Burlington Resources Reports Record Quarterly Earnings.HOUSTON Houston, city (1990 pop. 1,630,553), seat of Harris co., SE Tex., a deepwater port on the Houston Ship Channel; inc. 1837. Economy The fourth largest city in the nation and the largest in the entire South and Southwest, Houston is a port of entry; -- Burlington Resources Burlington Resources, is an American oil and gas company. Their headquarters are in Houston, Texas. Based in Houston, Texas, BR has major offices located in Calgary, London, Farmington, Midland and Fort Worth. Inc. (NYSE NYSE See: New York Stock Exchange :BR) today reported record estimated quarterly earnings of $471 million, or $1.21 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, during the first quarter of 2005, a 33 percent increase over the $354 million, or $0.89 per diluted share on a post-stock-split basis, earned during the first quarter of 2004. The increase was primarily attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to higher commodity prices. Total production was stable at 2,846 million cubic feet of natural gas equivalent per day (MMcfed), compared to 2,849 MMcfed during the prior year's quarter. Net cash provided by operating activities increased to $819 million from $742 million during the prior year's quarter. 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. (1) increased to $946 million, also a quarterly record, from $812 million during the prior year's quarter. The quarter's financial highlights included annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. return on capital employed Return on capital employed (ROCE) Indicator of profitability of the firm's capital investments. Determined by dividing Earnings Before Interest and Taxes by (capital employed plus short-term loans minus intangible assets). (1) of 23.5 percent, another quarterly record. Burlington Burlington, town, Canada Burlington, town (1991 pop. 129,575), SE Ont., Canada, on Lake Ontario. First settled (1798) by Mohawk Loyalist Joseph Brandt, Burlington's economy was built on the shipment of wheat, lumber, and quarried rock by waterway. met volume expectations, as North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. production for the quarter increased 3 percent from the first quarter of 2004. Higher oil volumes in the East Lookout Butte Butte, city, United States Butte (by  t), city (1990 pop. 33,336), seat of Silver Bow co., SW Mont.; inc. 1879. It is a trade, ranching, and industrial center. , Cedar Hills Cedar Hills is the name of two towns in the United States:
BASIN Brothers And Sisters In Need and higher natural gas volumes from the Madden mad·den v. mad·dened, mad·den·ing, mad·dens v.tr. 1. To make angry; irritate. 2. To drive insane. v.intr. To become infuriated. Field in Wyoming Wyoming, city, United States Wyoming, city (1990 pop. 63,891), Kent co., W Mich., in the greater Grand Rapids metropolitan area, on the Grand River; settled 1832, inc. 1959. and the new Savell Field in the Bossier Bossier may refer to:
n. A beginning; a start, as of a cold. of warm weather. Repairs continue on the Rivers natural gas processing Natural gas processing plants, or fractionators, are used to purify the raw natural gas extracted from underground gas fields and brought up to the surface by gas wells. The processed natural gas, used as fuel by residential, commercial and industial consumers, is almost pure plant in the U.K., and Burlington is auditing the design of certain components and addressing construction and operational issues that occurred during commissioning and start-up Start-up The earliest stage of a new business venture. . Subsequent to the quarter, Burlington sanctioned future development of new offshore natural gas fields This list of natural gas fields includes major fields of the past and present. N.B. Some of the items listed are basins or projects that comprise many fields (e.g. Sakhalin has three fields: Chayvo, Odoptu, and Arkutun-Dagi). in Egypt Egypt (ē`jĭpt), Arab. Misr, biblical Mizraim, officially Arab Republic of Egypt, republic (2005 est. pop. 77,506,000), 386,659 sq mi (1,001,449 sq km), NE Africa and SW Asia. as well as expansion of oil producing and processing facilities in Algeria Algeria (ăljēr`ēə), Arab. Al Djazair, Fr. Algérie, officially People's