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Newfield Reports Fourth Quarter and Full-Year 2001 Results**

HOUSTON, Feb. 14 /PRNewswire-FirstCall/ -- Newfield Exploration Company (NYSE: NFX) today announced financial and operating results for the fourth quarter and full-year 2001. The Company will hold a conference call at 8:30 a.m. CST on February 14, 2002. To participate in the call, please visit the Company's web site at www.newfld.com .

    2001 highlights include:

    --  Production volumes increased 25% over 2000 levels. Growth was balanced
        between acquisitions and drilling success.

    --  Year-end proved reserves increased 36% over 2000 levels to 936 billion
        cubic feet equivalent (Bcfe).  About 57% of the Company's reserves are
        now located in the Gulf of Mexico.

    --  242% of 2001 production replaced with 424 Bcfe of reserve additions.

    --  Completed largest-ever acquisition, establishing a new focus area in
        the Anadarko Basin.

    --  Continued exploratory success in the Gulf of Mexico with significant
        discovery in deep shelf gas play at West Cameron 294 and traditional
        shelf drilling success at Eugene Island 251 and High Island 472.

    --  Nearly doubled onshore Gulf Coast production volumes.  Successful
        development drilling efforts followed early 2000 property acquisition
        in South Texas.

    --  Continued to appraise the CFD 12-1 Field discovery on Block 05/36 in
        China's Bohai Bay.  Discovered a separate field -- CFD 12-1 South --
        in mid-2001.

    Fourth Quarter 2001

For the fourth quarter of 2001, the Company reported a net loss of $39.1 million, or $0.89 per share (all per share amounts are on a diluted basis). These results include a non-cash impairment charge of $106.0 million ($68.1 million after tax) and a non-cash gain related to hedging transactions (FAS 133). Without the net effect of these items, net income would have been $22.8 million, or $0.50 per share. Revenues for the fourth quarter of 2001 were $156.1 million. This compares to net income in the fourth quarter of 2000 of $46.6 million, or $1.01 per share, on revenues of $163.7 million.

Operating cash flow before changes in working capital in the fourth quarter of 2001 was $111.1 million, or $2.32 per share. This compares to operating cash flow of $133.2 million, or $2.84 per share, in the same period of 2000.

Fourth Quarter 2001 Impairment

The $68 million after-tax impairment in the fourth quarter is primarily the result of lower commodity prices at year-end 2001 and is entirely related to Newfield's early 2001 acquisition in the Mid-Continent. The Company's cost pool includes purchase accounting adjustments related to this acquisition, making the book basis of these assets significantly higher than the $333 million purchase price. The impairment will have no significant impact on Newfield's capital structure.

Newfield uses the full-cost method of accounting. Under this method, the Company compares the net capitalized costs of its oil and gas properties on a country by country basis against the present value (discounted at 10%) of future net cash flows from those reserves, generally using the commodity prices on the last day of the quarter, held flat for the life of the reserves. Future net revenues are calculated assuming a continuation of prices and costs in effect at the time of the calculation. If this valuation is lower than the net capitalized costs, the Company must record a charge to earnings equal to the difference.

The Mid-Continent acquisition was completed at a time when natural gas prices were significantly higher. Mid-Continent producing properties have a reserve life of about 11 years. Upon closing, Newfield utilized hedging to lock in natural gas prices on some of the anticipated volumes associated with this transaction. The Company hedged natural gas production equal to the anticipated acquired volumes in 2001 at nearly $6 per thousand cubic feet (Mcf). In addition, gas hedges were put in place for nearly all of the acquired company's anticipated 2002 production with floor positions of $4 per Mcf or greater, and a substantial portion of 2003 anticipated volumes were hedged at $3.50 per Mcf or higher. With the concurrence of the Securities and Exchange Commission, the determination of the impairment amount took into account the value of the Company's hedge positions at year-end 2001, which was about $78 million.

Fourth Quarter Production

In the fourth quarter of 2001, Newfield voluntarily curtailed about 5 Bcfe of its production in response to lower prices. Despite curtailments, Newfield's production increased 17% over volumes in the same period of the prior year. The following tables detail production by area and average realized prices for the fourth quarters of 2001 and 2000.

                                               4Q01         4Q00      % Change
    United States
      Natural gas (Bcf)                         31.9         28.0         14%
        Natural gas (MMcf/d)                     347          304         14%
      Oil and condensate production (MMBbls)    1.49         1.03         45%
        Oil and condensate production (BOPD)  16,183       11,148         45%
    Australia
      Oil and condensate liftings (MBbls)      534.8        590.1         (9%)
        Oil and condensate liftings (BOPD)     5,813        6,414         (9%)
    Total
      Natural gas (Bcf)                         31.9         28.0         14%
      Oil and condensate liftings (MMBbls)       2.0          1.6         25%
      Total Production (Bcfe)                   44.0         37.7         17%

    Fourth Quarter Average Realized Prices*
                                               4Q01         4Q00      % Change
    United States
      Natural gas (per Mcf)                    $3.47        $4.30        (19%)
      Oil and condensate (per Bbl)            $22.54       $22.61         ---
    Australia
      Oil and condensate liftings (per Bbl)   $19.34       $32.15        (40%)
    Total
      Natural gas (per Mcf)                    $3.47        $4.30        (19%)
      Oil and condensate (per Bbl)            $21.70       $26.09        (17%)
      Total per Mcfe                           $3.51        $4.31        (19%)

* Prices shown net of transportation expense and after hedging. The Company has not entered into hedging transactions specifically relating to Australian production.

Stated on a unit of production basis, Newfield's lease operating expense in the fourth quarter of 2001 increased to $0.66 per Mcfe compared to $0.47 per Mcfe in the same period of 2000. Due primarily to lower commodity prices, production taxes in the fourth quarter of 2001 (including resource rent tax in Australia) decreased to $0.04 per Mcfe compared to $0.17 per Mcfe in the same period of 2000. DD&A expense in the fourth quarter of 2001 increased on a unit of production basis to $1.72 per Mcfe compared to $1.40 per Mcfe in the same period of 2000. The significant increase in DD&A is related primarily to higher cost reserve additions.

Full-Year 2001

Newfield posted net income of $119.0 million, or $2.56 per share, for 2001. These results include a non-cash impairment charge and a non-cash gain and a cumulative effect of change in accounting principle related to hedging transactions (FAS 133). Without the net effect of these items, net income would have been $170.9 million, or $3.62 per share. This compares to 2000 net income of $132.3 million, or $2.93 per share. Revenues for 2001 were $749.4 million compared to $526.6 million in the prior year. Operating cash flow before changes in working capital in 2001 increased 37% to $526.8 million, or $10.90 per share, compared to $383.5 million, or $8.25 per share, in 2000.

2001 Production

Production volumes reached record levels in 2001, rising 25% over 2000 levels. Nearly half of the increase in production came from drilling programs with the remainder attributable to acquisitions. Newfield produced 175 Bcfe in 2001 compared to 140 Bcfe in 2000.

                                               2001        2000       % Change
    United States
      Natural gas (Bcf)                        133.2       105.4          26%
        Natural gas (MMcf/d)                     365         288          27%
      Oil and condensate production (MMBbls)     5.5         4.1          35%
        Oil and condensate production (BOPD)  15,130      11,175          35%
    Australia
      Oil and condensate liftings (MBbls)        1.5         1.7         (12%)
        Oil and condensate liftings (BOPD)     4,043       4,573         (12%)
    Total
      Natural gas (Bcf)                        133.2       105.4          26%
      Oil and condensate liftings (MMBbls)       7.0         5.8          21%
      Total Production (Bcfe)                  175.2       140.0          25%

    2001 Average Realized Prices*
                                               2001        2000       % Change
    United States
      Natural gas (per Mcf)                    $4.32       $3.56          21%
      Oil and condensate (per Bbl)            $24.01      $23.33           3%
    Australia
      Oil and condensate liftings (per Bbl)   $23.96      $30.08         (20%)
    Total
      Natural gas (per Mcf)                    $4.32       $3.56          21%
      Oil and condensate (per Bbl)            $24.00      $25.29          (5%)
      Total per Mcfe                           $4.25       $3.72          14%

* Prices shown net of transportation expense and after hedging. The Company has not entered into hedging transactions specifically relating to Australian production.

Stated on a unit of production basis, Newfield's lease operating expense in 2001 increased to $0.59 per Mcfe compared to $0.47 in 2000. Production taxes in 2001, including resource rent tax in Australia, were $0.10 per Mcfe compared to $0.07 per Mcfe in 2000. DD&A expense in 2001 increased on a unit of production basis to $1.61 per Mcfe compared to $1.37 per Mcfe in the prior year. The increase in DD&A expense is primarily related to higher cost reserve additions in 2001.

Finding and Development Costs

Newfield's cost to find and develop reserves, stated on a per Mcfe basis, was $1.97 in 2001. This compares to finding and development costs of $1.58 per Mcfe during 2000. The Company's five-year average finding and development cost is $1.61 per Mcfe.

Internationally, the Company continued to appraise its CFD 12-1 Field on Block 05/36 in China's Bohai Bay. In 2001, two successful appraisal wells were drilled in the CFD 12-1 Field and two successful wells were drilled in a new discovery, the CFD 12-1 South Field. Newfield has not yet booked any proved reserves with respect to these discoveries or declared the fields commercial. International capital expenditures, mainly in Australia and China, totaled $21 million in 2001.

Reserve Replacement and Proved Reserves

During 2001, Newfield's worldwide reserve replacement was 242% of total production, which was 175 Bcfe. The Company's reserve replacement in 2000 was 166% of total production. 2001 marks the 12th consecutive year that Newfield has more than replaced annual production with proved reserves.

At the end of 2001, Newfield had proved reserves of 936.4 Bcfe, which included a 14 Bcfe negative revision primarily attributable to unsuccessful drilling of proved undeveloped locations and lower prices. Proved reserves at year-end 2001 increased 36% over the 687.3 Bcfe the Company had at the end of the prior year. At year-end 2001, Newfield's reserves were 77% natural gas compared to 76% natural gas at year-end 2000. Nearly 80% of the Company's U.S. reserves are natural gas and 97% of the Company's total proved reserves are located in the U.S.

Newfield's year-end 2001 present value of estimated future net revenues from its oil and gas properties was $1,170 million. This compares to $3,874 million at year-end 2000. The value for 2001 was derived using commodity prices on December 31, 2001, which were $2.65 per MMBtu (Gas Daily - Henry Hub) and $19.84 per barrel (Platt's - WTI at Cushing). Comparable prices at year-end 2000 were $9.52 per MMBtu and $26.75 per barrel.

Capital Spending

For the full-year 2001, Newfield invested $855 million, including $435 million in acquisitions, $302 million in development, $97 million in exploration and $21 million internationally. This compares to 2000 capital spending of $379 million, including $139 million for acquisitions, $129 million for development activities, $91 million for exploration and $20 million in the international arena.

For 2002, Newfield announced a capital budget of $360 million. This includes $135 million for exploration -- the largest exploratory budget in the Company's history. Development spending is estimated at $200 million and $25 million is allocated for international. The lower capital budget was built using estimated 2002 cash flow and is in response to lower oil and gas prices.

Hedging

Newfield uses hedging as a tool to manage cash flow and rates of return on acquisitions. The Company has approximately 75% of its anticipated first half 2002 natural gas production hedged at a volume-weighted average price of about $3.35 per Mcf. Newfield has also hedged approximately 54% of its third quarter and 17% of its fourth quarter 2002 anticipated natural gas production. When including all natural gas and crude oil hedge positions in place, Newfield has nearly $83 million of hedging gains when marked-to-market at today's NYMEX futures prices. For additional information on the Company's hedge positions, please go to www.newfld.com .

First Quarter 2002 Estimates

Below are estimates of certain significant operating and financial data for the first quarter of 2002. Although the Company believes the expectations reflected in this forward-looking information are reasonable, such expectations are based upon assumptions and anticipated results that are subject to numerous uncertainties. Please see the discussion regarding forward-looking information at the end of this release.

Natural gas production and pricing Newfield's natural gas production in the first quarter of 2002 is expected to be 32 - 36 Bcf (360 - 400 MMcf/d). The Company's average realized gas price on volumes from the Gulf of Mexico and onshore Gulf Coast typically tracks the Henry Hub Index. Gas from the Company's Mid-Continent properties typically sells at a discount of $0.12 - $0.15 per Mcfe to Henry Hub. Hedging gains or losses will affect price realizations.

Crude oil production and pricing Consolidated oil production in the first quarter of 2002 is expected to be 1.6 - 1.8 million barrels (18,000 - 20,000 BOPD). Australian oil production during the first quarter is expected to be 310 - 341 thousand barrels (3,450 - 3,800 BOPD). The timing of liftings in Australia will impact reported production and revenues. Newfield's average realized U.S. oil price on Gulf Coast production typically averages about $2 below the NYMEX WTI price. Oil production from the Mid- Continent typically sells for a $1.00 - $1.50 per barrel discount to WTI. Australian crude oil sales are based on the Tapis Benchmark, which has historically been comparable to WTI. Hedging gains or losses will affect price realizations.

For the full-year 2002, the Company expects to produce 180-185 Bcfe, an increase of 3-6% over 2001 production volumes. However, decisions to curtail production in response to low oil and gas prices could adversely impact the Company's growth projections.

Lease Operating Expense Newfield's LOE, including domestic production and severance taxes and resource rent tax in Australia, is expected to be $26 - $29 million in the first quarter of 2002 ($0.60 - $0.66 per Mcfe). The Company's domestic LOE, including taxes, is expected to be $0.55 - $0.59 per Mcfe in the first quarter of 2002. This estimate includes severance taxes of $0.06 - $0.08 per Mcfe. LOE varies and is subject to impact from, among other things, production volumes and commodity pricing, tax rates, service costs, the costs of goods and materials and work over activities.

General and Administrative Expense Newfield's G&A expense for the first quarter of 2002 is expected to be $11 - $13 million ($0.25 - $0.29 per Mcfe). This estimate includes accrual of performance-based pay.

Interest Expense The non-capitalized portion of the Company's interest expense for the first quarter of 2002 is expected to be $6 - $8 million ($0.14 - $0.18 per Mcfe), including a $2.3 million payment on its convertible trust preferred securities. Current borrowings under the Company's bank facilities are $129 million. The remainder of long-term debt consists of two separate issuances of senior notes that in the aggregate total $300 million. Capitalized interest for the first quarter of 2002 is expected to be about $2.0 million.

Income Taxes Including both current and deferred taxes, the Company expects its consolidated income tax rate in the first quarter of 2002 to be about 35%. About 60% of the tax provision is expected to be deferred.

Any publicly announced changes to these estimates would be made available on Newfield's electronic publication -- @NFX. This publication can be found on the Company's web page at www.newfld.com . Through the web page, shareholders can elect to receive @NFX through e-mail distribution.

Newfield Exploration is an independent crude oil and natural gas exploration and production company. The Company has a solid asset base of producing properties and exploration and development drilling opportunities and operations primarily in the Gulf of Mexico, along the U.S. Onshore Gulf Coast, in the Anadarko and Permian Basins, offshore Australia and in China's Bohai Bay. Newfield balances its drilling program with acquisitions in select areas in the U.S. and overseas.

** Certain of the statements set forth in this release regarding estimated or anticipated first quarter 2002 results, capital spending and activity levels, future commodity prices, service costs and yearly production volumes are forward looking and based upon assumptions and anticipated results that are subject to numerous uncertainties. Actual results may vary significantly from those anticipated due to many factors, including drilling results, oil and gas prices, industry conditions, the prices of goods and services, the availability of drilling rigs and other support services and the availability of capital resources, labor conditions and other factors set forth in our Annual Report on Form 10-K for the year ended December 31, 2000. In addition, the drilling of oil and gas wells and the production of hydrocarbons are subject to governmental regulations and operating risks.

     Newfield Exploration Company                  For information, contact:
     363 N. Sam Houston Parkway East, Ste. 2020    Steve Campbell
     Houston, TX 77060                             (281) 847-6081
     www.newfld.com                                info@newfld.com


     CONSOLIDATED STATEMENT OF INCOME
     (Unaudited, in 000's, except per share data)

                                   For the                   For the
                             Three Months Ended        Twelve Months Ended
                                 December 31,               December 31,
                              2001          2000         2001          2000

    Oil and gas revenues    $156,073      $163,685     $749,405      $526,642

    Operating expenses:
      Lease operating         29,103        17,852      102,922        65,372
      Transportation           1,419         1,313        5,569         5,984
      Production and other
       taxes                   1,631         6,487       17,523        10,288
      Depreciation, depletion
       and amortization       75,585        52,800      282,567       191,182
      Ceiling test
       write-down            106,011           ---      106,011           503
      General and
       administrative          7,872         8,398       41,204        29,037
      Stock compensation         724           785        2,751         3,047
        Total operating
         expenses            222,345        87,635      558,547       305,413

    Income (loss) from
     operations              (66,272)       76,050      190,858       221,229

    Other income (expense):
      Interest income          2,535           622        3,993         2,124
      Interest expense        (7,339)       (3,120)     (27,859)      (14,673)
      Capitalized interest     2,383         1,414        8,891         5,353
      Dividends on preferred
       securities of Newfield
       Financial Trust I      (2,336)       (2,336)      (9,344)       (9,344)
      Unrealized commodity
       derivative income *     9,559           ---       24,821           ---
                               4,802        (3,420)         502       (16,540)

    Income (loss) before
     income taxes            (61,470)       72,630      191,360       204,689

    Income tax provision
     (benefit)               (22,360)       26,072       67,612        69,980

    Cumulative effect of
     change in accounting
     principles                  ---           ---       (4,794)       (2,360)

    Net income (loss)       $(39,110)      $46,558     $118,954      $132,349

    Earnings (loss) per
     share:
      Basic                   $(0.89)        $1.09        $2.69         $3.13

      Diluted                 $(0.89)        $1.01        $2.56         $2.93

    Weighted average
     shares outstanding for
     basic earnings per
     share                    44,018        42,566       44,258        42,333

    Weighted average
     shares outstanding for
     diluted earnings per
     share                    44,018 **     47,450       48,894        47,228


     PRODUCTION DATA

                                   For the                    For the
                             Three Months Ended        Twelve Months Ended
                                 December 31,               December 31,
                              2001          2000         2001          2000

    Average daily production:
      Oil and condensate
       (Bbls)                 21,996        17,561       19,173        15,748
      Gas (Mcf)                346.5         304.1        364.8         288.1

    Average realized price:
      Oil and condensate
       (Bbls)                 $21.70        $26.09       $24.00        $25.29
      Gas (Mcf)                $3.47         $4.30        $4.32         $3.56

    *  Associated with adoption of SFAS 133.
    ** Absent a loss in this period, the outstanding shares would have been
       48,552.


     CONSOLIDATED BALANCE SHEET
     (Unaudited, in thousands of dollars)

                                                   December 31,   December 31,
                                                       2001           2000
    ASSETS
    Current assets:
      Cash & cash equivalents                          $26,610        $18,451
      Accounts receivable, oil and gas                  92,644        147,643
      Inventories                                        7,332          7,572
      Commodity derivatives *                           79,012            ---
      Other current assets                              25,006          5,891
        Total current assets                           230,604        179,557

    Oil and gas properties, net (full cost method)   1,408,579        832,907
    Furniture, fixtures and equipment, net               6,807          4,028
    Commodity derivatives *                              7,409            ---
    Other assets                                         9,972          6,758
                                                    $1,663,371     $1,023,250

    LIABILITIES AND STOCKHOLDERS' EQUITY
    Current liabilities                               $134,636       $141,060
    Commodity derivatives *                              4,217            ---
      Total current liabilities                        138,853        141,060

    Other liabilities                                    6,288          6,030
    Commodity derivatives *                              1,813            ---
    Long-term debt                                     428,631        133,711
    Deferred taxes - oil and gas                       197,234         79,244
    Deferred taxes - commodity derivatives *            36,824            ---
      Total long-term liabilities                      670,790        218,985

    Company-obligated, mandatorily redeemable,
     convertible preferred securities of Newfield
     Financial Trust I                                 143,750        143,750

    STOCKHOLDERS' EQUITY
      Common stock                                         449            426
      Additional paid-in capital                       364,734        286,811
      Treasury stock                                   (25,794)          (399)
      Unearned compensation                             (7,845)        (6,201)
      Accumulated other comprehensive income (loss)
        Foreign currency translation adjustment         (8,918)        (4,644)
        Commodity derivatives *                         24,936            ---
      Retained earnings                                362,416        243,462
        Total stockholders' equity                     709,978        519,455
        Total liabilities and stockholders' equity  $1,663,371     $1,023,250

    *  Associated with adoption of SFAS 133.


     CONSOLIDATED STATEMENT OF CASH FLOWS
     (Unaudited, in thousands of dollars)

                                 For the                     For the
                            Three Months Ended         Twelve Months Ended
                                December 31,                December 31,
                             2001           2000         2001          2000
    Cash flows from
     operating activities:
      Net income (loss)    $(39,110)       $46,558     $118,954      $132,349
      Depreciation,
       depletion and
       amortization          75,585         52,800      282,567       191,182
      Deferred taxes        (22,506)        33,069       36,505        54,083
      Stock compensation        724            785        2,751         3,047
      Commodity
       derivatives *         (9,559)           ---      (24,821)          ---
      Cumulative effect of
       change in accounting
       principles               ---            ---        4,794         2,360
      Ceiling test
       write-down           106,011            ---      106,011           503
                            111,145        133,212      526,761       383,524
      Changes in
       operating assets
       and liabilities      (71,864)       (64,315)     (24,389)      (67,080)
        Net cash provided
         by operating
         activities          39,281         68,897      502,372       316,444
    Cash flows from
     investing activities:
      Acquisition, net
       of cash acquired         ---            ---     (264,089)          ---
      Additions to oil and
       gas properties       (79,804)       (66,075)    (497,610)     (353,856)
      Additions to
       furniture,
       fixtures and
       equipment               (655)          (594)      (4,123)       (1,691)
        Net cash used in
         investing
         activities         (80,459)       (66,669)    (765,822)     (355,547)
    Cash flows from
     financing activities:
      Proceeds from
       borrowings           378,000         61,000    1,448,000       219,000
      Repayments of
       borrowings          (343,000)       (90,000)  (1,368,000)     (210,000)
      Proceeds from
       issuance of
       senior notes             ---            ---      174,879           ---
      Proceeds from
       issuances of
       common stock, net      1,848          1,058        3,643         6,933
      Purchases of
       treasury stock           (43)           ---      (25,395)          ---
        Net cash provided
         by (used in)
        financing activities 36,805        (27,942)     273,127        15,933
    Effect of exchange
     rate changes on cash
     and cash equivalents    (2,211)           212       (1,518)         (220)

    Increase (decrease)
     in cash and cash
     equivalents             (6,584)       (25,502)       8,159       (23,390)
    Cash and cash
     equivalents,
     beginning of period     33,194         43,953       18,451        41,841

    Cash and cash
     equivalents, end
     of period              $26,610        $18,451      $26,610       $18,451

    *  Associated with adoption of SFAS 133.

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SOURCE Newfield Exploration Company
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CONTACT: Steve Campbell of Newfield Exploration Company, +1-281-847-6081, or info@newfld.com
CAPTION: NFXLOGO-b NEWFIELD EXPLORATION LOGO Newfield Exploration Company. (PRNewsFoto)[AG] HOUSTON, TX USA 01/22/2001

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