UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 1, 2018
APACHE CORPORATION
(Exact name of registrant as specified in its charter)
Delaware | 1-4300 | 41-0747868 | ||
(State or other jurisdiction of incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
2000 Post Oak Boulevard
Suite 100
Houston, Texas 77056-4400
(Address of principal executive offices) (Zip Code)
Registrants telephone number, including area code: (713) 296-6000
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
The information in this Current Report on Form 8-K, including Exhibit 99.1 furnished herewith, is being furnished and shall not be deemed filed for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of Section 18, and shall not be incorporated by reference in any filing under the Securities Act or the Exchange Act, except as set forth by specific reference in such filing.
Item 2.02. | Results of Operations and Financial Condition. |
On August 1, 2018, Apache Corporation issued a press release announcing financial and operating results for the fiscal quarter ended June 30, 2018. The full text of the press release is furnished herewith as Exhibit 99.1 and incorporated herein by reference.
Item 9.01. | Financial Statements and Exhibits. |
(d) Exhibits.
Exhibit No. |
Description | |
99.1 | Press Release of Apache Corporation dated August 1, 2018. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
APACHE CORPORATION | ||||
Date: August 2, 2018 | /s/ Rebecca A. Hoyt | |||
Rebecca A. Hoyt | ||||
Senior Vice President, Chief Accounting Officer, and Controller (Principal Accounting Officer) |
Exhibit 99.1
NEWS RELEASE
APACHE CORPORATION ANNOUNCES SECOND-QUARTER 2018
FINANCIAL AND OPERATIONAL RESULTS
| Reported second-quarter production of 464,000 barrels of oil equivalent (BOE) per day and adjusted production of 390,000 BOE per day, which excludes Egypt noncontrolling interest and tax barrels; |
| Delivered U.S. production of 255,000 BOE per day, exceeding guidance by 7,000 BOE per day driven by strong oil production in the Permian Basin; |
| Achieved record Permian Basin production of 202,000 BOE per day; |
| Reported Alpine High net production of 32,000 BOE per day during the quarter, which increased approximately 70 percent to 54,000 BOE per day by the end of July; |
| Realized significant capital efficiency improvements in the Permian Basin, reducing both Midland Basin completion cycle times and Alpine High well costs per lateral foot by 25 percent over 2017 averages; and |
| Raising 2018 U.S. production guidance to 260,000 BOE per day, from previous guidance of 250,000 to 258,000 BOE per day. |
HOUSTON, Aug. 1, 2018 Apache Corporation (NYSE: APA) (Nasdaq: APA) today announced its financial and operational results for the second quarter of 2018.
Apache reported earnings of $195 million or $0.51 per diluted common share for the second quarter of 2018. These results include a number of items outside of core earnings that are typically excluded by the investment community in their published earnings estimates. When adjusted for these and certain additional items that impact the comparability of results, Apaches second-quarter earnings were $192 million or $0.50 per share. Net cash provided by operating activities in the quarter was $1.1 billion. Before working capital changes, Apache generated $932 million in operating cash flow. Adjusted earnings before interest, taxes, depreciation, depletion, amortization and exploration expenses (adjusted EBITDAX) was $1.3 billion.
APACHE CORPORATION ANNOUNCES SECOND-QUARTER 2018 FINANCIAL AND OPERATIONAL RESULTS
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Apaches operational and strategic delivery have been exceptional through the first half of 2018. We are proactively managing our costs, operating at an activity level that maximizes capital efficiency, and we have established considerable momentum that is now showing up in our results, said John J. Christmann IV, Apaches chief executive officer and president. In the United States, the Permian Basin was our primary growth driver, with oil production in the Midland and Delaware basins up 20,000 barrels per day year-over-year and 6,000 barrels per day over the first quarter.