Democratic Republic of Algeria, republic (2005 est. pop. , both pending full governmental approvals. "Burlington delivered outstanding financial performance while our large asset base enabled us to meet production expectations during a highly active quarter," said Bobby S. Shackouls, chairman, president and chief executive officer. "We also met expectations on costs. While the entire industry faces increasing cost pressures, we have some natural advantages and remain focused on conducting our programs efficiently and effectively. At the same time, we are making progress on several projects that we expect to contribute to future growth." Expenditures on common stock repurchases Stock repurchase A firm's repurchase of outstanding shares of its common stock. more than doubled to $186 million during the quarter, as Burlington repurchased 4 million shares at an average cost of $46.60 per share, compared to the $90 million spent on repurchases during the first quarter of 2004. With these repurchases, the number of shares outstanding decreased to approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 385 million as of March 31, 2005, from 388 million at year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. 2004. Approximately $766 million remained in the current share repurchase Share Repurchase A program by which a company buys back its own shares from the marketplace, reducing the number of outstanding shares. This is usually an indication that the company's management thinks the shares are undervalued. authorization The right or permission to use a system resource; the process of granting access. See access control. at the end of the quarter. Cash and cash equivalents on the company's balance sheet were essentially unchanged from year-end 2004. Natural gas production during the first quarter was 1,896 million cubic feet per day (MMcfd), compared to 1,953 MMcfd during the prior year's quarter. Natural gas liquids (NGLs) production increased 2 percent to 68.4 thousand 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. (Mbd), from 66.9 Mbd during the prior year's quarter. Crude oil production increased 9 percent to 89.9 Mbd, from 82.4 Mbd during the prior year's quarter. The company benefited from higher commodity prices during the quarter, with price realizations for natural gas of $5.90 per Mcf, compared to $5.31 per Mcf during the same quarter in 2004. Price realizations for NGLs were $28.40 per barrel barrel: see English units of measurement. , compared to $22.08 per barrel during the prior year's quarter. Crude oil price realizations were $47.57 per barrel, compared to $29.57 per barrel during the prior year's quarter. 2005 Outlook
Production - Burlington's production guidance for 2005 is unchanged,
with total production of 2,800 to 3,000 MMcfed expected. This range
assumes no significant volumes from the Rivers facility.
2nd-Quarter 2005 Full-Year 2005
Estimate Estimate
--------------------- ---------------------
Gas (MMcfd)
U.S. 950 - 990 950 - 995
Canada 785 - 820 785 - 825
International 120 - 150 155 - 185
--------------------- ---------------------
Total 1,855 - 1,960 1,890 - 2,005
Natural Gas Liquids (Mbd)
U.S. 42.0 - 44.5 42.0 - 45.0
Canada 23.5 - 25.5 24.0 - 26.0
International 0.0 - 0.0 0.0 - 0.0
--------------------- ---------------------
Total 65.5 - 70.0 66.0 - 71.0
Crude Oil (Mbd)
U.S. 44.0 - 47.0 46.0 - 49.0
Canada 5.0 - 6.0 5.0 - 6.0
International 34.5 - 39.0 35.0 - 39.5
--------------------- ---------------------
Total 83.5 - 92.0 86.0 - 94.5
Total Equiv. Prod.
(MMcfed) 2,750 - 2,930 2,800 - 3,000
--------------------- ---------------------
--------------------- ---------------------
North American Natural Gas Hedges - As of March 31, 2005, 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.
2nd-Q. 2005 3rd-Q. 2005 4th-Q. 2005
----------- ----------- -----------
Costless collar volumes 388 MMcfd 388 MMcfd 385 MMcfd
Floor price $6.05/Mcf $6.05/Mcf $6.21/Mcf
Ceiling price $7.63/Mcf $7.63/Mcf $7.90/Mcf
Sell swap 39 MMcfd 21 MMcfd 9 MMcfd
Sales price $3.87/Mcf $3.84/Mcf $3.76/Mcf
Additional information on North American natural gas hedging
subsequent to the fourth quarter of 2005, natural gas hedging in the
U.K. and crude oil hedging, is available on Burlington's Web site at
www.br-inc.com/docs/hedge.pdf.
