Amerada Hess Reports Results for the Second Quarter of 2004.NEW YORK New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of -- Amerada Hess Corporation The Hess Corporation (NYSE: HES) is an integrated oil company based in New York City. The company changed its name from Amerada Hess as of May 8, 2006. The company explores, produces, transports, and refines oil. (NYSE NYSE See: New York Stock Exchange :AHC AHC Appalachian Hardwood Center AHC American Heritage Center (University of Wyoming, Laramie, WY) AHC American Horse Council AHC Association for History and Computing AHC Australian Heritage Commission AHC Assault Helicopter Company ) reported net income of $288 million for the second quarter of 2004 compared with income of $252 million for the second quarter of 2003. Net income in the second quarter of 2004 and 2003 includes income of $7 million and $189 million, respectively, from discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. . The after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. results by major operating activity in 2004 and 2003 are as follows:
Three months ended Six months ended
June 30 (unaudited) June 30 (unaudited)
------------------- -------------------
2004 2003 2004 2003
--------- --------- --------- ---------
(In millions, except per share amounts)
Exploration and production $ 182 $ 88 $389 $ 207
Refining and marketing 160 46 272 183
Corporate (24) (27) (26) (47)
Interest Expense (37) (44) (73) (91)
--------- --------- --------- ---------
Income from continuing
operations 281 63 562 252
Discontinued operations
Net gains from asset sales - 175 - 116
Income from operations 7 14 7 53
Income from cumulative effect
of accounting change - - - 7
--------- --------- --------- ---------
Net income $ 288 $ 252 $ 569 $ 428
========= ========= ========== =========
Income per share from
continuing operations
(diluted) $2.77 $ .71 $5.54 $2.84
========= ========= ========== =========
Net income per share
(diluted) $2.84 $2.83 $5.61 $4.81
========= ========= ========== =========
Exploration and production earnings from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the were $182 million in the second quarter of 2004 compared with $88 million in the second quarter of 2003. The Corporation's oil and gas production, on a barrel-of-oil equivalent basis, was 351,000 barrels per day Barrels per day (abbreviated BPD, bbl/d, bpd, bd or b/d) is a measurement used to describe the amount of crude oil (measured in barrels) produced or consumed by an entity in one day. in the second quarter of 2004, a decrease of 7% from the second quarter of 2003. The decline in production was primarily due to asset sales and exchanges in 2003. In the second quarter of 2004, the Corporation's average worldwide crude oil selling price, including the effect of hedging hedging, in commerce, method by which traders use two counterbalancing investment strategies so as to minimize any losses caused by price fluctuations. It is generally used by traders on the commodities market. , was $25.76 per barrel barrel: see English units of measurement. , an increase of $1.66 per barrel from the second quarter of 2003. The Corporation's average United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. natural gas selling price, including the effect of hedging, was $5.23 per Mcf in the second quarter of 2004, an increase of $1.14 per Mcf from the second quarter of 2003. Exploration and production earnings include an after-tax gain of $15 million in the second quarter of 2004 from the sale of a non-producing asset and after-tax charges of $6 million and $23 million in the second quarter of 2004 and 2003, respectively, for accrued ac·crue v. ac·crued, ac·cru·ing, ac·crues v.intr. 1. To come to one as a gain, addition, or increment: interest accruing in my savings account. 2. severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when and a reduction in leased office space in London London, city, Canada London, city (1991 pop. 303,165), SE Ont., Canada, on the Thames River. The site was chosen in 1792 by Governor Simcoe to be the capital of Upper Canada, but York was made capital instead. London was settled in 1826. . Refining refining, any of various processes for separating impurities from crude or semifinished materials. It includes the finer processes of metallurgy, the fractional distillation of petroleum into its commercial products, and the purifying of cane, beet, and maple sugar and marketing earnings were $160 million in the second quarter of 2004 compared with $46 million in the second quarter of 2003. The increase principally reflects higher refining margins and increased utilization utilization, n 1. the extent to which a given group uses a particular service in a specified period. Although usually expressed as the number of services used per year per 100 or per 1000 persons eligible for the service, utilization rates may be rates. Refining and marketing earnings in the second quarter of 2003 included a net loss of $20 million from the sale of the Corporation's interest in a shipping joint venture. Capital expenditures in the second quarter of 2004 amounted to $372 million of which $357 million related to exploration and production activities. Capital expenditures in the second quarter of 2003 amounted to $367 million, including $339 million for exploration and production.