Second-quarter operational summary
Highlights from the companys three principal areas include:
| United States U.S. production averaged 255,000 BOE per day. The company averaged 17 rigs and drilled and completed 70 gross-operated wells. |
| Permian Basin Second-quarter production in the Permian Basin averaged 202,000 BOE per day, with total production up 39 percent and oil up 25 percent year-over-year. |
| Midland Basin Activity continues to focus on pad development in the Wolfcamp and Spraberry formations. During the quarter, the company brought 22 wells online in the Midland Basin. Learnings from strategic testing are enabling highly efficient and optimized full-field development. Apache has recently made significant changes to its completion designs, resulting in lower cycle times and cost reductions of nearly $400,000 for the average completion. |
APACHE CORPORATION ANNOUNCES SECOND-QUARTER 2018 FINANCIAL AND OPERATIONAL RESULTS
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| Delaware Basin Apaches activity in the Delaware Basin includes operations in Dixieland and Alpine High in Reeves County and the slope play in southeast New Mexico. The company brought 41 Delaware Basin wells online, most of which were late in the quarter. |
At Alpine High, production in the second quarter averaged 32,000 BOE per day, a 23-percent increase over the first quarter of 2018. Well costs in the play continue to come down despite upward pressure on service costs. Year-to-date, average costs per treated lateral foot are down by 25 percent. After analyzing successful results from its strategic testing programs, the company is increasing its investment in longer laterals and larger stimulations.
| Egypt Apache averaged 13 rigs during the quarter and drilled and completed 34 gross-operated wells. Adjusted production in Egypt, which excludes minority interest and the impact of tax barrels, averaged 80,000 BOE per day. The company recently added a third new concession of 650,000 gross acres in the East Bahariya area, bringing Apaches total Egypt position to more than 6 million gross acres. This further enhances a highly prospective acreage position and provides a substantial inventory of opportunities for many years to come. |
| North Sea Apache averaged three rigs during the quarter and produced 54,000 BOE per day, which was relatively flat over the first quarter. Two high-rate wells at Callater and Garten are expected to materially increase the North Sea production profile in late 2018 and early 2019. |
APACHE CORPORATION ANNOUNCES SECOND-QUARTER 2018 FINANCIAL AND OPERATIONAL RESULTS
PAGE 4 of 9
Capital investment and financial position
Oil-and-gas capital investment was $833 million during the quarter, including $116 million for Alpine High midstream. Total capital investment for the first half of the year was $1.7 billion. The company anticipates maintaining this pace of investment in the second half of the year, bringing the full-year spending outlook to approximately $3.4 billion, compared to prior guidance of $3 billion. This spend level anticipates a full year of Alpine High midstream investment, which may change with a potential transaction.
The incremental capital is necessary to align and optimize drilling and completion activity in the Midland Basin and to fund investment in longer laterals, larger completions and facility expansions at Alpine High. These activity modifications incorporate learnings from the companys recent strategic tests and are expected to result in increased productivity and improved returns.
At current strip prices, the capital increase will be fully funded through cash flow from operations and will provide significant incremental production in 2019 and beyond.
2018 outlook and guidance update
Strong execution and well performance in the second quarter are prompting the company to raise its 2018 U.S. production guidance for the second time this year. The updated guidance of 260,000 BOE per day is above the high-end of the previous range of 250,000 to 258,000 BOE per day. At Alpine High, full-year 2018 guidance is now 45,000 BOE per day, or the midpoint of the previous guidance range.
APACHE CORPORATION ANNOUNCES SECOND-QUARTER 2018 FINANCIAL AND OPERATIONAL RESULTS
PAGE 5 of 9
Adjusted international production guidance for 2018 is expected to be approximately 134,000 BOE per day, just below the midpoint of the previous range of 130,000 to 140,000 BOE per day. This includes a significant impact of higher-than-planned Brent prices on Egypt net production volumes.
Further details on other financial and operational guidance for the second quarter and full year 2018 can be found in the Second-Quarter 2018 Financial and Operational Supplement at www.apachecorp.com/financialdata.
Apache is executing extremely well on all fronts. We are realizing capital efficiency and productivity improvements that are increasingly evident in our financial and operational results. In the Permian Basin, our drilling and completion operations are very efficient, and our wells are outperforming. Our primary infrastructure is in place at Alpine High, and we are in the very early stages of a significant, long-term production ramp up. Furthermore, we have progressed an Alpine High midstream transaction to advanced stages and anticipate closing before year-end.
Internationally, we are generating significant free cash flow bolstered by Brent oil pricing. Our strategy and investment decisions in these regions are designed to deliver long-term oil growth in Egypt and to sustain production volumes in the North Sea. Our recent discoveries at Callater and Garten in the North Sea and our large-scale, high-density seismic and new acreage concessions in Egypt, give us confidence in our ability to deliver on this strategy while simultaneously maintaining or growing free cash flow.
APACHE CORPORATION ANNOUNCES SECOND-QUARTER 2018 FINANCIAL AND OPERATIONAL RESULTS
PAGE 6 of 9
Given our strong well performance trends, capital efficiency improvements, and the planned increase in 2018 investment, we anticipate upside bias to our 2019 and 2020 production guidance, which we will revisit later this year, Christmann concluded.
Conference call
Apache will host a conference call to discuss its second-quarter 2018 results at 10 a.m. Central time, Thursday, Aug. 2. The conference call will be webcast from Apaches website at www.apachecorp.com and investor.apachecorp.com, and the webcast replay will be archived there as well. A replay of the conference call will be available for seven days following the call. The number for the replay is (855) 859-2056 or (404) 537-3406 for international calls. The conference access code is 3260959. Sign up for email alerts to be reminded of the webcast at investor.apachecorp.com/alerts.cfm.
Additional information
Additional information follows, including reconciliations of adjusted earnings, cash flow from operations before changes in operating assets and liabilities, adjusted EBITDAX, oil and gas capital investment and net debt (non-GAAP financial measures) to GAAP measures and information regarding adjusted production. Apaches quarterly supplement is available at www.apachecorp.com/financialdata.
About Apache
Apache Corporation is an oil and gas exploration and production company with operations in the United States, Egypt and the United Kingdom. Apache posts announcements, operational updates, investor information and copies of all press releases on its website, www.apachecorp.com, and on its Media and Investor Center mobile application, which is available for free download from the Apple App Store and the Googles Play store.
APACHE CORPORATION ANNOUNCES SECOND-QUARTER 2018 FINANCIAL AND OPERATIONAL RESULTS
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Non-GAAP financial measures
Apaches financial information includes information prepared in conformity with generally accepted accounting principles (GAAP) as well as non-GAAP information. It is managements intent to provide non-GAAP financial information to enhance understanding of our consolidated financial information as prepared in accordance with GAAP. Adjusted earnings, cash flow from operations before changes in operating assets and liabilities, oil and gas capital investment, adjusted EBITDAX and net debt are non-GAAP measures. This non-GAAP information should be considered by the reader in addition to, but not instead of, the financial statements prepared in accordance with GAAP. Each non-GAAP financial measure is presented along with the corresponding GAAP measure so as not to imply that more emphasis should be placed on the non-GAAP measure.
Forward-looking statements
This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements can be identified by words such as anticipates, intends, plans, seeks, believes, estimates, expects, guidance, outlook, and similar references to future periods. These statements include, but are not limited to, statements about future plans, expectations and objectives for Apaches operations, including statements about our capital plans, drilling plans, production
APACHE CORPORATION ANNOUNCES SECOND-QUARTER 2018 FINANCIAL AND OPERATIONAL RESULTS
PAGE 8 of 9
expectations, asset sales, and monetizations. While forward-looking statements are based on assumptions and analyses made by us that we believe to be reasonable under the circumstances, whether actual results and developments will meet our expectations and predictions depend on a number of risks and uncertainties which could cause our actual results, performance, and financial condition to differ materially from our expectations. See Risk Factors in our 2017 Form 10-K filed with the Securities and Exchange Commission for a discussion of risk factors that affect our business. Any forward-looking statement made by us in this news release speaks only as of the date on which it is made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future development or otherwise, except as may be required by law.
Cautionary note to investors
The United States Securities and Exchange Commission (SEC) permits oil and gas companies, in their filings with the SEC, to disclose only proved, probable, and possible reserves that meet the SECs definitions for such terms. Apache may use certain terms in this earnings release, such as resources, potential resources, resource potential, estimated net reserves, recoverable reserves, and other similar terms that the SEC guidelines strictly prohibit Apache from including in filings with the SEC. Such terms do not take into account the certainty of resource recovery, which is contingent on exploration success, technical improvements in drilling access, commerciality and other factors, and are therefore
APACHE CORPORATION ANNOUNCES SECOND-QUARTER 2018 FINANCIAL AND OPERATIONAL RESULTS
PAGE 9 of 9
not indicative of expected future resource recovery and should not be relied upon. Investors are urged to consider carefully the disclosure in Apaches Annual Report on Form 10-K for the fiscal year ended Dec. 31, 2017, available from Apache at www.apachecorp.com or by writing Apache at: 2000 Post Oak Blvd., Suite 100, Houston, TX 77056 (Attn: Corporate Secretary). You can also obtain this report from the SEC by calling 1-800-SEC-0330 or from the SECs website at www.sec.gov.