Other 2005 Financial Parameters - Estimated expenses for the second
quarter and full year are:
2nd-Q. 2005 Full-Year 2005
----------- --------------
Operating costs $0.64 to $0.67/Mcfe $0.60 to $0.64/Mcfe
Administrative costs $0.17 to $0.20/Mcfe $0.16 to $0.19/Mcfe
Transportation expenses $0.48 to $0.52/Mcfe $0.47 to $0.51/Mcfe
Depreciation, depletion
& amortization $1.25 to $1.30/Mcfe $1.25 to $1.35/Mcfe
Interest expense $68 MM to $72 MM $270 MM to $290 MM
Exploration costs $65 MM to $85 MM $275 MM to $300 MM
In addition, Burlington anticipates an effective income tax rate of 34 to 38 percent for the full year of 2005. The breakdown breakdown /break·down/ (brak´doun) 1. the act or process of ceasing to function. 2. an often sudden collapse in health. 3. loss of self-control. between current and deferred taxes for the year could vary widely depending on commodity prices and other factors. A financial statement, as well as statistics and non-GAAP (generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting ) reconciliation tables, accompany To go along with; to go with or to attend as a companion or associate. A motor vehicle statute may require beginning drivers or drivers under a certain age to be accompanied by a licensed adult driver whenever operating an automobile. this release. Burlington will webcast a conference call to discuss its first-quarter earnings and results, as well as future operations, on Friday Friday: see Sabbath; week. Friday young Indian rescued by Crusoe and kept as servant and companion. [Br. Lit.: Robinson Crusoe] See : Servant , April 29 at 8 a.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 (www.br-inc.com) by selecting the link entitled en·ti·tle tr.v. en·ti·tled, en·ti·tling, en·ti·tles 1. To give a name or title to. 2. To furnish with a right or claim to something: "1st Qtr 2005 Conference Call Info INFO Information INFO Information (logging abbreviation) INFO Inform(ed/ation) INFO Ionic Difluoroamino Oxidizer " 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 “Houston” redirects here. For other uses, see Houston (disambiguation). Houston (pronounced /'hjuːstən/) is the largest city in the state of Texas and the , the company conducts exploration, production and development operations in the U.S., Canada, the United Kingdom, Africa, China and South America South America, fourth largest continent (1991 est. pop. 299,150,000), c.6,880,000 sq mi (17,819,000 sq km), the southern of the two continents of the Western Hemisphere. . For additional information see the Burlington Resources Web site at www.br-inc.com. (1) See the accompanying ac·com·pa·ny v. ac·com·pa·nied, ac·com·pa·ny·ing, ac·com·pa·nies v.tr. 1. To be or go with as a companion. 2. tables for a reconciliation of GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). and non-GAAP measures utilized in calculating discretionary cash flow, return on capital employed and net debt to total capitalization Total capitalization The total long-term debt and all types of equity of a company that constitutes its capital structure. total capitalization See capitalization. , as well as statements of why management believes these measures are useful information for investors. FORWARD-LOOKING STATEMENTS forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. 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 a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. . 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.
First Quarter
----------------
2005 2004
-------- -------
Net Cash Provided by Operating Activities $819 $742
Adjustments:
Working Capital 125 63
Changes in Other Assets and Liabilities 2 7
-------- -------
Discretionary Cash Flow $946 $812
-------- -------
-------- -------
(a) GAAP - Generally Accepted Accounting Principles
Management believes that the Non-GAAP measure of discretionary cash
flow is useful information for investors because it is used
internally and accepted by the investment community as a means of
measuring the company's ability to fund its capital and dividend
programs and to service its debt. Discretionary cash flow is also
useful because it is widely used by professional research analysts
in valuing, comparing ratings and providing investment
recommendations of companies in the oil and gas exploration and
production industry. Many investors use this published research in
making investment decisions.
