Occidental Petroleum Corporation ( OXY ) reported
first-quarter 2013 pro forma earnings of $1.69, beating the Zacks
Consensus Estimate by 12 cents. Quarterly earnings were however
lower than the prior-year earnings of $1.92 per share.MARATHON OIL CP (MRO): Free Stock Analysis
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On a GAAP basis, the company's quarterly earnings per share were
$1.68 versus $1.92 a year-ago. The variance between pro forma and
GAAP earnings was due to a penny's charge from the discontinued
Occidental Petroleum reported first-quarter revenues of $5.9
billion, beating the Zacks Consensus Estimate by $80 million.
Revenues decreased 6.3% year over year due to lower contribution
from the oil and gas segment.
First-Quarter 2013 Production, Sales and Realized
Occidental Petroleum's average daily production volumes were 763
thousand barrels of oil equivalents (MBoe), up 1.1% from 755 MBoe a
year-ago. The growth was primarily attributable to a 5.1%
year-over-year rise in domestic productions.
During the quarter, the company's daily oil and gas sales volumes
increased marginally to 746 MBoe from the year-ago level.
Realized price for crude oil decreased to $98.07 per barrel from
the prior-year level of $107.98 per barrel. Realized worldwide
natural gas liquids (NGL) prices were down 23.3% at $40.27 per
barrel from the prior-year quarter level of $52.51 per barrel.
Domestic gas prices increased 8.5% year over year to $3.08 per
thousand cubic feet (Mcf).
Oil and Gas: Earnings from this segment were $1.9
billion in first-quarter 2013, down 24% year over year due to
higher depreciation, depletion and amortization expenses, lower
natural gas and NGL prices, and decline in sales volumes in the
Middle East and North Africa. These were partially offset by lower
operating expenses and increase in domestic liquids volumes.
Chemicals: Earnings were $159 million versus $184
million a year-ago. A 3.6% year-over-year decline was primarily due
to higher natural gas costs, weak demand and pricing for
chlorinated organics; partially compensated by an increase in
export volumes of caustic soda.
Midstream, Marketing and Other: Segmental
earnings were $215 million, up 64.1% year over year due to strong
results from marketing and trading operations.
Occidental Petroleum's cash from operations during the first three
months of 2013 totaled $2.7 billion compared with $2.8 billion in
the year-ago comparable period.
Capital expenditure for first-quarter 2013 was $2.1 billion
compared with $2.4 billion in the year-ago quarter. This decline
was primarily due to a 12.5% year-over-year decrease in expenses in
the oil and gas segment.
Total long-term debt as of Mar 31, 2013, was $7,624 million
compared with $7,623 million as of Dec 31, 2012. The company's
total debt-to-capitalization ratio at quarter-end was 16%,
unchanged from Dec 31, 2012.
The results of Occidental Petroleum were primarily driven by
strong performance by its domestic operations and rise in domestic
natural gas prices. The company's marketing and trading operations
also contributed significantly in the reported quarter.
Occidental Petroleum also takes several cost-cutting measures,
including reduction of domestic wells, to manage higher
international operating expenses from its planned maintenance
turnarounds in Qatar.
However, risks associated with the damage of oil exploration and
production infrastructure, delay in drilling and development
activities, and over-reliance on the crude oil price movement may
to some extent challenge the company's future performance.
Occidental Petroleum Corporation currently has a Zacks Rank #3
Los Angeles, Calif.-based Occidental Petroleum along with its
subsidiaries operates as an oil and gas exploration and production
company. Other players from the sector - Murphy Oil
Corporation ( MUR ), Marathon
Oil Corporation ( MRO ) and Penn
Virginia Corporation ( PVA ) - are yet to
announce their quarterly results.