Download Anadarko Announces Record Results for Second Quarter 2000

ANADARKO ANNOUNCES RECORD RESULTS FOR SECOND
QUARTER 2000
HOUSTON, July 28 /PRNewswire/ -- Anadarko Petroleum Corporation (NYSE: APC) today
reported record second quarter financial and operating results as a stand alone company, and pro
forma results for the combined operations of APC and Union Pacific Resources Group. In early
July, the merger involving the two companies was completed, making Anadarko Petroleum one
of the largest and financially strongest independent oil and gas companies in the world.
"Anadarko and UPR each benefited from higher commodity prices during the second quarter and
generated substantial cash flow which we'll use to accelerate operating activities and grow
production," said Robert J. Allison, Jr., Anadarko Chairman and CEO. "Anadarko, by itself, had
a great quarter with record earnings per share, cash flow and production. On a pro forma basis,
the combined companies would have generated second quarter earnings of $210 million, cash
flow of $560 million and total production of 44.8 million energy equivalent barrels (492,000 per
day). With the production added by the UPR merger in the last six months of the year,
Anadarko's 2000 annual production will easily double our 1999 production. We expect to
produce more than 200 million energy equivalent barrels in 2001."
Second Quarter Results - Anadarko
For the second quarter of 2000, Anadarko net income available to common shareholders was
$74.9 million, or $0.58 per share (basic), on revenues of $306.3 million. For the same period in
1999, net income was $8 million, or $0.06 per share (basic), on revenues of $161.5 million. Cash
flow from operations during the second quarter of 2000 totaled $180.0 million, a 156% increase
over the $70.4 million in the corresponding quarter of 1999. Anadarko attributed the improved
results in the second quarter to significantly higher commodity prices and to increased
production. Anadarko had no significant commodity price hedges in place during the period.
During the second quarter of 2000, Anadarko produced approximately 14.2 million energy
equivalent barrels, up 15% from the 12.3 million barrels produced in the same period of 1999.
The increased production is attributed primarily to Anadarko's oil production in Algeria and in its
Bossier Field natural gas play in East Texas.
Oil prices in the second quarter averaged $27.37 per barrel, compared with $14.97 per barrel in
the same quarter last year. Total oil production in the quarter averaged 46,000 barrels per day, up
9% from 42,000 barrels per day in the second quarter of 1999.
Natural gas prices at the wellhead averaged $3.20 per thousand cubic feet (Mcf) during the
quarter, up 64% from the average of $1.95 per Mcf received in the comparable quarter of 1999.
Natural gas production in the second quarter of 2000 averaged 536 million cubic feet (MMcf)
per day, an increase of 16% over the 461 MMcf per day produced in the same period last year.
The increase is due primarily to the continued strength of Anadarko's Bossier Field natural gas
play in East Texas.
The prices received during the quarter for Anadarko's NGLs averaged $20.10 per barrel,
compared with the $11.91 per barrel average received in the same quarter last year. Production
of NGLs during the quarter averaged 21,000 barrels per day, compared with 17,000 barrels per
day in the second quarter of 1999.
First Half Results - Anadarko
For the first six months of 2000, Anadarko reported net income available to common
stockholders of $114.0 million, or $0.89 per share (basic), on revenues of $553.4 million. For the
comparable period in 1999, Anadarko had a net loss of $15.1 million, or $0.12 per common
share, on revenues of $297.9 million. The loss included a first quarter 1999 non-cash charge of
$20 million ($12.8 million after taxes) related to Anadarko's Eritrean exploration program.
Excluding the foreign impairment, Anadarko had a net loss to common stockholders of $2.3
million, or $0.02 per share for the first half of 1999. Cash flow from operations in the first half
of 2000 totaled $304.9 million compared with $116.2 million for the same period last year.
Anadarko attributed the improved revenues and earnings to significantly higher commodity
prices and increased production volumes.
During the first half of 2000, Anadarko produced approximately 27.4 million energy equivalent
barrels, up 8% from the 25.3 million barrels produced in the same period of 1999.
Anadarko's oil production for the first six months of 2000 averaged 44,000 barrels per day,
compared with an average of 43,000 barrels per day in the first half of 1999. Anadarko's average
oil price received for the 2000 period was $26.88 per barrel, up 111% from the $12.74 per barrel
received in the same period last year.
In the first six months of 2000, Anadarko's natural gas production averaged 511 MMcf of gas per
day, up 8% from the average of 475 MMcf per day produced in the same period last year. The
wellhead price received for natural gas in the first half of 2000 averaged $2.84 per Mcf, a 60%
increase above the average of $1.77 per Mcf received in the same period last year.
During the first half of 2000, Anadarko's production of NGLs averaged 22,000 barrels per day,
compared with 17,000 barrels per day in the same period in 1999. Anadarko's average price
received for NGLs was $20.43 per barrel, up from $10.20 per barrel in the first six months of last
year.
Second Quarter - Pro Forma Results
For the second quarter of 2000, pro forma net income from continuing operations for the new
Anadarko totaled $210 million, or $0.87 per common share (basic), on pro forma revenues of
$842 million. Pro forma cash flow from operations was $560 million in the quarter. Pro forma
production for the new Anadarko during the second quarter totaled 44.8 million energy
equivalent barrels, with average production of 1.7 billion cubic feet (Bcf) of natural gas per day
and 211,000 barrels of crude oil, condensate and natural gas liquids (NGLs) per day.
First Half - Pro Forma Results
For the first six months of 2000, pro forma net income from continuing operations for the new
Anadarko totaled $370 million, or $1.53 per common share (basic), on pro forma revenues of
$1.6 billion. Pro forma cash flow from operations totaled $1.0 billion in the period. Pro forma
production for the new Anadarko during the first half of the year totaled 88.4 million energy
equivalent barrels, with average daily production of 1.7 Bcf of natural gas and 208,000 barrels of
crude oil, condensate and NGLs.
A conference call, during which Anadarko management will discuss second quarter results with
market analysts, will begin at 10:00 a.m. (CDST) today, July 28, and will be broadcast live on
Anadarko's corporate website at www.anadarko.com .
Anadarko Comparative Financial Highlights
Comparative financial highlights follow (amounts in millions, except per share data):
Quarter Ended June 30
2000
Net income available to common
stockholders
$74.9
Earnings per share - basic
$0.58
Revenues
$306.3
Average common shares outstanding
128.3
1999
$ 8.0
$0.06
$161.5
125.3
Six Months Ended June 30
2000
1999
Net income (loss) available to common
stockholders
Earnings (loss) per share - basic
Revenues
Average common shares outstanding
$114.0
$0.89
$553.4
128.2
$(15.1)*
$(0.12)*
$297.9
122.9
Includes a non-cash charge of $20 million before taxes ($12.8 million after taxes) related
to the company's remaining operations in Eritrea. Excluding the foreign impairment, the
net loss was $2.3 million, or $0.02 per share (basic).
Except for historical information, all other information in this presentation consists of forwardlooking statements within the meaning of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements are subject to risks and uncertainties which could cause actual
results to differ materially from those projected, anticipated or implied. The most significant of
these risks and uncertainties are described in Anadarko's SEC filings and reports and exhibits to
those reports, and include (but are not limited to) the costs and difficulties related to the
integration of acquired businesses, commodity pricing and demand, exploration and operating
risks, development risks, and the costs and other effects of governmental regulation and legal
and administrative proceedings. Anadarko undertakes no obligation to publicly update or revise
any forward-looking statements.