Burlington Resources Inc.
Reconciliation of GAAP to Non-GAAP Measure (a)
Net Debt to Total Capital Ratio
($ in Millions)
Below is a reconciliation of total debt to total capital ratio to net
debt to total capital ratio.
March 31, December 31,
2005 2004
------------ ------------
Total Debt $3,888 $3,889
Stockholders' Equity 7,169 7,011
------------ ------------
Total Capital $11,057 $10,900
------------ ------------
------------ ------------
Total Debt $3,888 $3,889
Adjustment:
Less: Cash and Cash Equivalents 2,227 2,179
------------ ------------
Net Debt $1,661 $1,710
------------ ------------
------------ ------------
Net Debt $1,661 $1,710
Stockholders' Equity 7,169 7,011
------------ ------------
Total Adjusted Capital $8,830 $8,721
------------ ------------
------------ ------------
Total Debt to Total Capital Ratio 35% 36%
Adjustment:
Less: Impact of Cash and Cash
Equivalents 16% 16%
------------ ------------
Net Debt to Total Capital Ratio 19% 20%
------------ ------------
------------ ------------
(a) GAAP - Generally Accepted Accounting Principles
Total debt to total capital ratio is calculated by dividing total
debt by total debt plus stockholders' equity. Management believes
that total debt to total capital ratio is useful to investors
because it is helpful in determining a company's leverage.
Management also believes that since it has the ability to and may
elect to use a portion of cash and cash equivalents to retire debt
or incur additional expenditures without increasing debt, it is
appropriate to apply cash and cash equivalents to debt in
calculating net debt to total capital (Non-GAAP).
Burlington Resources Inc.
Return on Capital Employed Annualized (ROCE)
Reconciliation of GAAP to Non-GAAP Measure
($ in Millions)
Net Income (For the Quarter Ended 3/31/05) $1,883
Add: Interest Expense After Tax 179
------------
Earnings Before Interest Expense (After Tax) $2,062
------------
------------
March 31, December 31,
2005 2004 Average
------------ ------------ ------------
Total Debt (GAAP) $3,888 $3,889 $3,889
Less: Cash and Cash
Equivalents 2,227 2,179 2,203
------------ ------------ ------------
Net Debt (Non-GAAP) 1,661 1,710 1,686
Stockholders' Equity 7,169 7,011 7,090
------------ ------------ ------------
Total Capital net of Cash and
Cash Equivalents 8,830 8,721 8,776
Plus: Cash and Cash
Equivalents 2,227 2,179 2,203
------------ ------------ ------------
Total Capital (GAAP) $11,057 $10,900 $10,979
------------ ------------ ------------
------------ ------------ ------------
ROCE (GAAP)-3/31/05 18.8%
Impact of Cash and Cash Equivalents 4.7%
------------
ROCE (Non-GAAP)-3/31/05 23.5%
------------
------------
ROCE is defined as net income plus after-tax interest expense divided
by average capital (total debt plus stockholders' equity). Above is a
reconciliation of ROCE calculated using net debt (total debt less
cash and cash equivalents) in the average capital calculation
(considered Non-GAAP) compared to ROCE calculated using total debt in
average capital calculation.
(Note: interest expense is taxed based on the company's effective tax
rate.)
Management believes that ROCE is a useful measure because it indicates
the return on all capital, which includes equity and debt, employed in
the business. Management believes that since it has the ability to and
may elect to use a portion of the cash and cash equivalents to retire
debt, the debt balance has been reduced for cash and cash equivalents.
Management also believes that ROCE is an additional measure of
efficiency when considered in conjunction with return on equity which
measures the return on only the shareholders' equity component of
total capital employed.