Contacts
Investor: | (281) 302-2286 | Gary Clark | ||
Media: | (713) 296-7276 | Castlen Kennedy | ||
(713) 296-6223 | Phil West |
Website: www.apachecorp.com
-end-
APACHE CORPORATION
STATEMENT OF CONSOLIDATED OPERATIONS
(Unaudited)
(In millions, except per share data)
For the Quarter Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
REVENUES AND OTHER: |
||||||||||||||||
Oil and gas production revenues |
||||||||||||||||
Oil revenues |
$ | 1,576 | $ | 1,050 | $ | 2,969 | $ | 2,222 | ||||||||
Natural gas revenues |
212 | 233 | 434 | 488 | ||||||||||||
Natural gas liquids revenues |
148 | 63 | 266 | 148 | ||||||||||||
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|
|||||||||
1,936 | 1,346 | 3,669 | 2,858 | |||||||||||||
Derivative instrument gain (loss) |
(25 | ) | 41 | (23 | ) | 41 | ||||||||||
Gain (loss) on divestiture |
2 | (21 | ) | 9 | 320 | |||||||||||
Other |
16 | 18 | 21 | 43 | ||||||||||||
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1,929 | 1,384 | 3,676 | 3,262 | |||||||||||||
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OPERATING EXPENSES: |
||||||||||||||||
Lease operating expenses |
356 | 372 | 705 | 708 | ||||||||||||
Gathering, transmission and processing |
82 | 48 | 168 | 105 | ||||||||||||
Taxes other than income |
49 | 29 | 104 | 71 | ||||||||||||
Exploration |
76 | 108 | 152 | 200 | ||||||||||||
General and administrative |
117 | 106 | 231 | 209 | ||||||||||||
Transaction, reorganization and separation |
12 | 4 | 12 | (6 | ) | |||||||||||
Depreciation, depletion and amortization: |
||||||||||||||||
Oil and gas property and equipment |
573 | 536 | 1,091 | 1,074 | ||||||||||||
Other assets |
35 | 36 | 70 | 74 | ||||||||||||
Asset retirement obligation accretion |
27 | 37 | 54 | 73 | ||||||||||||
Impairments |
| | | 8 | ||||||||||||
Financing costs, net |
94 | 99 | 193 | 199 | ||||||||||||
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1,421 | 1,375 | 2,780 | 2,715 | |||||||||||||
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NET INCOME BEFORE INCOME TAXES |
508 | 9 | 896 | 547 | ||||||||||||
Current income tax provision |
249 | 126 | 447 | 314 | ||||||||||||
Deferred income tax provision (benefit) |
(10 | ) | (730 | ) | (26 | ) | (647 | ) | ||||||||
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INCOME INCLUDING NONCONTROLLING INTEREST |
269 | 613 | 475 | 880 | ||||||||||||
Net income attributable to noncontrolling interest |
74 | 41 | 135 | 95 | ||||||||||||
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NET INCOME ATTRIBUTABLE TO COMMON STOCK |
$ | 195 | $ | 572 | $ | 340 | $ | 785 | ||||||||
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NET INCOME PER COMMON SHARE: |
||||||||||||||||
Basic |
$ | 0.51 | $ | 1.50 | $ | 0.89 | $ | 2.06 | ||||||||
Diluted |
$ | 0.51 | $ | 1.50 | $ | 0.88 | $ | 2.05 | ||||||||
WEIGHTED-AVERAGE NUMBER OF COMMON SHARES OUTSTANDING: |
||||||||||||||||
Basic |
382 | 381 | 382 | 380 | ||||||||||||
Diluted |
385 | 383 | 384 | 383 | ||||||||||||
DIVIDENDS DECLARED PER COMMON SHARE |
$ | 0.25 | $ | 0.25 | $ | 0.50 | $ | 0.50 |
