LOS ANGELES--(BUSINESS WIRE)--Occidental Petroleum Corporation (NYSE:OXY) announced that its net
income for the first quarter of 2009 was $368 million ($0.45 per diluted
share). Results for the quarter were impacted by certain non-core
charges. Core results for the first quarter of 2009 were $407 million
($0.50 per diluted share).
In announcing the results, Dr. Ray R. Irani, Chairman and Chief
Executive Officer, said, "In the first quarter, Occidental achieved a
nearly eight percent growth in year-over-year oil and gas production. In
addition, we have made significant progress in our continuing cost
reduction efforts and we will continue to invest in the long-term growth
of the Company. I am pleased with our effectiveness in adjusting to the
ongoing volatile market conditions."
Oil and Gas
Oil and gas segment earnings were $545 million for the first quarter of
2009. After excluding rig termination costs of $8 million, the first
quarter 2009 core results were $553 million, compared with $2.9 billion
for the same period in 2008. The $2.3 billion decrease in the first
quarter 2009 results reflected lower crude oil and natural gas prices
and higher DD&A rates.
For the first quarter of 2009, daily oil and gas sales volumes averaged
654,000 barrels of oil equivalent (BOE), compared with 607,000 BOE per
day in the first quarter of 2008. Volume increases were 22,000 BOE per
day in domestic operations, largely in the Rockies and California,
15,000 BOE per day in Oman, and 10,000 BOE per day in Argentina.
Oxy's realized price for worldwide crude oil was $39.29 per barrel for
the first quarter of 2009, compared with $86.75 per barrel for the first
quarter of 2008. Domestic realized gas prices decreased from $8.15 per
thousand cubic feet (MCF) in the first quarter of 2008 to $3.54 per MCF
for the first quarter of 2009.
Oil and gas cash production costs, including taxes - other than on
income, declined from $14.75 per BOE for the total year 2008 to $12.19
per BOE for the first quarter of 2009.
Chemicals
Chemical segment earnings for the first quarter of 2009 were $169
million, compared with $179 million for the same period in 2008. The
first quarter of 2009 results reflect higher caustic soda margins,
offset by lower volumes in chlorine, caustic soda and polyvinyl chloride.
Midstream, Marketing and Other
Midstream segment earnings were $14 million for the first quarter of
2009, compared with $123 million for the first quarter of 2008. The
earnings decline for the first quarter of 2009 reflects significantly
lower NGL prices in the gas processing business and negative mark to
market adjustments in crude oil marketing.
About Oxy
Occidental Petroleum Corporation is an international oil and gas
exploration and production company with operations in the United States,
Middle East/North Africa and Latin America regions. Oxy is the fourth
largest U.S. oil and gas company, based on equity market capitalization.
Oxy's wholly owned subsidiary, OxyChem, manufactures and markets
chlor-alkali products and vinyls. Occidental is committed to
safeguarding the environment, protecting the safety and health of
employees and neighboring communities and upholding high standards of
social responsibility in all of the company's worldwide operations.
Forward-Looking Statements
Statements in this release that contain words such as "will," "expect"
or "estimate," or otherwise relate to the future, are forward-looking
and involve risks and uncertainties that could significantly affect
expected results. Factors that could cause actual results to differ
materially include, but are not limited to: global commodity price
fluctuations and supply/demand considerations for oil, gas and
chemicals; not successfully completing (or any material delay in) any
expansions, field development, capital projects, acquisitions, or
dispositions; higher-than-expected costs; political risk; exploration
risks, such as drilling of unsuccessful wells; operational interruptions
and changes in tax rates. You should not place undue reliance on these
forward-looking statements which speak only as of the date of this
release. Unless legally required, Occidental does not undertake any
obligation to update any forward-looking statements as a result of new
information, future events or otherwise. U.S. investors are urged to
consider carefully the disclosures in our Form 10-K, available through
the following toll-free telephone number, 1-888-OXYPETE (1-888-699-7383)
or on the Internet at http://www.oxy.com.
You also can obtain a copy from the SEC by calling 1-800-SEC-0330.