BURLINGTON RESOURCES INC.
CONSOLIDATED STATEMENT OF INCOME
(UNAUDITED)
First Quarter
-------------------------
2005 2004
------------ ------------
(In Millions, Except
per Share Amounts)
Revenues $1,576 $1,308
------------ ------------
Costs and Other Income - Net
Taxes Other than Income Taxes 74 59
Transportation Expense 117 110
Operating Costs 154 131
Depreciation, Depletion and Amortization 328 277
Exploration Costs 51 60
Administrative 51 48
Interest Expense 70 71
(Gain)/Loss on Disposal of Assets (1) 8
Other Income - Net (7) (3)
------------ ------------
Total Costs and Other Income - Net 837 761
------------ ------------
Income Before Income Taxes 739 547
Income Tax Expense 268 193
------------ ------------
Net Income $471 $354
------------ ------------
------------ ------------
Basic Earnings per Common Share $1.22 $0.90
------------ ------------
------------ ------------
Diluted Earnings per Common Share $1.21 $0.89
------------ ------------
------------ ------------
This statement should be read in conjunction with the attached press
release.
BURLINGTON RESOURCES INC.
SALES VOLUMES AND PRICES
First Quarter Year Ended
----------------------------------------
2005 2004 2004 2003 2002
----------------------------------------------------------------------
Sales Volumes
Gas (MMCF/Day)
U.S. 906 880 908 865 949
Canada 809 846 819 867 802
International 181 227 187 167 165
----------------------------------------------------------------------
Worldwide 1,896 1,953 1,914 1,899 1,916
----------------------------------------------------------------------
NGLs (MBBLS/Day)
U.S. 43.5 40.8 41.7 37.4 32.7
Canada 24.9 26.1 23.6 27.4 27.4
----------------------------------------------------------------------
Worldwide 68.4 66.9 65.3 64.8 60.1
----------------------------------------------------------------------
Oil (MBBLS/Day)
U.S. 43.8 32.1 37.2 29.3 35.4
Canada 5.8 5.8 5.5 5.1 7.8
International 40.3 44.5 42.5 12.1 5.9
----------------------------------------------------------------------
Worldwide 89.9 82.4 85.2 46.5 49.1
----------------------------------------------------------------------
Total Equivalent
(MMCFE/D) 2,846 2,849 2,817 2,567 2,571
----------------------------------------------------------------------
----------------------------------------------------------------------
Average Realized Prices
Gas ($/MCF)
U.S. $5.74 $5.52 $5.54 $4.87 $3.39
Canada 6.21 5.53 5.85 5.12 3.17
International 5.26 3.69 3.64 3.07 2.27
----------------------------------------------------------------------
Combined including hedging 5.90 5.31 5.49 4.83 3.20
Hedging loss (gain) (0.07) (0.01) 0.01 0.09 (0.16)
----------------------------------------------------------------------
Combined before hedging $5.83 $5.30 $5.50 $4.92 $3.04
----------------------------------------------------------------------
NGLs ($/BBL)
U.S. $23.68 $19.98 $22.87 $18.42 $13.23
Canada 36.39 25.36 29.79 23.08 15.92
----------------------------------------------------------------------
Combined $28.40 $22.08 $25.38 $20.40 $14.46
----------------------------------------------------------------------
Oil ($/BBL)
U.S. $46.72 $31.70 $36.31 $28.08 $23.16
Canada 44.75 32.78 37.70 31.11 28.32
International 49.39 27.62 35.94 23.49 24.30
----------------------------------------------------------------------
Combined including hedging 47.57 29.57 36.25 27.22 24.11
Hedging loss (gain) 0.21 0.32 0.99 0.09 (0.18)
----------------------------------------------------------------------
Combined before hedging $47.78 $29.89 $37.24 $27.31 $23.93
----------------------------------------------------------------------
----------------------------------------------------------------------
|
|
||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion