acres prospective for Wolfcamp Shale development with 971 identified locations. During October, the region achieved a milestone with half of its operated rigs drilling horizontal wells. |
| • | Apache’s Central Region increased production to 95,000 boe per day, up 4 percent from the preceding quarter and 31 percent from the third quarter of 2012. Liquids production increased to 49,000 barrels per day, up 94 percent from the same period in the prior year, and now comprises 52 percent of the region’s production. Drilling is concentrated in the stacked pays of the Anadarko Basin targeting formations such as the Granite Wash and Tonkawa, where Apache has identified thousands of locations on its prolific acreage position. |
| • | In its international regions, Apache commenced production from the Macedon development in Western Australia. This includes four offshore production wells, transmission lines and an onshore processing plant. Apache holds a 28.57 percent working interest in Macedon, with gross sales ramped up to 212 million cubic feet (MMcf) per day. In the North Sea, a second development well commenced production from the Tonto field, testing at an initial 24-hour rate of 8,300 barrels of oil per day. Apache holds a 100 percent working interest in Tonto. |
APACHE REPORTS THIRD QUARTER 2013 RESULTS
— ADD 2
Apache’s third-quarter 2013 operations supplement includes drilling, production and other updates for each of its regions, and can be accessed at www.apachecorp.com/financialdata.
Oil and gas prices
Apache’s mix of hydrocarbon production during the third quarter 2013 included approximately 46 percent crude oil and 9 percent natural gas liquids (NGLs). Due to the premium prices received for crude oil and NGLs, these products contributed 84 percent of the company’s revenue during the period.
Worldwide, Apache received an average price of $107.50 per barrel of oil during the third quarter, compared with $102.62 per barrel in the same period the prior year. Apache received an average price of $3.49 per thousand cubic feet (Mcf) of natural gas, compared with $3.76 per Mcf in the prior-year period.
About Apache
Apache Corporation is an oil and gas exploration and production company with operations in the United States, Canada, Egypt, the United Kingdom, Australia and Argentina. Apache posts announcements, operational updates, investor information and press releases on its website, www.apachecorp.com.
* Adjusted earnings and cash from operations before changes in operating assets and liabilities are non-GAAP measures. Please see reconciliations below. For supplemental financial and operational data and non-GAAP information, please go to http://www.apachecorp.com/financialdata.
Conference call
Apache will conduct a conference call to discuss its results and review its portfolio at 1 p.m. Central time on Thursday, Nov. 7. The call will be webcast on Apache’s website, www.apachecorp.com. A replay of the webcast will be archived on Apache’s website and available for delayed playback by telephone for one week beginning at approximately 4 p.m. Central time on Nov. 7. To access the telephone playback, dial 855-859-2056 or 404-537-3406 for international calls. The conference access code is 84102630.
-end-
APACHE REPORTS THIRD QUARTER 2013 RESULTS
— ADD 3
Forward-looking statements
This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements can be identified by words such as “anticipates,” “intends,” “plans,” “seeks,” “believes,” “estimates,” “expects” and similar references to future periods. These statements include, but are not limited to, statements about future plans, expectations, and objectives for Apache’s operations, including statements about our drilling plans and production expectations, asset sales and monetizations and share repurchases. The transaction with Sinopec is subject to customary closing conditions and may not be completed for the amount expected, in the anticipated time frame, or at all. While forward-looking statements are based on assumptions and analyses made by us that we believe to be reasonable under the circumstances, whether actual results and developments will meet our expectations and predictions depend on a number of risks and uncertainties which could cause our actual results, performance, and financial condition to differ materially from our expectations. See “Risk Factors” in our 2012 Form 10-K filed with the Securities and Exchange Commission for a discussion of risk factors that affect our business. Any forward-looking statement made by us in this news release speaks only as of the date on which it is made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future development, or otherwise, except as may be required by law.