Page 1
APACHE CORPORATION
PRODUCTION INFORMATION
For the Quarter Ended | % Change | For the Six Months Ended | ||||||||||||||||||||||||||
June 30, 2018 |
March 31, 2018 |
June 30, 2017 |
2Q18 to 1Q18 |
2Q18 to 2Q17 |
June 30, 2018 |
June 30, 2017 |
||||||||||||||||||||||
OIL VOLUMEBarrels per day |
||||||||||||||||||||||||||||
Permian |
89,928 | 85,469 | 71,891 | 5 | % | 25 | % | 87,711 | 73,541 | |||||||||||||||||||
MidContinent/Gulf Coast |
11,492 | 10,494 | 10,197 | 10 | % | 13 | % | 10,996 | 10,667 | |||||||||||||||||||
Gulf of Mexico |
3,743 | 3,784 | 3,983 | -1 | % | -6 | % | 3,763 | 4,178 | |||||||||||||||||||
Canada |
| | 11,638 | | NM | | 11,647 | |||||||||||||||||||||
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North America |
105,163 | 99,747 | 97,709 | 5 | % | 8 | % | 102,470 | 100,033 | |||||||||||||||||||
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Egypt (1, 2) |
96,185 | 95,270 | 96,961 | 1 | % | -1 | % | 95,730 | 99,327 | |||||||||||||||||||
North Sea |
46,150 | 46,348 | 48,091 | 0 | % | -4 | % | 46,249 | 48,933 | |||||||||||||||||||
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International (1) |
142,335 | 141,618 | 145,052 | 1 | % | -2 | % | 141,979 | 148,260 | |||||||||||||||||||
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Total (1) |
247,498 | 241,365 | 242,761 | 3 | % | 2 | % | 244,449 | 248,293 | |||||||||||||||||||
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NATURAL GAS VOLUMEMcf per day |
||||||||||||||||||||||||||||
Permian |
403,267 | 357,311 | 237,455 | 13 | % | 70 | % | 380,416 | 232,582 | |||||||||||||||||||
MidContinent/Gulf Coast |
135,629 | 121,046 | 114,534 | 12 | % | 18 | % | 128,378 | 118,993 | |||||||||||||||||||
Gulf of Mexico |
8,881 | 10,187 | 12,063 | -13 | % | -26 | % | 9,530 | 13,906 | |||||||||||||||||||
Canada |
| | 205,408 | | NM | | 210,484 | |||||||||||||||||||||
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North America |
547,777 | 488,544 | 569,460 | 12 | % | -4 | % | 518,324 | 575,965 | |||||||||||||||||||
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Egypt (1, 2) |
340,991 | 343,901 | 383,296 | -1 | % | -11 | % | 342,438 | 395,179 | |||||||||||||||||||
North Sea |
43,297 | 41,039 | 34,348 | 6 | % | 26 | % | 42,174 | 39,111 | |||||||||||||||||||
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International (1) |
384,288 | 384,940 | 417,644 | 0 | % | -8 | % | 384,612 | 434,290 | |||||||||||||||||||
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Total (1) |
932,065 | 873,484 | 987,104 | 7 | % | -6 | % | 902,936 | 1,010,255 | |||||||||||||||||||
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NGL VOLUMEBarrels per day |
||||||||||||||||||||||||||||
Permian |
44,693 | 37,950 | 34,067 | 18 | % | 31 | % | 41,341 | 34,223 | |||||||||||||||||||
MidContinent/Gulf Coast |
14,050 | 13,072 | 12,636 | 7 | % | 11 | % | 13,563 | 12,909 | |||||||||||||||||||
Gulf of Mexico |
293 | 262 | 326 | 12 | % | -10 | % | 278 | 379 | |||||||||||||||||||
Canada |
| | 4,365 | | NM | | 4,592 | |||||||||||||||||||||
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North America |
59,036 | 51,284 | 51,394 | 15 | % | 15 | % | 55,182 | 52,103 | |||||||||||||||||||
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Egypt (1, 2) |
1,127 | 937 | 880 | 20 | % | 28 | % | 1,033 | 917 | |||||||||||||||||||
North Sea |
1,104 | 1,168 | 741 | -5 | % | 49 | % | 1,135 | 955 | |||||||||||||||||||
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International (1) |
2,231 | 2,105 | 1,621 | 6 | % | 38 | % | 2,168 | 1,872 | |||||||||||||||||||
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Total |
61,267 | 53,389 | 53,015 | 15 | % | 16 | % | 57,350 | 53,975 | |||||||||||||||||||
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BOE per day |
||||||||||||||||||||||||||||
Permian |
201,832 | 182,972 | 145,533 | 10 | % | 39 | % | 192,455 | 146,528 | |||||||||||||||||||
MidContinent/Gulf Coast |
48,147 | 43,740 | 41,923 | 10 | % | 15 | % | 45,955 | 43,408 | |||||||||||||||||||
Gulf of Mexico |
5,516 | 5,744 | 6,319 | -4 | % | -13 | % | 5,629 | 6,875 | |||||||||||||||||||
Canada |
| | 50,238 | | NM | | 51,319 | |||||||||||||||||||||
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North America |
255,495 | 232,456 | 244,013 | 10 | % | 5 | % | 244,039 | 248,130 | |||||||||||||||||||
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Egypt (1, 2) |
154,144 | 153,524 | 161,724 | 0 | % | -5 | % | 153,836 | 166,107 | |||||||||||||||||||
North Sea |
54,470 | 54,356 | 54,556 | 0 | % | 0 | % | 54,413 | 56,407 | |||||||||||||||||||
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International (1) |
208,614 | 207,880 | 216,280 | 0 | % | -4 | % | 208,249 | 222,514 | |||||||||||||||||||
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Total (1) |
464,109 | 440,336 | 460,293 | 5 | % | 1 | % | 452,288 | 470,644 | |||||||||||||||||||
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Total excluding noncontrolling interests |
412,693 | 389,098 | 405,989 | 6 | % | 2 | % | 400,960 | 415,073 | |||||||||||||||||||
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(1) Includes net production volumes attributed to our noncontrolling partner in Egypt below: |
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Oil (b/d) |
32,066 | 31,774 | 32,562 | 31,921 | 33,232 | |||||||||||||||||||||||
Gas (Mcf/d) |
113,846 | 114,913 | 128,696 | 114,377 | 132,197 | |||||||||||||||||||||||
NGL (b/d) |
376 | 312 | 293 | 344 | 306 | |||||||||||||||||||||||
(2) Egypt Gross ProductionBOE per day |
341,636 | 330,063 | 334,496 | 4 | % | 2 | % | 335,882 | 331,336 |
Page 2
APACHE CORPORATION
ADJUSTED PRODUCTION INFORMATION
Adjusted production excludes certain items that management believes affect the comparability of operating results for the periods presented. Adjusted production excludes production attributable to 1) divested assets, 2) noncontrolling interest in Egypt, and 3) Egypt tax barrels. Management uses adjusted production to evaluate the companys operational trends and performance and believes it is useful to investors and other third parties.
For the Quarter Ended | % Change | For the Six Months Ended | ||||||||||||||||||||||||||
June 30, 2018 |
March 31, 2018 |
June 30, 2017 |
2Q18 to 1Q18 |
2Q18 to 2Q17 |
June 30, 2018 |
June 30, 2017 |
||||||||||||||||||||||
OIL VOLUMEBarrels per day |
||||||||||||||||||||||||||||
Permian |
89,928 | 85,469 | 71,891 | 5 | % | 25 | % | 87,711 | 73,320 | |||||||||||||||||||
MidContinent/Gulf Coast |
11,492 | 10,494 | 10,197 | 10 | % | 13 | % | 10,996 | 10,667 | |||||||||||||||||||
Gulf of Mexico |
3,743 | 3,784 | 3,983 | -1 | % | -6 | % | 3,763 | 4,178 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
North America |
105,163 | 99,747 | 86,071 | 5 | % | 22 | % | 102,470 | 88,165 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Egypt |
47,837 | 47,993 | 51,776 | 0 | % | -8 | % | 47,915 | 51,714 | |||||||||||||||||||
North Sea |
46,151 | 46,348 | 48,091 | 0 | % | -4 | % | 46,249 | 48,933 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
International |
93,988 | 94,341 | 99,867 | 0 | % | -6 | % | 94,164 | 100,647 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total |
199,151 | 194,088 | 185,938 | 3 | % | 7 | % | 196,634 | 188,812 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
NATURAL GAS VOLUMEMcf per day |
||||||||||||||||||||||||||||
Permian |
403,267 | 357,311 | 237,455 | 13 | % | 70 | % | 380,416 | 231,592 | |||||||||||||||||||
MidContinent/Gulf Coast |
135,629 | 121,046 | 114,534 | 12 | % | 18 | % | 128,378 | 118,993 | |||||||||||||||||||
Gulf of Mexico |
8,881 | 10,187 | 12,063 | -13 | % | -26 | % | 9,530 | 13,906 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
North America |
547,777 | 488,544 | 364,052 | 12 | % | 50 | % | 518,324 | 364,491 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Egypt |
188,012 | 189,982 | 220,061 | -1 | % | -15 | % | 188,991 | 218,605 | |||||||||||||||||||
North Sea |
43,296 | 41,039 | 34,348 | 5 | % | 26 | % | 42,174 | 39,111 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
International |
231,308 | 231,021 | 254,409 | 0 | % | -9 | % | 231,165 | 257,716 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total |
779,085 | 719,565 | 618,461 | 8 | % | 26 | % | 749,489 | 622,207 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
NGL VOLUMEBarrels per day |
||||||||||||||||||||||||||||
Permian |
44,693 | 37,950 | 34,067 | 18 | % | 31 | % | 41,341 | 34,069 | |||||||||||||||||||
MidContinent/Gulf Coast |
14,050 | 13,072 | 12,636 | 7 | % | 11 | % | 13,563 | 12,909 | |||||||||||||||||||
Gulf of Mexico |
293 | 262 | 326 | 12 | % | -10 | % | 278 | 379 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
North America |
59,036 | 51,284 | 47,029 | 15 | % | 26 | % | 55,182 | 47,357 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Egypt |
596 | 495 | 540 | 20 | % | 10 | % | 546 | 526 | |||||||||||||||||||
North Sea |
1,104 | 1,168 | 741 | -5 | % | 49 | % | 1,135 | 955 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
International |
1,700 | 1,663 | 1,281 | 2 | % | 33 | % | 1,681 | 1,481 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total |
60,736 | 52,947 | 48,310 | 15 | % | 26 | % | 56,863 | 48,838 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
BOE per day |
||||||||||||||||||||||||||||
Permian |
201,832 | 182,972 | 145,533 | 10 | % | 39 | % | 192,455 | 145,988 | |||||||||||||||||||
MidContinent/Gulf Coast |
48,147 | 43,740 | 41,923 | 10 | % | 15 | % | 45,955 | 43,408 | |||||||||||||||||||
Gulf of Mexico |
5,516 | 5,744 | 6,319 | -4 | % | -13 | % | 5,629 | 6,875 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
North America |
255,495 | 232,456 | 193,775 | 10 | % | 32 | % | 244,039 | 196,271 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Egypt |
79,769 | 80,153 | 88,993 | 0 | % | -10 | % | 79,960 | 88,674 | |||||||||||||||||||
