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Burlington Resources Reports 46 Percent Increase in Third-Quarter Earnings and 10 Percent Growth In Production.


HOUSTON -- Burlington Resources Inc. (NYSE:BR)(TSX:B) today reported estimated earnings of $389 million, or $0.98 per diluted share, during the third quarter of 2004, a new quarterly earnings record for the company. The third-quarter earnings represent a 46 percent increase over the $267 million, or $0.67 per diluted share on a post-stock-split basis, earned during the third quarter of 2003. The higher quarterly earnings were attributable to a 10 percent increase in production and to higher commodity prices. Total production grew to 2,815 million cubic feet of natural gas equivalent per day (MMcfed), from 2,551 MMcfed during the prior year's third quarter.

Net cash provided by operating activities increased to $930 million from $665 million during the prior year's quarter. Discretionary cash flow(1) increased to $814 million from $651 million during the prior year's quarter. During the first three quarters of 2004, net cash provided by operating activities totaled approximately $2.5 billion, while discretionary cash flow
Discretionary cash flow
Cash flow that is available after the funding of all positive net present value (NPV) capital investment projects; it is available for paying cash dividends, repurchasing common stock, retiring debt, and so on.
 also totaled approximately $2.5 billion.

"Burlington continues to perform very well, both operationally and financially. We are on track to deliver significant growth in 2004, while generating robust return on capital employed. This performance is consistent with our stated objectives of achieving both top-line growth and sector-leading returns to create value for our shareholders," said Bobby S. Shackouls, chairman, president and chief executive officer. "We maintain our commitment to these goals regardless of commodity price cycles."

Natural gas production during the third quarter increased 1 percent to 1,906 million cubic feet per day (MMcfd), from 1,889 MMcfd during the prior year's quarter. Natural gas liquids (NGLs) production increased 6 percent to 66.5 thousand barrels per day (Mbd), from 63.0 Mbd during the prior year's quarter. Crude oil production increased 80 percent to 85.1 Mbd, from 47.3 Mbd during the prior year's quarter.

Higher natural gas volumes were achieved from the Madden Field, South Louisiana, East Texas and the CLAM properties. Higher crude oil volumes were achieved from the Cedar Creek Anticline and Bakken areas in the Williston Basin, South Louisiana, offshore China, Algeria and Ecuador. As expected, natural gas production declined in Canada when compared to the prior year's third quarter, due to last winter's short drilling season, wet summer weather that hampered field operations, and a measured approach to capital investments in response to rising service costs and the strengthening Canadian dollar. However, Canadian natural gas production has flattened in recent months, and Burlington plans to accelerate development activity there during the balance of 2004 and 2005.

This week, Burlington placed into service the Rivers Fields facilities in the East Irish Sea Irish Sea, arm of the Atlantic Ocean, c.40,000 sq mi (103,600 sq km), 130 mi (209 km) long and up to c.140 mi (230 km) wide, lying between Ireland and Great Britain. It is connected with the Atlantic by the North Channel and (on the south) by St. George's Channel. Ireland is on its west shore, Scotland, England, and Wales on the east. The principal islands in the sea are the Isle of Man, Anglesey, and Holyhead.. During the past three years Burlington has developed the Calder Field (one of the five Rivers Fields) and installed a production platform and 30-mile pipeline to shore, while constructing a major sour gas processing plant at Barrow-in-Furness Barrow-in-Furness Furness, peninsula, 15 mi (24 km) long and 4 mi (6.4 km) wide, Cumbria, NW England, between the estuary of the River Duddon and Morecambe Bay. The term is also applied to areas N of Morecambe Bay that are part of the Lake District. In the southwest are virtually extinguished iron mines, which gave rise to the great steelworks formerly centered on Barrow-in-Furness. Farming and tourism are the peninsula's primary industries. (–fûr`nĭs), city (1991 pop. 50,174) and district, Cumbria Cumbria, county (1991 pop. 486,900), 2,635 sq mi (6,826 sq km), extreme NW England. The county stretches from the Morecambe Bay to Soloway Firth along the Irish Sea coast. It includes the Lake District, comprised of a series of volcanic rock and slate mountain peaks and lake-filled valleys. It also includes the Carlisle plain and the Eden and Kent river valleys., NW England, on the tip of the Furness peninsula. The port of Barrow has c.300 acres (121 hectares) of docks, and shipbuilding is an important industry, although much reduced in scale now. in Cumbria, England. Sales volumes are expected to ramp up to an average of approximately 90 MMcfd as the plant reaches full capacity. It is anticipated that the Calder Field's initial production would be followed in future years by gas flow from the Crossans and Darwen Darwen (där`wĭn, dăr`ĕn), town (1991 pop. 30,833), Lancashire, NW England. Engineering and the manufacture of wallpaper, paint, and plastics are the major industries. The importance of textile production in Darwen has declined. fields. The new project is expected to increase Burlington's total East Irish Sea production to approximately 180 MMcfd by early 2005.

