HOUSTON, Oct. 31 /PRNewswire/ -- Newfield Exploration Company (NYSE: NFX) today announced financial and operating results for the third quarter and first nine months of 2001. A summary of the Company's most recent operations activity is available at www.newfld.com , under the publication @NFX.
Third Quarter 2001
Stated without the effect of a non-cash gain related to SFAS 133, Newfield reported net income for the third quarter of 2001 of $35.8 million, or $0.76 per share (all per share amounts are on a diluted basis). Stated with the effect of the gain, earnings for the third quarter were $43.0 million, or $0.91 per share. Earnings for the third quarter were impacted by a non- recurring workover expense on a Gulf of Mexico well, which increased lease operating expense (LOE) and decreased earnings by $0.07 per share (after tax). This compares to net income in the third quarter of 2000 of $43.6 million, or $0.95 per share.
Revenues for the third quarter of 2001 were $183.3 million compared to revenues of $150 million in the third quarter of 2000. Operating cash flow before changes in working capital increased 20% for the third quarter of 2001 to $129.9 million, or $2.69 per share, compared to $108.6 million, or $2.32 per share, in the third quarter of 2000.
Stated on a billion cubic feet equivalent (Bcfe) basis, Newfield's total
production for the third quarter of 2001 increased 22% over the same period of
2000 to 45.7 Bcfe, or 497 million cubic feet equivalent per day (MMcfe/d).
The following tables detail quarterly production and average realized prices:
Production 3Q01 3Q00 % Change United States Natural gas (Bcf) 35.0 27.9 25% Natural gas (MMcf/d) 381 304 25% Oil and condensate production (MMBbls) 1.42 1.19 19% Oil and condensate production (BOPD) 15,414 12,930 19% Australia Oil and condensate liftings (MBbls) 359.5 372.4 (3%) Oil and condensate liftings (BOPD) 3,908 4,048 (3%) Total Natural gas (Bcf) 35.0 27.9 25% Oil and condensate liftings (MMBbls) 1.78 1.56 14% Total Production (Bcfe) 45.7 37.3 22% Average Realized Prices* 3Q01 3Q00 % Change United States Natural gas (per Mcf) $3.94 $3.86 2% Oil and condensate (per Bbl) $24.52 $24.66 (1%) Australia Oil and condensate liftings (per Bbl) $25.40 $31.68 (20%) Total Natural gas (per Mcf) $3.94 $3.86 2% Oil and condensate (per Bbl) $24.70 $26.33 (6%) * Prices shown net of transportation expense
Newfield's LOE in the third quarter of 2001, stated on a unit of production basis, was $0.66 per thousand cubic feet equivalent (Mcfe) compared to $0.48 per Mcfe in the third quarter of 2000. Higher LOE reflects increased service costs throughout our operations and a one-time expense ($5.5 million) related to an unexpected well workover program at South Marsh Island 160 in the Gulf of Mexico. Fourth quarter LOE is expected to drop significantly. Please see the fourth quarter guidance provided at the end of this release. DD&A expense for the third quarter of 2001 was $1.63 per Mcfe compared to $1.37 per Mcfe in the same period of 2000. The increase in DD&A expense reflects higher drilling and service costs and the addition of Lariat's reserves under purchase accounting rules. Newfield's general and administrative expense (including stock compensation) in the third quarter of 2001 was $0.27 per Mcfe compared to $0.24 per Mcfe in the third quarter of 2000. Higher G&A expense reflects the Company's growing workforce. Due to increased debt levels, net interest expense and dividends increased to $0.14 per Mcfe in the third quarter of 2001 compared to $0.11 per Mcfe in the same period of 2000.
Stated without the effect of a non-cash gain related to SFAS 133, Newfield reported net income for the first nine months of 2001 of $148.1 million, or $3.12 per share. Stated with the effect of a non-cash gain related to SFAS 133, earnings for the first nine months of 2001 were $158.1 million, or $3.32 per share. This compares to net income in the first nine months of 2000 of $85.8 million, or $1.92 per share.
Revenues for the first nine months of 2001 were $593.3 million compared to revenues of $363.0 million for the same period of 2000. Operating cash flow before changes in working capital increased more than 65% for the first nine months of 2001 to $415.6 million, or $8.57 per share, compared to $250.3 million, or $5.40 per share, in the first nine months of 2000.
Year-to-date 2001, oil and gas production has increased 28% over 2000 levels to 131.1 Bcfe. This compares to production in the first nine months of 2000 of 102.4 Bcfe. Year-over-year, natural gas production increased more than 30% to 101.3 Bcf, or 371 MMcf/d. Crude oil volumes year-to-date increased 20% over the same period of 2000 to 5.0 MMBbls, or an average of 18,221 BOPD. Crude oil production in the first nine months of 2000 was 4.1 MMBbls, or an average of 15,139 BOPD.
