U.S. energy firm Apache Corp. APA reported third-quarter loss per share – excluding one-time items – of 5 cents, narrower than the Zacks Consensus Estimate of a loss of 38 cents. The outperformance came on the back of strong North American liquids production.
However, Apache’s performance deteriorated from the year-ago adjusted profit of $1.27 per share amid a plunge in oil prices.
Apache Corporation (APA) - Earnings Surprise | FindTheCompany
Revenues of $1,496 million were down 57% from the year-ago quarter and were also below the Zacks Consensus Estimate of $1,589 million.
Operational Performance
The production of oil and natural gas (excluding divested assets and non-controlling interests) averaged 486,409 oil-equivalent barrels per day (BOE/d) (65% liquids), up 7% year over year. Apache’s production for oil and natural gas liquids (NGLs) was up 7% at 313,923 barrels per day (Bbl/d), while natural gas production of 1,034.9 million cubic feet per day (MMcf/d) was 8% higher from the third quarter 2014 level.
The average realized crude oil price during the third quarter was $46.34 per barrel, representing a decrease of 51% from the year-ago realization of $94.38. Moreover, the average realized natural gas price during the September quarter of 2015 was $2.89 per thousand cubic feet (Mcf), down 23% from the year-ago period.
Balance Sheet, Capital Spending & Lease Operating Expenses
As of Sep 30, 2015, Apache had approximately $1,655 million in cash and cash equivalents. The Zacks Rank #2 (Buy) company had a long-term debt of $8,777 million, representing a debt-to-capitalization ratio of 47.2%.
During Jul-Sep period, Apache’s exploration and development investments totaled $860 million, 66% lower than the $2,538 million incurred a year ago. The company – like many other oil and gas players including ConocoPhillips COP, Chesapeake Energy Corp. CHK and Marathon Oil Corp. MRO – has adjusted its spending plans considerably amid diving crude prices.
But what is encouraging is the fact that production volumes are likely to increase 10-12% in 2015 despite a massive decrease in budgeted capital expenditures from 2014 levels.
Apache’s lease operating expenses totaled $450 million, down 23% from $588 million in the year-ago quarter.
Guidance
Driven by better-than-expected North American production, Apache has raised 2015 guidance for the region to 307,000 to 309,000 BOE/d.
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Click to get this free report CHESAPEAKE ENGY (CHK): Free Stock Analysis Report CONOCOPHILLIPS (COP): Free Stock Analysis Report APACHE CORP (APA): Free Stock Analysis Report MARATHON OIL CP (MRO): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research