Price realizations for natural gas during the third quarter were $5.29 per Mcf, compared to $4.68 per Mcf during the same quarter in 2003. Price realizations for NGLs were $26.26 per barrel, compared to $20.42 per barrel during the prior year's quarter. Crude oil price realizations were $40.13 per barrel, compared to $27.16 per barrel during the prior year's quarter.

During the third quarter Burlington repurchased 4 million shares of its common stock, up from approximately 3.1 million shares repurchased during each of the year's first and second quarters on a post-stock-split basis. The third quarter's repurchases totaled $150 million at an average cost of $37.56 per share. Since resuming share repurchases in late 2000, the company has acquired approximately 57.6 million shares for $1.4 billion, or an average cost of $24.30 per share on a post-stock-split basis. At the end of the third quarter, Burlington's balance sheet included nearly $1.8 billion in cash and cash equivalents, an increase of approximately $500 million during the quarter.

Outlook

Production -- Burlington expects to achieve its stated long-term growth goals during 2004 and 2005. The guidance breakdown by geographic region and product for 2004 follows:
4th-Quarter 2004     Full-Year 2004
                                   Estimate            Estimate
                              ------------------- -------------------
Gas (MMcfd)
    U.S.                          900   -    945      905   -    920
    Canada                        785   -    810      810   -    825
    Other International           170   -    240      175   -    210
                              ------------------- -------------------
         Total                  1,855   -  1,995    1,890   -  1,955

Natural Gas Liquids (Mbd)
    U.S.                         39.0   -   41.5     40.0   -   41.0
    Canada                       23.5   -   24.5     23.0   -   24.0
    Other International           0.0   -    0.0      0.0   -    0.0
                              ------------------- -------------------
         Total                   62.5   -   66.0     63.0   -   65.0

Crude Oil (Mbd)
    U.S.                         39.2   -   42.3     36.6   -   37.7
    Canada                        4.7   -    5.2      5.0   -    5.5
    Other International          34.5   -   44.5     40.5   -   43.0
                              ------------------- -------------------
         Total                   78.4   -   92.0     82.1   -   86.2

      Total Equiv. Prod.
       (MMcfed)                 2,700   -  2,943    2,761   -  2,862
                              ------------------- -------------------
                              ------------------- -------------------



For 2005 the company expects to achieve total equivalent production of 2,800 to 3,100 MMcfed.

North American Natural Gas Hedges -- As of Oct. 14, 2004, Burlington had hedged the following volumes of future North American natural gas production using costless price collars or fixed price contracts. All prices are weighted averages adjusted to a NYMEX equivalent price. Detailed information on natural gas hedging subsequent to the second quarter of 2005 as well as on the company's crude oil hedging is available on Burlington's Web site at www.br-inc.com/docs/hedge.pdf.
4th-Q. 2004     1st-Q. 2005     2nd-Q. 2005
                           -----------     -----------     -----------
   Costless collar volumes  443 MMcfd       331 MMcfd       115 MMcfd
        Floor price         $5.30/Mcf       $5.92/Mcf       $5.67/Mcf
        Ceiling price       $7.21/Mcf       $8.05/Mcf       $7.34/Mcf
   Sell swap                39 MMcfd        39 MMcfd        39 MMcfd
        Sales price         $3.71/Mcf       $3.70/Mcf       $3.70/Mcf

Other 2004 Financial Parameters -- Estimated expenses for the fourth
quarter and full year are:

                                4th-Q. 2004         Full-Year 2004
                             -------------------   -------------------
   Operating costs(a)        $0.57 to $0.61/Mcfe   $0.54 to $0.58/Mcfe
   Administrative costs      $0.17 to $0.20/Mcfe   $0.18 to $0.21/Mcfe
   Transportation costs      $0.43 to $0.47/Mcfe   $0.41 to $0.45/Mcfe
   Depletion, depreciation
    & amortization           $1.10 to $1.15/Mcfe   $1.07 to $1.12/Mcfe
   Interest expense          $68 MM to $72 MM      $275 MM to $285 MM
   Exploration costs         $70 MM to $90 MM      $250 MM to $270 MM

   (a) Formerly production and processing



In addition, Burlington anticipates an effective income tax rate of 32 to 36 percent for the full year of 2004. The breakdown between current and deferred taxes for the year could vary widely depending on commodity prices and other factors.

An income statement, statistics and non-GAAP reconciliation tables for the third quarter accompany this release.

Burlington will webcast a conference call to discuss its third-quarter 2004 earnings and operations. The call will take place on Thursday, October 21 at 1 p.m. Central time. All materials and information related to the conference call, this press release and a package of financial and statistical information may be accessed from the Burlington Resources Web site home page at www.br-inc.com by selecting the link entitled "3rd Qtr 2004 Conference Call Info Page," and then selecting the resource desired.

Burlington Resources ranks among the world's largest independent oil and gas companies, and holds one of the industry's leading positions in North American natural gas reserves and production. Headquartered in Houston, Texas, the company conducts exploration, production and development operations in the U.S., Canada, the United Kingdom, Africa, China and South America. For additional information see the Burlington Resources Web site at www.br-inc.com.
(1) See the accompanying tables for a reconciliation of GAAP and
    non-GAAP measures utilized in calculating discretionary cash flow.


FORWARD-LOOKING STATEMENTS

This press release may contain projections and other forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Any such projections or statements reflect the company's current views with respect to future events and financial performance. No assurances can be given, however, that these events will occur or that such projections will be achieved and actual results could differ materially from those projected. A discussion of important factors that could cause actual results to differ materially from those projected is included in the company's periodic reports filed with the Securities and Exchange Commission.
Burlington Resources Inc.
            Reconciliation of GAAP to Non-GAAP Measure (a)
                       Discretionary Cash Flow
                           ($ in Millions)

Below is a reconciliation of net cash provided by operating
activities to discretionary cash flow.


                                           Third Quarter       Nine
                                          ---------------     Months
                                           2004    2003        2004
                                          ------- -------   ----------
Net cash provided by operating activities   $930    $665       $2,474
  Adjustments:
   Working capital                          (125)     12            2
   Changes in other assets and liabilities     9     (26)         (25)
                                          ------- -------   ----------
Discretionary cash flow                     $814    $651       $2,451
                                          ------- -------   ----------
                                          ------- -------   ----------

(a) GAAP -- Generally Accepted Accounting Principles

Management believes that the non-GAAP measure of discretionary cash
flow is useful information for investors because it is used
internally and accepted by the investment community as a means of
measuring the company's ability to fund its capital and dividend
programs and to service its debt. Discretionary cash flow is also
useful because it is widely used by professional research analysts in
valuing, comparing ratings and providing investment recommendations
of companies in the oil and gas exploration and production industry.
Many investors use this published research in making investment
decisions.


                      BURLINGTON RESOURCES INC.
                   CONSOLIDATED STATEMENT OF INCOME
                             (UNAUDITED)


                                    THIRD QUARTER        NINE MONTHS
                                   ---------------     ---------------
                                    2004     2003       2004     2003
                                   ------   ------     ------   ------
                               (In Millions, Except per Share Amounts)

Revenues                          $1,411   $1,059     $4,052   $3,246
                                   ------   ------     ------   ------

Costs and Other Income - Net
 Taxes Other than Income Taxes        67       47        188      141
 Transportation Expense              112      100        329      301
 Operating Costs                     152      118        426      332
 Depreciation, Depletion and
  Amortization                       284      239        831      669
 Exploration Costs                    55       55        177      175
 Impairment of Oil and Gas
  Properties                           -        -          -       30
 Administrative                       54       38        153      119
 Interest Expense                     71       66        211      193
 Loss on Disposal of Assets            -        2         10        2
 Other Expense (Income) - Net         (5)      (2)        19       13
                                   ------   ------     ------   ------
   Total Costs and Other Income
    - Net                            790      663      2,344    1,975
                                   ------   ------     ------   ------

Income Before Income Taxes and
 Cumulative Effect of Change in
 Accounting Principle                621      396      1,708    1,271
Income Tax Expense                   232      129        586      398
                                   ------   ------     ------   ------

Income Before Cumulative Effect
 of Change in Accounting
 Principle                           389      267      1,122      873
Cumulative Effect of Change in
 Accounting Principle - Net            -        -          -      (59)
                                   ------   ------     ------   ------

Net Income                          $389     $267     $1,122     $814
                                   ------   ------     ------   ------
                                   ------   ------     ------   ------

Earnings per Common Share

Basic
 Before Cumulative Effect of
  Change in Accounting
  Principle                        $0.99    $0.67      $2.85    $2.19
 Cumulative Effect of Change in
  Accounting Principle - Net           -        -          -    (0.15)
                                   ------   ------     ------   ------
 Net Income                        $0.99    $0.67      $2.85    $2.04
                                   ------   ------     ------   ------
                                   ------   ------     ------   ------

Diluted
 Before Cumulative Effect of
  Change in Accounting
  Principle                        $0.98    $0.67      $2.83    $2.18
 Cumulative Effect of Change in
  Accounting Principle - Net           -        -          -    (0.15)
                                   ------   ------     ------   ------
 Net Income                        $0.98    $0.67      $2.83    $2.03
                                   ------   ------     ------   ------
                                   ------   ------     ------   ------

Basic Common Shares                  392      398        393      399
                                   ------   ------     ------   ------
                                   ------   ------     ------   ------
Diluted Common Shares                395      401        396      402
                                   ------   ------     ------   ------
                                   ------   ------     ------   ------

This statement should be read in conjunction with the attached press
release.


                      BURLINGTON RESOURCES INC.
                       SALES VOLUMES AND PRICES

----------------------------------------------------------------------
                                                     2004
                                          ----------------------------
                                           First     Second    Third
                                          Quarter   Quarter   Quarter
----------------------------------------------------------------------
Sales Volumes
  Gas (MMCF/Day)
    U.S.                                     880       905      935
    Canada                                   846       834      796
    Other International                      227       160      175
----------------------------------------------------------------------
      Worldwide                            1,953     1,899    1,906
----------------------------------------------------------------------
  NGLs (MBBLS/Day)
    U.S.                                    40.8      40.0     41.4
    Canada                                  26.1      19.0     25.1
----------------------------------------------------------------------
      Worldwide                             66.9      59.0     66.5
----------------------------------------------------------------------
  Oil (MBBLS/Day)
    U.S.                                    32.1      35.9     39.3
    Canada                                   5.8       5.3      5.0
    Other International                     44.5      43.0     40.8
----------------------------------------------------------------------
      Worldwide                             82.4      84.2     85.1
----------------------------------------------------------------------
      Total Equivalent (MMCFE/D)           2,849     2,758    2,815
----------------------------------------------------------------------