Contacts
| Media: | (713) 296-6100 | Patrick Cassidy | ||||
| (713) 296-7276 | Bill Mintz | |||||
| (713) 296-6662 | Bob Dye | |||||
| Investor: |
(281) 302-2286 | Brady Parish | ||||
| Castlen Kennedy | ||||||
| Christopher Cortez | ||||||
| Alicia Reis | ||||||
| Website: |
www.apachecorp.com | |||||
APACHE CORPORATION
STATEMENT OF CONSOLIDATED OPERATIONS
(In millions, except per share data)
| For the Quarter | For the Nine Months |
|||||||||||||||
| Ended September 30, | Ended September 30, | |||||||||||||||
| 2013 | 2012 | 2013 | 2012 | |||||||||||||
| REVENUES AND OTHER: |
||||||||||||||||
| Oil revenues |
$ | 3,538 | $ | 3,220 | $ | 9,989 | $ | 9,824 | ||||||||
| Gas revenues |
692 | 788 | 2,196 | 2,339 | ||||||||||||
| NGL revenues |
179 | 133 | 489 | 391 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Oil and gas production revenues |
4,409 | 4,141 | 12,674 | 12,554 | ||||||||||||
| Derivative instrument gains (losses), net |
(422 | ) | — | (275 | ) | — | ||||||||||
| Other |
32 | 38 | 79 | 133 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 4,019 | 4,179 | 12,478 | 12,687 | |||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| COSTS AND EXPENSES: |
||||||||||||||||
| Depreciation, depletion and amortization |
||||||||||||||||
| Oil and gas property and equipment |
||||||||||||||||
| Recurring |
1,330 | 1,206 | 3,906 | 3,535 | ||||||||||||
| Additional |
743 | 729 | 808 | 1,898 | ||||||||||||
| Other assets |
99 | 94 | 297 | 268 | ||||||||||||
| Asset retirement obligation accretion |
66 | 60 | 196 | 172 | ||||||||||||
| Lease operating expenses |
819 | 801 | 2,419 | 2,178 | ||||||||||||
| Gathering and transportation |
83 | 86 | 237 | 235 | ||||||||||||
| Taxes other than income |
185 | 167 | 610 | 627 | ||||||||||||
| General and administrative |
127 | 124 | 376 | 384 | ||||||||||||
| Merger, acquisitions & transition |
— | 7 | — | 29 | ||||||||||||
| Financing costs, net |
51 | 40 | 155 | 125 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 3,503 | 3,314 | 9,004 | 9,451 | |||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| INCOME BEFORE INCOME TAXES |
516 | 865 | 3,474 | 3,236 | ||||||||||||
| Current income tax provision |
410 | 544 | 1,191 | 1,729 | ||||||||||||
| Deferred income tax provision (benefit) |
(200 | ) | 141 | 225 | 174 | |||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| NET INCOME |
306 | 180 | 2,058 | 1,333 | ||||||||||||
| Preferred stock dividends |
6 | 19 | 44 | 57 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| INCOME ATTRIBUTABLE TO COMMON STOCK |
$ | 300 | $ | 161 | $ | 2,014 | $ | 1,276 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| NET INCOME PER COMMON SHARE: |
||||||||||||||||
| Basic |
$ | 0.75 | $ | 0.41 | $ | 5.11 | $ | 3.29 | ||||||||
| Diluted |
$ | 0.75 | $ | 0.41 | $ | 5.06 | $ | 3.27 | ||||||||
| WEIGHTED-AVERAGE NUMBER OF COMMON SHARES OUTSTANDING: |
||||||||||||||||
| Basic |
399 | 391 | 394 | 388 | ||||||||||||
| Diluted |
401 | 393 | 407 | 390 | ||||||||||||
| DIVIDENDS DECLARED PER COMMON SHARE |
$ | 0.20 | $ | 0.17 | $ | 0.60 | $ | 0.51 | ||||||||
APACHE CORPORATION
SUMMARY OF CAPITAL COSTS INCURRED
(In millions)
| For the Quarter | For the Nine Months |
|||||||||||||||
| Ended September 30, |
Ended September 30, |
|||||||||||||||
| 2013 | 2012 | 2013 | 2012 | |||||||||||||
| CAPITAL EXPENDITURES (1): |
||||||||||||||||
| Exploration & Development Costs |
||||||||||||||||
| United States |
$ | 1,489 | $ | 1,422 | $ | 4,171 | $ | 3,608 | ||||||||
| Canada |
155 | 164 | 502 | 459 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| North America |
1,644 | 1,586 | 4,673 | 4,067 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Egypt |
263 | 299 | 813 | 809 | ||||||||||||
| Australia |
284 | 265 | 911 | 518 | ||||||||||||
| North Sea |
217 | 283 | 647 | 703 | ||||||||||||
| Argentina |
60 | 65 | 145 | 222 | ||||||||||||
| New Ventures—International |
3 | 51 | 28 | 84 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| International |
827 | 963 | 2,544 | 2,336 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Worldwide Exploration & Development Costs |
$ | 2,471 | $ | 2,549 | $ | 7,217 | $ | 6,403 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Gathering, Transmission and Processing Facilities |
||||||||||||||||
| United States |
$ | 70 | $ | 13 | $ | 120 | $ | 57 | ||||||||
| Canada |
55 | 52 | 111 | 138 | ||||||||||||
| Egypt |
23 | (22 | ) | 57 | 15 | |||||||||||
| Australia |
201 | 89 | 534 | 338 | ||||||||||||
| Argentina |
3 | 3 | 7 | 12 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total Gathering, Transmission and Processing |
$ | 352 | $ | 135 | $ | 829 | $ | 560 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Capitalized Interest |
$ | 93 | $ | 90 | $ | 276 | $ | 241 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Capital Expenditures, excluding Acquisitions |
$ | 2,916 | $ | 2,774 | $ | 8,322 | $ | 7,204 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Acquisitions |
$ | 8 | $ | 59 | $ | 318 | $ | 3,421 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (1) | Accrual basis |
APACHE CORPORATION
SUMMARY BALANCE SHEET INFORMATION
(In millions)
| September 30, | December 31, | |||||||
| 2013 | 2012 | |||||||
| Cash and Cash Equivalents |
$ | 1,251 | $ | 160 | ||||
| Other Current Assets |
4,765 | 4,802 | ||||||
| Property and Equipment, net |
51,462 | 53,280 | ||||||
| Goodwill |
1,369 | 1,289 | ||||||
| Other Assets |
1,392 | 1,206 | ||||||
|
|
|
|
|
|||||
| Total Assets |
$ | 60,239 | $ | 60,737 | ||||
|
|
|
|
|
|||||
| Short-Term Debt |
$ | 57 | $ | 990 | ||||
| Other Current Liabilities |
4,466 | 4,546 | ||||||
| Long-Term Debt |
10,868 | 11,355 | ||||||
| Deferred Credits and Other Noncurrent Liabilities |
11,867 | 12,515 | ||||||
| Shareholders’ Equity |
32,981 | 31,331 | ||||||
|
|
|
|
|
|||||
| Total Liabilities and Shareholders’ Equity |
$ | 60,239 | $ | 60,737 | ||||
|
|
|
|
|
|||||
| Common shares outstanding at end of period |
404 | 392 | ||||||
APACHE CORPORATION
PRODUCTION INFORMATION
| For the Quarter | For the Nine Months | |||||||||||||||
| Ended September 30, | Ended September 30, | |||||||||||||||
| 2013 | 2012 | 2013 | 2012 | |||||||||||||
| OIL VOLUME—Barrels per day |
||||||||||||||||
| Central |
25,659 | 17,003 | 22,730 | 11,843 | ||||||||||||
| Permian |
73,910 | 60,822 | 70,229 | 58,573 | ||||||||||||
| GOM Deepwater |
7,564 | 6,982 | 7,675 | 6,342 | ||||||||||||
| GOM Shelf |
45,431 | 38,573 | 45,599 | 42,242 | ||||||||||||
| GC Onshore |
11,126 | 9,621 | 10,570 | 9,884 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| United States |
163,690 | 133,001 | 156,803 | 128,884 | ||||||||||||
| Canada |
18,573 | 15,075 | 18,112 | 15,311 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| North America |
182,263 | 148,076 | 174,915 | 144,195 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Egypt |
89,294 | 97,546 | 89,530 | 98,648 | ||||||||||||
| Australia |
18,787 | 28,191 | 20,195 | 29,690 | ||||||||||||
| North Sea |
57,861 | 57,296 | 63,291 | 63,058 | ||||||||||||
| Argentina |
9,560 | 9,885 | 9,408 | 9,701 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| International |
175,502 | 192,918 | 182,424 | 201,097 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total |
357,765 | 340,994 | 357,339 | 345,292 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| NATURAL GAS VOLUME—Mcf per day |
||||||||||||||||
| Central |
274,061 | 281,945 | 275,520 | 227,903 | ||||||||||||
| Permian |
190,192 | 180,610 | 188,803 | 179,648 | ||||||||||||
| GOM Deepwater |
11,804 | 41,267 | 22,562 | 45,333 | ||||||||||||
| GOM Shelf |
243,477 | 266,415 | 253,360 | 299,897 | ||||||||||||
| GC Onshore |
110,889 | 93,196 | 107,928 | 89,078 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| United States |
830,423 | 863,433 | 848,173 | 841,859 | ||||||||||||
| Canada |
529,402 | 604,442 | 523,163 | 617,530 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| North America |
1,359,825 | 1,467,875 | 1,371,336 | 1,459,389 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Egypt |
350,504 | 329,793 | 357,747 | 354,856 | ||||||||||||
| Australia |
212,141 | 215,317 | 212,845 | 217,053 | ||||||||||||
| North Sea |
46,971 | 54,478 | 50,108 | 62,061 | ||||||||||||
| Argentina |
185,962 | 213,745 | 186,241 | 216,399 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| International |
795,578 | 813,333 | 806,941 | 850,369 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total |
2,155,403 | 2,281,208 | 2,178,277 | 2,309,758 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| NGL VOLUME—Barrels per day |
||||||||||||||||
| Central |
23,437 | 8,305 | 22,006 | 5,271 | ||||||||||||
| Permian |
26,057 | 20,739 | 23,131 | 16,613 | ||||||||||||
| GOM Deepwater |
566 | 1,483 | 871 | 1,073 | ||||||||||||
| GOM Shelf |
5,234 | 6,663 | 6,288 | 5,345 | ||||||||||||
| GC Onshore |
2,216 | 1,886 | 2,343 | 2,083 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| United States |
57,510 | 39,076 | 54,639 | 30,385 | ||||||||||||
| Canada |
7,012 | 6,036 | 6,788 | 6,063 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| North America |
64,522 | 45,112 | 61,427 | 36,448 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| North Sea |
1,097 | 1,470 | 1,263 | 1,797 | ||||||||||||
| Argentina |
1,713 | 3,006 | 2,254 | 3,022 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| International |
2,810 | 4,476 | 3,517 | 4,819 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total |
67,332 | 49,588 | 64,944 | 41,267 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| BOE per day |
||||||||||||||||
| Central |
94,773 | 72,298 | 90,657 | 55,097 | ||||||||||||
| Permian |
131,665 | 111,663 | 124,826 | 105,127 | ||||||||||||
| GOM Deepwater |
10,098 | 15,343 | 12,306 | 14,971 | ||||||||||||
| GOM Shelf |
91,245 | 89,639 | 94,114 | 97,570 | ||||||||||||
| GC Onshore |
31,823 | 27,039 | 30,901 | 26,813 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| United States |
359,604 | 315,982 | 352,804 | 299,578 | ||||||||||||
| Canada |
113,819 | 121,851 | 112,095 | 124,296 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| North America |
473,423 | 437,833 | 464,899 | 423,874 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Egypt |
147,711 | 152,512 | 149,154 | 157,791 | ||||||||||||
| Australia |
54,144 | 64,078 | 55,669 | 65,866 | ||||||||||||
| North Sea |
66,787 | 67,845 | 72,905 | 75,198 | ||||||||||||
| Argentina |
42,266 | 48,515 | 42,702 | 48,790 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| International |
310,908 | 332,950 | 320,430 | 347,645 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total |
784,331 | 770,783 | 785,329 | 771,519 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
APACHE CORPORATION
PRICE INFORMATION
| For the Quarter | For the Nine Months | |||||||||||||||
| Ended September 30, | Ended September 30, | |||||||||||||||
| 2013 | 2012 | 2013 | 2012 | |||||||||||||
| AVERAGE OIL PRICE PER BARREL |
||||||||||||||||
| Central |
$ | 101.90 | $ | 85.54 | $ | 93.71 | $ | 88.82 | ||||||||
| Permian |
104.52 | 87.49 | 93.53 | 90.71 | ||||||||||||
| GOM Deepwater |
108.07 | 102.46 | 107.91 | 106.10 | ||||||||||||
| GOM Shelf |
110.40 | 104.97 | 109.60 | 109.67 | ||||||||||||
| GC Onshore |
110.06 | 104.02 | 109.08 | 108.76 | ||||||||||||
| United States (1) |
105.82 | 93.38 | 99.35 | 96.53 | ||||||||||||
| Canada |
97.58 | 82.92 | 89.33 | 85.96 | ||||||||||||
| North America (1) |
104.98 | 92.32 | 98.31 | 95.41 | ||||||||||||
| Egypt (1) |
112.61 | 113.72 | 107.73 | 112.02 | ||||||||||||
| Australia (1) |
116.21 | 116.79 | 109.40 | 116.39 | ||||||||||||
| North Sea (1) |
109.33 | 108.44 | 107.61 | 108.60 | ||||||||||||
| Argentina |
79.77 | 73.44 | 77.66 | 76.36 | ||||||||||||
| International (1) |
110.13 | 110.54 | 106.32 | 109.87 | ||||||||||||
| Total (1) |
107.50 | 102.62 | 102.40 | 103.83 | ||||||||||||
| AVERAGE NATURAL GAS PRICE PER MCF |
||||||||||||||||
| Central |
$ | 3.61 | $ | 3.24 | $ | 3.75 | $ | 3.04 | ||||||||
| Permian |
3.66 | 3.07 | 3.76 | 3.20 | ||||||||||||
| GOM Deepwater |
3.35 | 3.18 | 3.29 | 2.82 | ||||||||||||
| GOM Shelf |
3.71 | 2.90 | 3.82 | 2.86 | ||||||||||||
| GC Onshore |
3.67 | 2.95 | 3.83 | 2.70 | ||||||||||||
| United States (1) |
3.75 | 3.63 | 3.86 | 3.63 | ||||||||||||
| Canada (1) |
2.87 | 3.33 | 3.20 | 3.23 | ||||||||||||
| North America (1) |
3.41 | 3.51 | 3.61 | 3.46 | ||||||||||||
| Egypt |
3.01 | 4.04 | 2.98 | 3.86 | ||||||||||||
| Australia |
3.98 | 4.76 | 4.54 | 4.45 | ||||||||||||
| North Sea |
10.29 | 8.65 | 10.37 | 8.67 | ||||||||||||
| Argentina |
2.76 | 2.78 | 2.91 | 2.84 | ||||||||||||
| International |
3.64 | 4.21 | 3.84 | 4.10 | ||||||||||||
| Total (1) |
3.49 | 3.76 | 3.69 | 3.70 | ||||||||||||
| AVERAGE NGL PRICE PER BARREL |
||||||||||||||||
| Central |
$ | 25.61 | $ | 24.28 | $ | 24.51 | $ | 27.74 | ||||||||
| Permian |
29.93 | 27.95 | 27.25 | 34.31 | ||||||||||||
| GOM Deepwater |
31.68 | 30.24 | 32.50 | 33.40 | ||||||||||||
| GOM Shelf |
30.52 | 31.10 | 28.66 | 33.71 | ||||||||||||
| GC Onshore |
30.06 | 37.42 | 30.80 | 41.28 | ||||||||||||
| United States |
28.25 | 28.25 | 26.55 | 33.51 | ||||||||||||
| Canada |
28.77 | 31.01 | 28.49 | 35.02 | ||||||||||||
| North America |
28.30 | 28.62 | 26.76 | 33.76 | ||||||||||||
| North Sea |
69.77 | 65.45 | 70.51 | 73.60 | ||||||||||||
| Argentina |
22.19 | 16.25 | 25.11 | 21.15 | ||||||||||||
| International |
40.77 | 32.41 | 41.41 | 40.71 | ||||||||||||
| Total |
28.82 | 28.96 | 27.56 | 34.57 | ||||||||||||
| (1) | Prices reflect the impact of financial derivative hedging activities. |
APACHE CORPORATION
NON-GAAP FINANCIAL MEASURES
(In millions, except per share data)
Reconciliation of income attributable to common stock to adjusted earnings:
The press release discusses Apache’s adjusted earnings. Adjusted earnings exclude certain items that management believes affect the comparability of operating results and are meaningful for the following reasons:
| • | Management uses adjusted earnings to evaluate the company’s operational trends and performance relative to other oil and gas producing companies. |
| • | Management believes this presentation may be useful to investors who follow the practice of some industry analysts who adjust reported company earnings for items that may obscure underlying fundamentals and trends. |
| • | The reconciling items below are the types of items management believes are frequently excluded by analysts when evaluating the operating trends and comparability of the company’s results. |
| For the Quarter | For the Nine Months | |||||||||||||||
| Ended September 30, |
Ended September 30, |
|||||||||||||||
| 2013 | 2012 | 2013 | 2012 | |||||||||||||
| Income Attributable to Common Stock (GAAP) |
$ | 300 | $ | 161 | $ | 2,014 | $ | 1,276 | ||||||||
| Adjustments: |
||||||||||||||||
| Oil & gas property write-downs, net of tax |
478 | 539 | 520 | 1,409 | ||||||||||||
| Commodity derivative mark-to-market, net of tax |
213 | — | 88 | — | ||||||||||||
| Deferred tax adjustments |
(31 | ) | — | 15 | — | |||||||||||
| U.K. decommissioning tax rate adjustment |
— | 118 | — | 118 | ||||||||||||
| Merger, acquisitions & transition, net of tax |
— | 4 | — | 17 | ||||||||||||
| Unrealized foreign currency fluctuation impact on deferred tax expense |
(28 | ) | 39 | (98 | ) | 40 | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Adjusted Earnings (Non-GAAP) |
$ | 932 | $ | 861 | $ | 2,539 | $ | 2,860 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Net Income per Common Share—Diluted (GAAP) |
$ | 0.75 | $ | 0.41 | $ | 5.06 | $ | 3.27 | ||||||||
| Adjustments: |
||||||||||||||||
| Oil & gas property write-downs, net of tax |
1.18 | 1.33 | 1.28 | 3.49 | ||||||||||||
| Commodity derivative mark-to-market, net of tax |
0.53 | — | 0.22 | — | ||||||||||||
| Deferred tax adjustments |
(0.07 | ) | — | 0.03 | — | |||||||||||
| U.K. decommissioning tax rate adjustment |
— | 0.30 | — | 0.30 | ||||||||||||
| Merger, acquisitions & transition, net of tax |
— | 0.02 | — | 0.05 | ||||||||||||
| Unrealized foreign currency fluctuation impact on deferred tax expense |
(0.07 | ) | 0.10 | (0.24 | ) | 0.11 | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Adjusted Earnings Per Share—Diluted (Non-GAAP) |
$ | 2.32 | $ | 2.16 | $ | 6.35 | $ | 7.22 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
Reconciliation of net cash provided by operating activities to cash from operations before changes in operating assets and liabilities:
The press release discusses Apache’s cash from operations before changes in operating assets and liabilities. It is presented because management believes the information is useful for investors because it is used internally and widely accepted by those following the oil and gas industry as a financial indicator of a company’s ability to generate cash to internally fund exploration and development activities, fund dividend programs, and service debt. It is also used by research analysts to value and compare oil and gas exploration and production companies, and is frequently included in published research when providing investment recommendations. Cash from operations before changes in operating assets and liabilities, therefore, is an additional measure of liquidity, but is not a measure of financial performance under GAAP and should not be considered as an alternative to cash flows from operating, investing, or financing activities.
The following table reconciles net cash provided by operating activities to cash from operations before changes in operating assets and liabilities.
| For the Quarter | For the Nine Months | |||||||||||||||
| Ended September 30, |
Ended September 30, |
|||||||||||||||
| 2013 | 2012 | 2013 | 2012 | |||||||||||||
| Net cash provided by operating activities |
$ | 1,978 | $ | 1,623 | $ | 7,358 | $ | 6,422 | ||||||||
| Changes in operating assets and liabilities |
743 | 793 | 319 | 1,020 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Cash from operations before changes in operating assets and liabilities |
$ | 2,721 | $ | 2,416 | $ | 7,677 | $ | 7,442 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||