Consolidated Financial Information (unaudited)
Three months ended Six months ended
June 30 June 30
------------------- -------------------
2004 2003 2004 2003
--------- --------- --------- ---------
(In millions, except per share amounts)
Income Statement Information
----------------------------
Sales and other operating
revenues $3,803 $3,199 $8,291 $7,453
========= ========= ========== =========
Income from continuing
operations $ 281 $ 63 $ 562 $ 252
Discontinued operations
Net gains from asset sales - 175 - 116
Income from operations 7 14 7 53
Cumulative effect of
accounting change - - - 7
--------- --------- --------- ---------
Net income $ 288 $ 252 $ 569 $ 428
========= ========= ========== =========
Income per share from
continuing operations
(diluted) $ 2.77 $ .71 $ 5.54 $ 2.84
========= ========= ========== =========
Net income per share
(diluted) $ 2.84 $ 2.83 $ 5.61 $ 4.81
========= ========= ========== =========
Weighted average number of
shares (diluted) 101.4 89.0 101.5 89.1
========= ========= ========== =========
AMERADA HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
SUPPLEMENTAL FINANCIAL DATA (UNAUDITED)
(IN MILLIONS)
Second Second First
Quarter Quarter Quarter
2004 2003 2004
-------- -------- --------
(A) (B) (C)
Line
No.
----
Income Statement
----------------
Revenues and Non-operating Income
1 Sales and other operating
revenues $ 3,803 $ 3,199 $ 4,488
Non-operating income (expense)
2 Gain (loss) on asset sales 3 (9) 19
3 Equity in income of
HOVENSA L.L.C. 97 15 51
4 Other 33 8 4
-------- -------- --------
5 Total revenues and
non-operating income 3,936 3,213 4,562
-------- -------- --------
Costs and Expenses
6 Cost of products sold 2,618 2,140 3,288
7 Production expenses 197 191 187
8 Marketing expenses 174 167 177
9 Exploration expenses, including
dry holes and lease impairment 63 88 78
10 Other operating expenses 47 49 48
11 General and administrative
expenses 96 106 76
12 Interest expense 60 77 57
13 Depreciation, depletion and
amortization 239 270 226
-------- -------- --------
14 Total costs and expenses 3,494 3,088 4,137
-------- -------- --------
15 Income from continuing operations
before income taxes 442 125 425
16 Provision for income taxes 161 62 144
-------- -------- --------
17 Income from continuing operations 281 63 281
18 Discontinued operations 7 189 --
-------- -------- --------
19 Net income $ 288 $ 252 $ 281
======== ======== ========
20 Preferred stock dividends 12 -- 12
-------- -------- --------
21 Net income applicable to common
stockholders $ 276 $ 252 $ 269
======== ======== ========
Segment Earnings Analysis
-------------------------
22 Exploration and production $ 182 $ 88 $ 207
23 Refining and marketing 160 46 112
24 Corporate (24) (27) (2)
25 Interest Expense (37) (44) (36)
-------- -------- --------
26 Income from continuing
operations 281 63 281
27 Discontinued operations 7 189 --
-------- -------- --------
28 Net income $ 288 $ 252 $ 281
======== ======== ========
29 Net Cash Provided by Operating
Activities (*) $ 438 $ 571 $ 394
------------------------------ ======== ======== ========
Capital Expenditures
--------------------
30 Exploration and production $ 357 $ 339 $ 352
31 Refining and marketing 15 28 12
-------- -------- --------
32 Total capital expenditures $ 372 $ 367 $ 364
======== ======== ========
At End of Period
----------------
33 Total debt $3,889 $4,642 $3,928
======== ======== ========
34 Stockholders' equity $5,567 $4,573 $5,489
======== ======== ========
(*) Includes changes in working capital
AMERADA HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
SUPPLEMENTAL FINANCIAL DATA (UNAUDITED)
(IN MILLIONS)
First Half
---------------------
2004 2003
---------- ----------
(A) (B)
Line
No.