----------------------------------------------------------------------
Average Realized Prices
  Gas ($/MCF)
    U.S.                                   $5.52     $5.46    $5.28
    Canada                                  5.53      5.76     5.68
    Other International                     3.69      3.12     3.40
----------------------------------------------------------------------
  Combined including hedging                5.31      5.40     5.29
    Hedging loss (gain)                    (0.01)     0.04    (0.02)
----------------------------------------------------------------------
  Combined before hedging                  $5.30     $5.44    $5.27
----------------------------------------------------------------------
  NGLs ($/BBL)
    U.S.                                  $19.98    $21.01   $24.19
    Canada                                 25.36     29.69    29.68
----------------------------------------------------------------------
  Combined                                $22.08    $23.81   $26.26
----------------------------------------------------------------------
  Oil ($/BBL)
    U.S.                                  $31.70    $33.10   $37.15
    Canada                                 32.78     35.26    40.68
    Other International                    27.62     35.73    42.63
----------------------------------------------------------------------
  Combined including hedging               29.57     34.62    40.13
    Hedging loss (gain)                     0.32      0.77     1.51
----------------------------------------------------------------------
  Combined before hedging                 $29.89    $35.39   $41.64



                      BURLINGTON RESOURCES INC.
                       SALES VOLUMES AND PRICES

----------------------------------------------------------------------
                                 2003                Year Ended
                         ---------------------------------------------
                            Third     Fourth
                           Quarter   Quarter    2003    2002    2001
----------------------------------------------------------------------
Sales Volumes
  Gas (MMCF/Day)
    U.S.                     848        870      865     949    1,121
    Canada                   873        876      867     802      433
    Other International      168        211      167     165      170
----------------------------------------------------------------------
      Worldwide            1,889      1,957    1,899   1,916    1,724
----------------------------------------------------------------------
  NGLs (MBBLS/Day)
    U.S.                    35.9       43.1     37.4    32.7     34.6
    Canada                  27.1       26.1     27.4    27.4     12.5
----------------------------------------------------------------------
      Worldwide             63.0       69.2     64.8    60.1     47.1
----------------------------------------------------------------------
  Oil (MBBLS/Day)
    U.S.                    30.0       30.7     29.3    35.4     44.0
    Canada                   5.2        4.9      5.1     7.8     11.9
    Other International     12.1       22.9     12.1     5.9      7.3
----------------------------------------------------------------------
      Worldwide             47.3       58.5     46.5    49.1     63.2
----------------------------------------------------------------------
      Total Equivalent
       (MMCFE/D)           2,551      2,723    2,567   2,571    2,386
----------------------------------------------------------------------

----------------------------------------------------------------------
Average Realized Prices
  Gas ($/MCF)
    U.S.                   $4.91      $4.38    $4.87   $3.39    $3.99
    Canada                  4.90       4.57     5.12    3.17     4.60
    Other International     2.46       3.81     3.07    2.27     2.83
----------------------------------------------------------------------
  Combined including
   hedging                  4.68       4.40     4.83    3.20     4.03
    Hedging loss (gain)     0.04       0.03     0.09   (0.16)    0.48
----------------------------------------------------------------------
  Combined before hedging  $4.72      $4.43    $4.92   $3.04    $4.51
----------------------------------------------------------------------
  NGLs ($/BBL)
    U.S.                  $17.81     $18.96   $18.42  $13.23   $14.75
    Canada                 23.88      23.16    23.08   15.92    22.50
----------------------------------------------------------------------
  Combined                $20.42     $20.54   $20.40  $14.46   $16.79
----------------------------------------------------------------------
  Oil ($/BBL)
    U.S.                  $27.66     $27.09   $28.08  $23.16   $22.63
    Canada                 32.30      28.52    31.11   28.32    26.51
    Other International    23.67      22.48    23.49   24.30    23.42
----------------------------------------------------------------------
  Combined including
   hedging                 27.16      25.40    27.22   24.11    23.45
    Hedging loss (gain)        -          -     0.09   (0.18)    1.10
----------------------------------------------------------------------
  Combined before hedging $27.16     $25.40   $27.31  $23.93   $24.55

COPYRIGHT 2004 Business Wire
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2004, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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