The Company's average realized natural gas price for the first nine months of 2001 was $4.59 per Mcf compared to $3.29 per Mcf in the same period of 2000. Newfield's average crude oil price for the first three quarters of 2001 was $24.93 compared to $24.97 per barrel in the same period of 2000. The Company's average realized price in Australia was $26.58 per barrel in the first nine months of 2001.
For the first nine months of 2001, the Company's LOE averaged $0.56 per Mcfe compared to $0.46 per Mcfe in the first nine months of 2000. Increased LOE is primarily related to significant increases in industry service costs. DD&A expense reflects higher drilling and service costs and increased to $1.58 per Mcfe compared to $1.35 per Mcfe for the first three quarters of 2000. Year-to-date, G&A expense (including stock compensation) per Mcfe averaged $0.27 compared to $0.22 in the same period of last year. The increase reflects the Company's growing workforce.
Capital expenditures through the end of the third quarter were $741 million, including $407 million in acquisitions. For the full-year 2001, Newfield expects to invest about $850 million.
Tables with third quarter and year-to-date 2001 summary financial information are attached.
Fourth Quarter 2001 Estimates
Below are estimates of certain significant operating and financial data for the fourth quarter of 2001. 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 fourth quarter of 2001 is expected to be 31 - 36 Bcf (340 - 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 recently acquired 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 fourth quarter of 2001 is expected to be 1.7 - 1.9 million barrels (19,000 - 21,000 BOPD). Australian oil production during the fourth quarter is expected to be 314 - 346 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 2001, the Company expects to produce at least 175 Bcfe, an increase of more than 25% over 2000 production volumes. This reflects Newfield's fourth quarter natural gas production curtailment detailed in a recent 8-K filing with the SEC.
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 fourth quarter of 2001 ($0.58 - $0.64 per Mcfe). The Company's domestic LOE, including taxes, is expected to be $0.53 - $0.58 per Mcfe in the fourth quarter of 2001. This estimate includes severance taxes of $0.05 - $0.07 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 workover activities.
General and Administrative Expense Newfield's G&A expense for the fourth quarter of 2001 is expected to be $11 - $12 million ($0.24 - $0.26 per Mcfe). This estimate includes accrual of performance-based pay.
Interest Expense The non-capitalized portion of the Company's interest expense for the fourth quarter of 2001 is expected to be $5.6 - $6.3 million ($0.12 - $0.14 per Mcfe), including a $2.3 million payment on its convertible trust preferred securities. Current borrowings under the Company's bank facilities are $94 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 fourth quarter of 2001 is expected to be about $2.4 million.
Income Taxes Including both current and deferred taxes, the Company expects its consolidated income tax rate in the fourth quarter of 2001 to be about 35%. About 60% of the tax provision is expected to be deferred.
Any publicly announced changes to these estimates will 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. Gulf Coast and offshore Australia. Newfield balances its drilling program with acquisitions in select areas in the U.S. and overseas.
**Certain of the statements set forth in this news release regarding estimated or anticipated fourth quarter operating and financial data, future commodity prices and service costs, daily, quarterly and yearly production volumes, capital expenditures and drilling plans are forward looking and are 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 firstname.lastname@example.org CONSOLIDATED STATEMENT OF INCOME (Unaudited, in 000's, except per share data) For the For the Three Months Ended Nine Months Ended September 30, September 30, 2001 2000 2001 2000 Oil and gas revenues $183,259 $150,431 $593,332 $362,957 Operating expenses: Lease operating 30,245 17,780 73,819 47,520 Transportation 1,325 1,568 4,150 4,671 Production and other taxes 3,311 1,802 15,892 3,801 Depreciation, depletion and amortization 74,259 50,989 206,982 138,382 Ceiling test write-down --- 503 --- 503 General and administrative, net 11,406 8,036 33,332 20,639 Stock compensation 729 767 2,027 2,262 Total operating expenses 121,275 81,445 336,202 217,778 Income from operations 61,984 68,986 257,130 145,179 Other income (expense): Interest income 316 580 1,458 1,502 Interest expense, gross (6,897) (3,815) (20,520) (11,552) Capitalized interest 2,354 1,374 6,508 3,938 Dividends on preferred securities of Newfield Financial Trust I (2,336) (2,336) (7,008) (7,008) Unrealized commodity derivative income * 11,101 --- 15,262 --- 4,538 (4,197) (4,300) (13,120) Income before income taxes 66,522 64,789 252,830 132,059 Income tax provision 23,546 21,237 89,972 43,908 Cumulative effect of change in accounting principles --- --- (4,794) (2,360) Net income $42,976 $43,552 $158,064 $85,791 Earnings per share: Basic $0.97 $1.02 $3.56 $2.03 Diluted $0.91 $0.95 $3.32 $1.92 Weighted average shares outstanding for basic earnings per share 44,219 42,493 44,344 42,260 Weighted average shares outstanding for diluted earnings per share 48,798 47,366 49,014 47,158 PRODUCTION DATA For the For the Three Months Ended Nine Months Ended September 30, September 30, 2001 2000 2001 2000 Average daily production: Oil and condensate (Bbls) 19,322 16,978 18,221 15,139 Gas (Mcf) 380.7 303.7 371.0 282.7 Average realized price: Oil and condensate (Bbls) $24.70 $26.33 $24.93 $24.97 Gas (Mcf) $3.94 $3.86 $4.59 $3.29 * Associated with adoption of SFAS 133. CONSOLIDATED BALANCE SHEET (Unaudited, in thousands of dollars) September 30, December 31, 2001 2000 ASSETS Current assets: Cash & cash equivalents $33,195 $18,451 Accounts receivable, oil and gas 103,641 147,643 Inventories 10,796 7,572 Commodity derivatives * 75,001 --- Other current assets 13,347 5,891 Total current assets 235,980 179,557 Oil and gas properties, net (full cost method) 1,473,357 832,907 Furniture, fixtures and equipment, net 7,049 4,028 Commodity derivatives * 16,254 --- Other assets 10,260 6,758 $1,742,900 $1,023,250 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities $172,003 $141,060 Commodity derivatives * 4,719 --- Total current liabilities 176,722 141,060 Other liabilities 7,926 6,030 Commodity derivatives * 3,117 --- Long-term debt 393,620 133,711 Deferred taxes 258,603 79,244 Total long-term liabilities 663,266 218,985 Company-obligated, mandatorily redeemable, convertible preferred securities of Newfield Financial Trust I 143,750 143,750 STOCKHOLDERS' EQUITY Common stock 448 426 Additional paid-in capital 361,663 286,811 Treasury stock (25,751) (399) Unearned compensation (8,535) (6,201) Accumulated other comprehensive income (loss) Foreign currency translation adjustment (8,106) (4,644) Commodity derivatives * 37,917 --- Retained earnings 401,526 243,462 Total stockholders' equity 759,162 519,455 Total liabilities and stockholders' equity $1,742,900 $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 Nine Months Ended September 30, September 30, 2001 2000 2001 2000 Cash flows from operating activities: Net income $42,976 $43,552 $158,064 $85,791 Depreciation, depletion and amortization 74,259 50,989 206,982 138,382 Deferred taxes 23,073 12,790 59,011 21,014 Stock compensation 729 767 2,027 2,262 Commodity derivatives * (11,101) --- (15,262) --- Cumulative effect of change in accounting principles --- --- 4,794 2,360 Ceiling test write-down --- 503 --- 503 129,936 108,601 415,616 250,312 Changes in operating assets and liabilities (19,387) 25,947 47,475 (2,765) Net cash provided by operating activities 110,549 134,548 463,091 247,547 Cash flows from investing activities: Acquisition, net of cash acquired --- --- (264,089) --- Additions to oil and gas properties (161,968) (63,799) (417,806) (287,781) Additions to furniture, fixtures and equipment (1,432) (257) (3,468) (1,097) Net cash used in investing activities (163,400) (64,056) (685,363) (288,878) Cash flows from financing activities: Proceeds from borrowings 258,000 5,000 1,110,000 158,000 Repayments of borrowings (216,000) (52,000) (1,025,000) (120,000) Proceeds from issuance of senior notes --- --- 174,879 --- Proceeds from issuances of common stock, net 443 937 1,795 5,875 Purchases of treasury stock (8,316) --- (25,352) --- Net cash provided by (used in) financing activities 34,127 (46,063) 236,322 43,875 Effect of exchange rate changes on cash and cash equivalents 130 19 694 (432) Increase (decrease) in cash and cash equivalents (18,594) 24,448 14,744 2,112 Cash and cash equivalents, beginning of period 51,789 19,505 18,451 41,841 Cash and cash equivalents, end of period $33,195 $43,953 $33,195 $43,953 * Associated with adoption of SFAS 133. 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CAPTION: NFXLOGO-b NEWFIELD EXPLORATION LOGO Newfield Exploration Company. (PRNewsFoto)[AG] HOUSTON, TX USA 01/22/2001