Burlington Resources Reports Second Quarter Earnings of $231 Million, Up 145 Percent; and Raises Capital Budget to $1.4 Billion.Business/Energy Editors HOUSTON--(BUSINESS WIRE)--July 18, 2001 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 estimated net income of $231 million for the second quarter of 2001, or $1.10 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, an increase of 145 percent from the same quarter a year ago. 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. (cash flow before changes in working capital) increased more than 65 percent to an estimated $557 million, as the company benefited from the continued strength in commodity prices. During the second quarter of 2000, Burlington's net income was $94 million, or $.43 per diluted share, and discretionary cash flow was $335 million. Subsequent to the quarter, Burlington's board of directors approved an increase in the company's 2001 capital budget, to $1.4 billion from $1.2 billion. Approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. half of the additional capital will fund new opportunities in Burlington's core North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. natural gas producing basins, with the remainder allocated for increased service costs. "Our performance during the quarter highlights Burlington's competitive strengths," said Bobby S. Shackouls, Burlington Resources chairman, president and chief executive officer. "We delivered operationally and repurchased 4.8 million shares of our stock, while emerging from the quarter in even stronger financial condition. In addition, we look forward to utilizing the increased capital budget to fund new drilling opportunities that are financially attractive." During the quarter, the company's natural gas production averaged 1,945 million cubic feet per day (Mmcfd), essentially flat to the prior year's quarterly average of 1,963 Mmcfd, with increases realized in Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of and 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. . Oil production averaged 69,600 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. (Bpd), compared to 79,300 Bpd during the prior year's quarter. Production of both commodities was at or above expectations. Natural gas price realizations rose substantially vs. the same period last year, to an average of $4.10 per thousand cubic feet (Mcf) during the quarter, up from $2.75 per Mcf during the prior year's quarter. Oil price realizations were $24.92 per barrel barrel: see English units of measurement. , up from $24.80 during the prior year's quarter. Exploration expenditures were $52 million during the second quarter, compared to $48 million during the prior year's quarter, and were lower than expected due to the program's timing and results. A wildcat well Noun 1. wildcat well - an exploratory oil well drilled in land not known to be an oil field wildcat oil well, oiler - a well that yields or has yielded oil drilled on Peru block 32, a well on China block 16/21 and a well in the Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. Foothills area were unsuccessful, but two partner-operated discoveries were achieved in the North Sea. Drilling continues on the Monet prospect in the Gulf of Mexico Noun 1. Gulf of Mexico - an arm of the Atlantic to the south of the United States and to the east of Mexico Golfo de Mexico Atlantic, Atlantic Ocean - the 2nd largest ocean; separates North and South America on the west from Europe and Africa on the east deepwater Deepwater or Deep Water may refer to:
 ē'–), state in the S central United States. It is bounded by Mississippi, with the Mississippi R. . During
the year's first half, exploratory drilling has yielded 10
productive wells among 29 drilled.During the second quarter the company repurchased 4.8 million shares of its common stock at an average price of $43.64. Repurchases during the year's first half under Burlington's standing $1 billion authorization The right or permission to use a system resource; the process of granting access. See access control. totaled more than 9.9 million shares or about 4.6 percent of the company's shares outstanding 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. 2000. Remaining Year Outlook The company expects third quarter 2001 natural gas production to be in the range of 1,800 to 1,950 Mmcfd. Third quarter 2001 oil production is estimated to be in the range of 60,000 to 68,000 Bpd. Full year 2001 average gas production is estimated to be in the range of 1,850 to 2,000 Mmcfd, with oil production expected to average 63,000 to 70,000 Bpd. The geographic geographic /geo·graph·ic/ (je?o-graf´ik) in pathology, of or referring to a pattern that is well demarcated, resembling outlines on a map. geographic pertaining to geography. 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. for natural gas follows:
3rd Quarter 2001 Full Year 2001
Estimate Estimate
Gas (Mmcf per day)
U.S. 1,250 - 1,300 1,265 - 1,340
Canada 430 - 490 450 - 500
Other International 120 - 160 135 - 160
-------------- -------------
Total 1,800 - 1,950 1,850 - 2,000
Preliminary estimates for exploration expense are in the range of $60-to-$90 million for the third quarter of 2001 and $250-to-$280 million for the entire year. These forecasts include estimated dry hole expense for the respective periods. Actual dry hole expense could differ based on timing and results of wells. On a gas equivalent per unit basis, third quarter and full year 2001 total cash costs, excluding production taxes, are not anticipated to change significantly from second quarter 2001. Production taxes will vary with changes in commodity prices. Depreciation, depletion depletion n. when a natural resource (particularly oil) is being used up. The annual amount of depletion may, ironically, provide a tax deduction for the company exploiting the resource because if the resource they are exploiting runs out, they will no longer be able and amortization expense is expected to be comparable to the second quarter, averaging between $.80 and $.85 per Mcf of gas equivalent for the third quarter and full year 2001. 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 , Burlington Resources is one of the world's largest independent oil and gas companies, with natural gas comprising approximately 80 percent of its reserves. The company has properties in the U.S., Canada, the United Kingdom, 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. , Africa and China. Additional information is available on the Burlington Resources Web site at www.br-inc.com. Financial statement and statistical table is attached. 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.
CONSOLIDATED STATEMENT OF INCOME
(UNAUDITED)
SECOND QUARTER SIX MONTHS
---------------- ---------------
2001 2000 2001 2000
------ ------ ------ ------
(In Millions, Except per Share Amounts)
Revenues $917 $680 $2,060 $1,388
------ ------ ------ ------
Costs and Expenses
Production Taxes 44 38 107 71
Transportation Expense 64 60 127 115
Production and Processing 121 123 241 239
Depreciation, Depletion
and Amortization 174 171 344 351
Exploration Costs 52 48 122 146
Administrative 37 39 83 78
------ ------ ------ ------
Total Costs and Expenses 492 479 1,024 1,000
------ ------ ------ ------
Operating Income 425 201 1,036 388
Interest Expense 46 53 91 103
Other Expense
(Income) - Net (1) 10 8 10
------ ------ ------ ------
Income Before Income
Taxes 380 138 937 275
Income Tax Expense 149 44 373 104
------ ------ ------ ------
Net Income Before
Cumulative Effect of
Change in Accounting
Principle 231 94 564 171
Cumulative Effect of
Change in Accounting
Principle - Net -- -- 3 --
------ ------ ------ ------
Net Income $231 $94 $567 $171
====== ====== ====== ======
Earnings per
Common Share
Basic
Before Cumulative Effect
of Change in Accounting
Principle $1.10 $.43 $2.66 $.79
Cumulative Effect of
Change in Accounting
Principle - Net -- -- .01 --
------ ------ ------ ------
Net Income $1.10 $.43 $2.67 $.79
====== ====== ====== ======
Diluted
Before Cumulative Effect
of Change in Accounting
Principle $1.10 $.43 $2.65 $.78
Cumulative Effect of
Change in Accounting
Principle - Net -- -- .01 --
------ ------ ------ ------
Net Income $1.10 $.43 $2.66 $.78
====== ====== ====== ======
Basic Common Shares 210 216 212 216
====== ====== ====== ======
Diluted Common Shares 211 216 213 217
====== ====== ====== ======
This statement should be read in conjunction with the attached
press release.
BURLINGTON RESOURCES INC.
SALES VOLUMES AND PRICES
2001 2000
----------------- ------------------------------
First Second Second Third Fourth
Quarter Quarter Quarter Quarter Quarter
----------------- ------------------------------
Daily Sales
Gas (MMCF/Day)
Domestic 1,360 1,314 1,470 1,382 1,380
Canada 479 487 379 387 403
Other
International 170 144 114 80 128
----- ----- ----- ----- -----
Total 2,009 1,945 1,963 1,849 1,911
----- ----- ----- ----- -----
Oil (MBBLS/Day)
Domestic 45.5 44.7 51.2 48.8 45.9
Canada 16.3 17.8 17.1 16.8 15.8
Other
International 8.0 7.1 11.0 7.8 8.0
----- ----- ----- ----- -----
Total 69.8 69.6 79.3 73.4 69.7
----- ----- ----- ----- -----
Average Prices
Gas ($/MCF)
Domestic $5.04 $3.99 $2.70 $3.26 $4.47
Canada 6.96 4.88 3.09 4.05 6.04
Other
International 2.94 2.50 2.17 2.31 2.58
----- ----- ----- ----- -----
Combined
including
hedging $5.32 $4.10 $2.75 $3.37 $4.68
Hedging loss
(gain) 1.60 .66 .32 .62 .76
----- ----- ----- ----- -----
Combined
before
hedging
loss
(gain) $6.92 $4.76 $3.07 $3.99 $5.44
----- ----- ----- ----- -----
Oil ($/BBL)
Domestic $25.24 $23.18 $24.74 $25.37 $23.96
Canada 30.71 28.79 24.79 31.13 31.29
Other
International 24.48 26.66 25.12 29.43 30.74
----- ----- ----- ----- -----
Combined
including
hedging 26.43 $24.92 $24.80 $27.12 $26.39
Hedging
loss
(gain) 1.72 1.62 1.58 2.33 2.63
----- ----- ----- ----- -----
Combined
before
hedging
loss
(gain) $28.15 $26.54 $26.38 $29.45 $29.02
----- ----- ----- ----- -----
Total Year
-------------------------------
2000 1999 1998
----- ----- -----
Daily Sales
Gas (MMCF/Day)
Domestic 1,441 1,487 1,580
Canada 397 429 430
Other International 122 88 67
----- ----- -----
Total 1,960 2,004 2,077
----- ----- -----
Oil (MBBLS/Day)
Domestic 51.6 57.3 66.2
Canada 17.0 19.4 21.8
Other International 9.6 13.2 16.5
----- ----- -----
Total 78.2 89.9 104.5
----- ----- -----
Average Prices
Gas ($/MCF)
Domestic $3.25 $2.49 $2.19
Canada 3.96 1.76 2.12
Other International 2.16 1.93 2.56
----- ----- -----
Combined including
hedging $3.32 $2.33 $2.19
Hedging loss
(gain) .40 (.05) (.06)
----- ----- -----
Combined before
hedging loss
(gain) $3.72 $2.28 $2.13
----- ----- -----
Oil ($/BBL)
Domestic $24.18 $16.70 $13.34
Canada 27.80 18.36 12.44
Other International 27.73 17.00 13.16
----- ----- -----
Combined including
hedging $25.40 $17.12 $13.13
Hedging loss
(gain) 2.46 .19 (.52)
----- ----- -----
Combined before
hedging loss
(gain) $27.86 $17.31 $12.61
----- ----- -----
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