Anadarko Petroleum Corporation
Summary Financial Information
$ and shares in millions
Revenues
Gas sales
Oil and condensate sales
Natural gas liquids and other
Quarter Ended
June 30
2000
1999
$152.6
114.1
39.6
$ 83.8
58.1
19.6
Year to Date
June 30
2000
1999
$
254.7
215.9
82.8
$
161.7
101.6
34.6
Total
306.3
161.5
553.4
297.9
45.8
30.1
34.4
23.2
88.7
60.2
68.5
47.6
Costs and Expenses
Operating expenses
Administrative and general
Depreciation, depletion and
amortization
Other taxes
Impairments related to
international properties
Total
61.9
13.4
53.9
8.6
119.3
24.7
110.5
17.7
--151.2
--120.1
--292.9
20.0
264.3
Operating Income
Interest Expense
155.1
20.5
41.4
18.5
260.5
41.6
33.6
37.2
Income (Loss) before Income
Taxes
Income Taxes
134.6
56.9
22.9
12.2
218.9
99.4
(3.6)
6.1
$ 77.7
$ 10.7
2.8
2.7
Net Income (Loss)
Preferred Stock Dividends
Net Income (Loss) Available to
Common Stockholders
Per Common Share
Net income (loss) - basic
Net income (loss) - diluted
Dividends
Average Number of Shares
Outstanding
Capitalization
Long-term debt
Stockholders' equity
Total
Capitalization Ratios
Long-term debt
Stockholders' equity
Total Assets
119.5
$
5.5
(9.7)
5.4
$ 74.9
$
8.0
$
114.0
$
(15.1)
$ 0.58
$ 0.56
$ 0.05
$ 0.06
$ 0.06
$ 0.05
$
$
$
0.89
0.86
0.10
$
$
$
(0.12)
(0.12)
0.10
128.3
125.3
Cash Flow from Operations before
Changes in Assets and Liabilities
Net income (loss)
$ 77.7
Depreciation, depletion and
amortization
61.9
Amortization of restricted stock
0.4
Interest expense - zero coupon
debentures
3.0
Deferred U.S. income taxes
37.0
Impairments related to
international properties
--Total
$180.0
Capital Expenditures
Capital spending
Capitalized interest
Capitalized overhead
Total
$
$239.3
5.0
22.4
$266.7
$ 10.7
128.2
$
119.5
53.9
0.4
119.3
0.8
--5.4
3.8
61.5
--$ 70.4
$120.9
5.5
22.8
$149.2
$
$
$
--304.9
395.8
10.1
44.8
450.7
$1,655.8
1,666.7
$3,322.5
50%
50%
$4,568.4
122.9
$
(9.7)
110.5
0.7
--(5.3)
$
$
$
20.0
116.2
205.2
11.0
44.8
261.0
$1,305.8
1,492.8
$2,798.6
47%
53%
$3,690.6
Anadarko Petroleum Corporation
Quarter Ended
June 30
2000
1999
Volumes and Prices
Natural Gas
Volumes, billion cubic feet
Average daily volumes, million cubic
feet per day
Price per thousand cubic feet
$
48.8
536
3.20
Year to Date
June 30
2000
1999
41.9
$
461
1.95
93.1
511
2.84
$
86.0
$
475
1.77
Crude Oil and Condensate
United States
Volumes, thousand barrels
Average daily volumes, thousand
barrels per day
Price per barrel
Algeria
Volumes, thousand barrels
Average daily volumes, thousand
barrels per day
Price per barrel
Total
Volumes, thousand barrels
Average daily volumes, thousand
barrels per day
Price per barrel
1,903
2,167
3,750
4,491
21
$ 26.20
24
$ 14.65
21
$ 25.47
25
$ 12.20
2,256
1,647
4,223
3,291
25
$ 28.36
18
$ 15.38
23
$ 28.13
18
$ 13.48
4,159
3,814
7,973
7,782
46
$ 27.37
42
$ 14.97
44
$ 26.88
43
$ 12.74
Natural Gas Liquids
Volumes, thousand barrels
Average daily volumes, thousand
barrels per day
Price per barrel
1,914
1,530
3,920
3,162
21
$ 20.10
17
$ 11.91
22
$ 20.43
17
$ 10.20
Total Energy Equivalent Barrels
Volumes, million EEBs
14.2
12.3
27.4
25.3
Anadarko Petroleum Corporation
Pro Forma Condensed Combined Financial Information
Summary Financial Information
$ and shares in millions
Revenues
Gas sales
Oil and condensate sales
Natural gas liquids sales
Minerals and other
Total
Costs and Expenses
Operating expenses
Administrative and general
Depreciation, depletion and amortization
Other taxes
Amortization of goodwill
Total
Quarter Ended
June 30, 2000
Year to Date
June 30, 2000
$408.1
297.5
82.2
54.3
842.1
$754.0
587.5
171.7
98.1
1,611.3
117.0
56.8
245.3
52.7
13.0
484.8
223.5
109.2
485.0
100.3
25.9
943.9
Operating Income
Other Income
Interest Expense
Income before Income Taxes
Income Taxes
Income from Continuing Operations
Preferred Stock Dividends
Net Income from Continuing Operations
Available to Common Stockholders
Per Common Share
Income from continuing operations - basic
Income from continuing operations - diluted
Average Number of Shares Outstanding
Cash Flow from Operations before Changes
in Assets and Liabilities
Net income from continuing operations
Depreciation, depletion and amortization
Amortization of goodwill
Amortization of restricted stock
Interest expense - zero coupon debentures
Deferred income taxes
Total
Capital Expenditures
Capitalization
Long-term debt
Stockholders' equity
Total
Capitalization Ratios
Long-term debt
Stockholders' equity
Total Assets
357.3
30.6
(29.8)
358.1
145.2
$212.9
2.7
667.4
15.8
(62.0)
621.2
245.3
$375.9
5.4
$210.2
$370.5
$0.87
$0.84
242.5
$1.53
$1.49
242.4
$212.9
245.3
13.0
0.4
3.0
85.3
$559.9
$462.0
$375.9
485.0
25.9
0.8
3.8
140.8
$1,032.2
$852.6
$4,141.6
5,730.0
$9,871.6
42%
58%
$14,859.4
Anadarko Petroleum Corporation
Pro Forma Condensed Combined Volumes and Prices
Volumes and Prices
Natural Gas
United States
Volumes, billion cubic feet
Average daily volumes, million
per day
Price per thousand cubic feet
Canada
Volumes, billion cubic feet
Average daily volumes, million
per day
Price per thousand cubic feet
Other International
Volumes, billion cubic feet
Average daily volumes, million
per day
Price per thousand cubic feet
Total
Volumes, billion cubic feet
Average daily volumes, million
per day
Price per thousand cubic feet
Crude Oil and Condensate
United States
Volumes, thousand barrels
Quarter Ended
June 30, 2000
Year to Date
June 30, 2000
128.3
253.6
1,409
$2.75
1,393
$2.57
24.2
48.8
266
$2.40
268
$2.28
0.7
1.3
8
$1.06
7
$1.04
153.2
303.7
1,684
$2.69
1,669
$2.51
5,452
10,939
cubic feet
cubic feet
cubic feet
cubic feet
Average daily volumes, thousand barrels
per day
Price per barrel
Algeria
Volumes, thousand barrels
Average daily volumes, thousand barrels
per day
Price per barrel
Canada
Volumes, thousand barrels
Average daily volumes, thousand barrels
per day
Price per barrel
Other International
Volumes, thousand barrels
Average daily volumes, thousand barrels
per day
Price per barrel
Total
Volumes, thousand barrels
Average daily volumes, thousand barrels
per day
Price per barrel
Natural Gas Liquids
United States
Volumes, thousand barrels
Average daily volumes, thousand barrels
per day
Price per barrel
Canada
Volumes, thousand barrels
Average daily volumes, thousand barrels
per day
Price per barrel
Total
Volumes, thousand barrels
Average daily volumes, thousand barrels
per day
Price per barrel
Total Energy Equivalent Barrels
Volumes, million EEBs
60
$ 22.33
61
$ 22.34
2,256
4,223
25
$ 28.36
23
$ 28.13
2,748
5,405
30
$ 17.66
30
$ 18.47
4,131
7,917
45
$ 15.22
44
$ 15.55
14,588
28,484
160
$ 20.37
157
$ 20.58
4,435
8,943
49
$ 17.78
50
$ 18.46
200.2
364.0
2
$ 17.22
2
$ 17.58
4,635
9,307
51.2
$ 17.76
52
$ 18.43
44.8
88.4
CONTACT: analysts and investors, A. Paul Taylor, Jr., 281-874-3471, or David R. Larson, 281874-3265, or media, Tony Canino, 281-873-3855, all of Anadarko Petroleum Corporation/
http://investors.anadarko.com/2000-07-28-Anadarko-Announces-Record-Results-for-SecondQuarter-2000