---- Income Statement
----------------
Revenues and Non-operating Income
1 Sales and other operating revenues $ 8,291 $ 7,453
Non-operating income
2 Gain on asset sales 22 39
3 Equity in income of HOVENSA L.L.C. 148 65
4 Other 37 19
---------- ----------
5 Total revenues and non-operating
income 8,498 7,576
---------- ----------
Costs and Expenses
6 Cost of products sold 5,906 5,228
7 Production expenses 384 382
8 Marketing expenses 351 337
9 Exploration expenses, including dry holes
and lease impairment 141 194
10 Other operating expenses 95 100
11 General and administrative expenses 172 183
12 Interest expense 117 151
13 Depreciation, depletion and amortization 465 546
---------- ----------
14 Total costs and expenses 7,631 7,121
---------- ----------
15 Income from continuing operations before
income taxes 867 455
16 Provision for income taxes 305 203
---------- ----------
17 Income from continuing operations 562 252
18 Discontinued operations 7 169
19 Cumulative effect of change in accounting
principle, net -- 7
---------- ----------
20 Net income $ 569 $ 428
========== ==========
21 Preferred stock dividends 24 --
---------- ----------
22 Net income applicable to common
stockholders $ 545 $ 428
========== ==========
23 Net Cash Provided by Operating Activities $ 832 $ 1,059
---------------------------------------- ========== ==========
Capital Expenditures
--------------------
24 Exploration and production $ 709 $ 660
25 Refining and marketing 27 49
---------- ----------
26 Total capital expenditures $ 736 $ 709
========== ==========
June 30 Dec. 31
2004 2003
---------- ----------
Balance Sheet Information
-------------------------
27 Current assets $ 3,296 $ 3,186
28 Investments 1,243 1,095
29 Property, plant and equipment - net 8,144 7,978
30 Other assets 1,863 1,724
---------- ----------
31 Total assets $ 14,546 $ 13,983
========== ==========
32 Current portion of long-term debt $ 104 $ 73
33 Other current liabilities 3,066 2,596
34 Long-term debt 3,785 3,868
35 Deferred liabilities and credits 2,024 2,106
36 Stockholders' equity excluding other
comprehensive income (loss) 6,243 5,690
37 Accumulated other comprehensive income
(loss) (676) (350)
---------- ----------
38 Total liabilities and stockholders'
equity $ 14,546 $ 13,983
========== ==========
AMERADA HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
SUPPLEMENTAL OPERATING DATA
(IN THOUSANDS, EXCEPT FOR AVERAGE SELLING PRICES)
Second Second First
Quarter Quarter Quarter
2004 2003 2004
-------- -------- --------
(A) (B) (C)
Line
No. Operating Data
---- --------------
Net Production Per Day
----------------------
Crude oil - barrels
1 United States 41 45 40
2 United Kingdom 77 96 78
3 Norway 27 24 27
4 Equatorial Guinea 27 24 22
5 Algeria 24 15 20
6 Denmark 23 23 22
7 Gabon 11 10 13
8 Azerbaijan 2 2 2
9 Indonesia 1 1 1
-------- -------- --------
10 Total 233 240 225
======== ======== ========
Natural gas liquids - barrels
11 United States 12 9 12
12 United Kingdom 4 8 6
13 Norway 1 1 1
14 Indonesia and Thailand 1 2 2
-------- -------- --------
15 Total 18 20 21
======== ======== ========
Natural gas - mcf
16 United States 160 264 183
17 United Kingdom 306 327 282
18 Norway 27 28 28
19 Denmark 25 28 23
20 Indonesia and Thailand 83 48 86
-------- -------- --------
21 Total 601 695 602
======== ======== ========
22 Barrels of oil equivalent (*) 351 376 346
======== ======== ========
Average Selling Price (including
hedging)
--------------------------------
Crude oil - per barrel
23 United States $ 25.27 $ 23.12 $ 25.49
24 Foreign 25.87 24.31 27.10
Natural gas liquids - per barrel
25 United States $ 26.33 $ 21.84 $ 25.78
26 Foreign 29.21 19.44 23.44
Natural gas - per mcf
27 United States $ 5.23 $ 4.09 $ 5.20
28 Foreign 3.54 2.58 4.22
Marketing and Refining -
Barrels Per Day
------------------------
29 Refined products sold 404 399 483
======== ======== ========
30 Refinery runs (net) 244 215 247
======== ======== ========
(*) Includes production from properties classified as discontinued
operations of 14 thousand barrels of oil equivalent per day in the
second quarter of 2003.
AMERADA HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
SUPPLEMENTAL OPERATING DATA
(IN THOUSANDS, EXCEPT FOR AVERAGE SELLING PRICES)
First Half
---------------------
2004 2003
---------- ----------
(A) (B)
Line
No. Operating Data
---- --------------
Net Production Per Day
----------------------
Crude oil - barrels
1 United States 40 47
2 United Kingdom 77 99
3 Norway 27 24
4 Equatorial Guinea 25 25
5 Algeria 22 18
6 Denmark 23 24
7 Gabon 12 10
8 Azerbaijan 2 2
9 Indonesia 1 2
10 Colombia -- 6
---------- ----------
11 Total 229 257
========== ==========
Natural gas liquids - barrels
12 United States 12 10
13 United Kingdom 5 7
14 Norway 1 1
15 Indonesia and Thailand 2 2
---------- ----------
16 Total 20 20
========== ==========
Natural gas - mcf
17 United States 171 291
18 United Kingdom 294 324
19 Norway 28 27
20 Denmark 24 31
21 Indonesia and Thailand 85 52
---------- ----------
22 Total 602 725
========== ==========
23 Barrels of oil equivalent (*) 349 398
========== ==========
Average Selling Price (including hedging)
----------------------------------------
Crude oil - per barrel
24 United States $ 25.38 $ 23.79
25 Foreign 26.52 24.82
Natural gas liquids - per barrel
26 United States $ 26.06 $ 24.60
27 Foreign 26.08 22.81
Natural gas - per mcf
28 United States $ 5.22 $ 4.27
29 Foreign 3.87 2.81
Marketing and Refining -
Barrels Per Day
------------------------
30 Refined products sold 444 431
========== ==========
31 Refinery runs (net) 246 207
========== ==========
(*) Includes production from properties classified as discontinued
operations of 26 thousand barrels of oil equivalent per day in the
first half of 2003.
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