For further analysis of Occidental's quarterly performance, please visit
the web site: www.oxy.com
|
SUMMARY OF SEGMENT NET SALES AND EARNINGS
|
|
|
|
|
|
(In millions, except
|
|
First Quarter
|
|
per-share amounts)
|
|
2009
|
|
|
2008
|
|
|
SEGMENT NET SALES
|
|
|
|
|
|
Oil and Gas
|
|
$
|
2,137
|
|
|
$
|
4,518
|
|
|
Chemical
|
|
|
792
|
|
|
|
1,267
|
|
|
Midstream, Marketing and Other
|
|
|
228
|
|
|
|
405
|
|
|
Eliminations
|
|
|
(84
|
)
|
|
|
(170
|
)
|
|
Net sales
|
|
$
|
3,073
|
|
|
$
|
6,020
|
|
|
SEGMENT EARNINGS
|
|
|
|
|
|
Oil and Gas (a),(b)
|
|
$
|
545
|
|
|
$
|
2,888
|
|
|
Chemical
|
|
|
169
|
|
|
|
179
|
|
|
Midstream, Marketing and Other
|
|
|
14
|
|
|
|
123
|
|
|
|
|
|
728
|
|
|
|
3,190
|
|
|
Unallocated Corporate Items
|
|
|
|
|
|
Interest expense, net
|
|
|
(20
|
)
|
|
|
--
|
|
|
Income taxes
|
|
|
(241
|
)
|
|
|
(1,294
|
)
|
|
Other (c)
|
|
|
(96
|
)
|
|
|
(77
|
)
|
|
|
|
Income from Continuing Operations (a)
|
|
|
371
|
|
|
|
1,819
|
|
|
Discontinued operations, net
|
|
|
(3
|
)
|
|
|
27
|
|
|
NET INCOME (a)
|
|
$
|
368
|
|
|
$
|
1,846
|
|
|
BASIC EARNINGS PER COMMON SHARE
|
|
|
|
|
|
Income from continuing operations
|
|
$
|
0.45
|
|
|
$
|
2.21
|
|
|
Discontinued operations, net
|
|
|
--
|
|
|
|
0.03
|
|
|
|
|
$
|
0.45
|
|
|
$
|
2.24
|
|
|
DILUTED EARNINGS PER COMMON SHARE (d)
|
|
|
|
|
|
Income from continuing operations
|
|
$
|
0.45
|
|
|
$
|
2.19
|
|
|
Discontinued operations, net
|
|
|
--
|
|
|
|
0.03
|
|
|
|
|
$
|
0.45
|
|
|
$
|
2.22
|
|
|
AVERAGE BASIC COMMON SHARES OUTSTANDING (d)
|
|
|
|
|
|
BASIC
|
|
|
811.8
|
|
|
|
825.5
|
|
|
DILUTED
|
|
|
814.4
|
|
|
|
829.8
|
|
|
(a)
|
|
Net Income - Net income and income from continuing operations
represent amounts attributable to Common Stock, after deducting
non-controlling interest of $9 million and $29 million for the
first quarter 2009 and 2008, respectively. Oil and gas segment
earnings are also presented net of these non-controlling interest
amounts.
|
|
(b)
|
|
Oil and Gas - The first quarter of 2009 includes an $8 million
pretax charge for the terminations of rig contracts.
|
|
(c)
|
|
Unallocated Corporate Item - Other - The first quarter of 2009
includes a pretax charge of $32 million of severance accruals and
$15 million for railcar leases.
|
|
(d)
|
|
Earnings per Share - The 2008 earnings per share amounts reflect the
adoption on January 1, 2009 of FSP No. EITF 03-06-1 dealing with
participating securities.
|
|
SUMMARY OF CAPITAL EXPENDITURES AND DD&A EXPENSE
|
|
|
|
|
|
First Quarter
|
|
($ millions)
|
|
2009
|
|
2008
|
|
|
CAPITAL EXPENDITURES
|
|
$
|
1,071
|
|
$
|
833
|
|
|
DEPRECIATION, DEPLETION AND
|
|
|
|
|
|
AMORTIZATION OF ASSETS
|
|
$
|
786
|
|
$
|
653
|
|
|
|
|
|
|
ITEMS AFFECTING COMPARABILITY OF CORE EARNINGS BETWEEN PERIODS
|
|
|
|
Income/(Expense)
|
|
First Quarter
|
|
($ millions)
|
|
2009
|
|
2008
|
|
|
FOREIGN EXCHANGE GAINS AND
|
|
|
|
|
|
(LOSSES)*
|
|
$
|
37
|
|
$
|
(1
|
)
|
|
*Amounts shown after tax.
|
|
SUMMARY OF OPERATING STATISTICS
|
|
|
|
|
|
First Quarter
|
|
|
|
2009
|
|
2008
|
|
NET OIL, GAS AND LIQUIDS
|
|
|
|
|
|
SALES VOLUMES PER DAY
|
|
|
|
|
|
United States
|
|
|
|
|
|
Crude Oil and Liquids (MBBL)
|
|
|
|
|
|
California
|
|
97
|
|
87
|
|
Permian
|
|
169
|
|
170
|
|
Mid-Continent and Rockies
|
|
10
|
|
4
|
|
Total
|
|
276
|
|
261
|
|
Natural Gas (MMCF)
|
|
|
|
|
|
California
|
|
216
|
|
245
|
|
Permian
|
|
194
|
|
177
|
|
Mid-Continent and Rockies
|
|
210
|
|
158
|
|
Total
|
|
620
|
|
580
|
|
Latin America
|
|
|
|
|
|
Crude Oil (MBBL)
|
|
|
|
|
|
Argentina
|
|
45
|
|
37
|
|
Colombia
|
|
47
|
|
42
|
|
Total
|
|
92
|
|
79
|
|
Natural Gas (MMCF)
|
|
|
|
|
|
Argentina
|
|
33
|
|
22
|
|
Bolivia
|
|
15
|
|
21
|
|
Total
|
|
48
|
|
43
|
|
Middle East/North Africa
|
|
|
|
|
|
Crude Oil and Liquids (MBBL)
|
|
|
|
|
|
Oman
|
|
35
|
|
20
|
|
Dolphin
|
|
20
|
|
22
|
|
Qatar
|
|
47
|
|
46
|
|
Yemen
|
|
31
|
|
25
|
|
Libya
|
|
5
|
|
17
|
|
Total
|
|
138
|
|
130
|
|
Natural Gas (MMCF)
|
|
|
|
|
|
Oman
|
|
24
|
|
23
|
|
Dolphin
|
|
205
|
|
200
|
|
Total
|
|
229
|
|
223
|
|
Barrels of Oil Equivalent (MBOE)
|
|
|
|
|
|
Subtotal consolidated subsidiaries
|
|
656
|
|
611
|
|
Colombia non-controlled interest
|
|
(6)
|
|
(6)
|
|
Yemen-Occidental net interest
|
|
4
|
|
2
|
|
Total Worldwide Sales Volumes (MBOE)
|
|
654
|
|
607
|
|
SUMMARY OF OPERATING STATISTICS - PRODUCTION
|
|
|
|
|
|
First Quarter
|
|
|
|
2009
|
|
2008
|
|
NET OIL, GAS AND LIQUIDS
|
|
|
|
|
|
PRODUCTION PER DAY
|
|
|
|
|
|
United States
|
|
|
|
|
|
Crude Oil and Liquids (MBBL)
|
|
276
|
|
261
|
|
Natural Gas (MMCF)
|
|
620
|
|
580
|
|
|
|
Latin America
|
|
|
|
|
|
Crude Oil (MBBL)
|
|
|
|
|
|
Argentina
|
|
39
|
|
36
|
|
Colombia
|
|
48
|
|
42
|
|
Total
|
|
87
|
|
78
|
|
Natural Gas (MMCF)
|
|
48
|
|
43
|
|
|
|
Middle East/North Africa
|
|
|
|
|
|
Crude Oil and Liquids (MBBL)
|
|
|
|
|
|
Oman
|
|
34
|
|
20
|
|
Dolphin
|
|
21
|
|
22
|
|
Qatar
|
|
51
|
|
46
|
|
Yemen
|
|
28
|
|
25
|
|
Libya
|
|
8
|
|
22
|
|
Total
|
|
142
|
|
135
|
|
Natural Gas (MMCF)
|
|
229
|
|
223
|
|
|
|
Barrels of Oil Equivalent (MBOE)
|
|
|
|
|
|
Subtotal consolidated subsidiaries
|
|
655
|
|
615
|
|
Colombia non-controlled interest
|
|
(6)
|
|
(6)
|
|
Yemen-Occidental net interest
|
|
3
|
|
2
|
|
Total Worldwide Production - (MBOE)
|
|
652
|
|
611
|
SIGNIFICANT TRANSACTIONS AND EVENTS AFFECTING EARNINGS
Occidental's results of operations often include the effects of
significant transactions and events affecting earnings that vary widely
and unpredictably in nature, timing and amount. Therefore, management
uses a measure called "core results," which excludes those items. This
non-GAAP measure is not meant to disassociate those items from
management's performance, but rather is meant to provide useful
information to investors interested in comparing Occidental's earnings
performance between periods. Reported earnings are considered
representative of management's performance over the long term. Core
results is not considered to be an alternative to operating income in
accordance with generally accepted accounting principles.
|
SIGNIFICANT TRANSACTIONS AND EVENTS AFFECTING EARNINGS (continued)
|
|
|
|
|
|
First Quarter
|
|
($ millions, except
|
|
|
|
Diluted
|
|
|
|
Diluted
|
|
per-share amounts)
|
|
|
2009
|
|
|
EPS
|
|
|
2008
|
|
|
EPS
|
|
TOTAL REPORTED EARNINGS*
|
|
$
|
368
|
|
|
$
|
0.45
|
|
$
|
1,846
|
|
|
$
|
2.22
|
|
Oil and Gas
|
|
|
|
|
|
|
|
|
|
Segment Earnings*
|
|
$
|
545
|
|
|
|
|
$
|
2,888
|
|
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
Rig terminations
|
|
8
|
|
|
|
|
|
--
|
|
|
|
|
Segment Core Results
|
|
|
553
|
|
|
|
|
|
2,888
|
|
|
|
|
Chemicals
|
|
|
|
|
|
|
|
|
|
Segment Earnings
|
|
|
169
|
|
|
|
|
|
179
|
|
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
No significant items affecting
|
|
|
|
|
|
|
|
|
|
earnings
|
|
|
--
|
|
|
|
|
|
--
|
|
|
|
|
Segment Core Results
|
|
|
169
|
|
|
|
|
|
179
|
|
|
|
|
Midstream, marketing and other
|
|
|
|
|
|
|
|
|
|
Segment Earnings
|
|
|
14
|
|
|
|
|
|
123
|
|
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
No significant items affecting
|
|
|
|
|
|
|
|
|
|
earnings
|
|
|
--
|
|
|
|
|
|
--
|
|
|
|
|
Segment Core Results
|
|
|
14
|
|
|
|
|
|
123
|
|
|
|
|
Total Segment Core Results
|
|
|
736
|
|
|
|
|
|
3,190
|
|
|
|
|
Corporate
|
|
|
|
|
|
|
|
|
|
Corporate Results --
|
|
|
|
|
|
|
|
|
|
Non Segment**
|
|
|
(360
|
)
|
|
|
|
|
(1,344
|
)
|
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
Severance accrual
|
|
|
32
|
|
|
|
|
|
--
|
|
|
|
|
Railcar leases
|
|
|
15
|
|
|
|
|
|
--
|
|
|
|
|
Tax effect of pre-tax
|
|
|
|
|
|
|
|
|
|
adjustments
|
|
|
(19
|
)
|
|
|
|
|
--
|
|
|
|
|
Discontinued operations, net***
|
|
3
|
|
|
|
|
(27
|
)
|
|
|
|
Corporate Core Results --
|
|
|
|
|
|
|
|
|
|
Non Segment
|
|
|
(329
|
)
|
|
|
|
|
(1,371
|
)
|
|
|
|
TOTAL CORE RESULTS
|
|
$
|
407
|
|
|
$
|
0.50
|
|
$
|
1,819
|
|
|
$
|
2.19
|
|
*
|
Represents amounts attributable to common stock, after deducting
non-controlling interest of $9 million and $29 million for the first
quarter 2009 and 2008, respectively.
|
|
**
|
Interest expense, income taxes, G&A expense and other, and non-core
items.
|
|
***
|
Amounts shown after tax.
|