North Sea |
54,470 | 54,356 | 54,556 | 0 | % | 0 | % | 54,413 | 56,407 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
International |
134,239 | 134,509 | 143,549 | 0 | % | -6 | % | 134,373 | 145,081 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total |
389,734 | 366,965 | 337,324 | 6 | % | 16 | % | 378,412 | 341,352 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
Page 3
APACHE CORPORATION
PRICE INFORMATION
For the Quarter Ended | For the Six Months Ended | |||||||||||||||||||
June 30, 2018 |
March 31, 2018 |
June 30, 2017 |
June 30, 2018 |
June 30, 2017 |
||||||||||||||||
AVERAGE OIL PRICE PER BARREL |
||||||||||||||||||||
Permian |
$ | 62.69 | $ | 61.50 | $ | 45.09 | $ | 62.12 | $ | 47.16 | ||||||||||
MidContinent/Gulf Coast |
65.98 | 62.18 | 46.19 | 64.18 | 47.78 | |||||||||||||||
Gulf of Mexico |
67.76 | 69.24 | 45.85 | 68.50 | 47.56 | |||||||||||||||
Canada |
| | 44.52 | | 45.70 | |||||||||||||||
North America |
63.27 | 61.76 | 45.10 | 62.54 | 46.84 | |||||||||||||||
Egypt |
74.14 | 66.30 | 47.98 | 70.26 | 50.57 | |||||||||||||||
North Sea |
73.05 | 65.87 | 48.21 | 69.58 | 50.51 | |||||||||||||||
International |
73.78 | 66.16 | 48.06 | 70.04 | 50.55 | |||||||||||||||
Total |
69.35 | 64.34 | 46.89 | 66.90 | 49.06 | |||||||||||||||
AVERAGE NATURAL GAS PRICE PER MCF |
||||||||||||||||||||
Permian |
$ | 1.85 | $ | 2.40 | $ | 2.50 | $ | 2.11 | $ | 2.53 | ||||||||||
MidContinent/Gulf Coast |
2.21 | 2.68 | 2.88 | 2.43 | 3.01 | |||||||||||||||
Gulf of Mexico |
2.95 | 3.64 | 3.03 | 3.32 | 3.07 | |||||||||||||||
Canada |
| | 2.14 | | 2.24 | |||||||||||||||
North America |
1.94 | 2.49 | 2.39 | 2.20 | 2.44 | |||||||||||||||
Egypt |
2.85 | 2.85 | 2.73 | 2.85 | 2.75 | |||||||||||||||
North Sea |
6.82 | 6.60 | 4.54 | 6.71 | 5.27 | |||||||||||||||
International |
3.29 | 3.25 | 2.88 | 3.27 | 2.98 | |||||||||||||||
Total |
2.50 | 2.82 | 2.60 | 2.65 | 2.67 | |||||||||||||||
AVERAGE NGL PRICE PER BARREL |
||||||||||||||||||||
Permian |
$ | 26.97 | $ | 24.64 | $ | 13.08 | $ | 25.90 | $ | 14.81 | ||||||||||
MidContinent/Gulf Coast |
22.90 | 22.13 | 10.03 | 22.53 | 12.52 | |||||||||||||||
Gulf of Mexico |
32.52 | 30.39 | 13.10 | 31.52 | 18.02 | |||||||||||||||
Canada |
| | 15.99 | | 16.53 | |||||||||||||||
North America |
26.03 | 24.02 | 12.58 | 25.10 | 14.42 | |||||||||||||||
Egypt |
40.80 | 36.19 | 31.11 | 38.72 | 35.74 | |||||||||||||||
North Sea |
44.71 | 42.82 | 22.92 | 43.75 | 32.85 | |||||||||||||||
International |
42.73 | 39.87 | 27.37 | 41.35 | 34.26 | |||||||||||||||
Total |
26.64 | 24.65 | 13.03 | 25.72 | 15.10 |
Page 4
APACHE CORPORATION
SUPPLEMENTAL FINANCIAL INFORMATION
(Unaudited)
(In millions)
SUMMARY OF DERIVATIVE INSTRUMENT GAINS (LOSSES), NET
For the Quarter Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Derivative settlementsrealized loss |
$ | (75 | ) | $ | | $ | (117 | ) | $ | | ||||||
Amortization of call and put premium |
(5 | ) | | (10 | ) | | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Realized loss |
(80 | ) | | (127 | ) | | ||||||||||
Unrealized mark-to-market gain |
55 | 41 | 104 | 41 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
$ | (25 | ) | $ | 41 | $ | (23 | ) | $ | 41 | |||||||
|
|
|
|
|
|
|
|
SUMMARY EXPLORATION EXPENSE INFORMATION
For the Quarter Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Unproved leasehold impairments |
$ | 21 | $ | 39 | $ | 37 | $ | 54 | ||||||||
Dry hole expense |
16 | 46 | 36 | 98 | ||||||||||||
Geological and geophysical expense |
17 | 6 | 35 | 12 | ||||||||||||
Exploration overhead and other |
22 | 17 | 44 | 36 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
$ | 76 | $ | 108 | $ | 152 | $ | 200 | |||||||||
|
|
|
|
|
|
|
|
SUMMARY CASH FLOW INFORMATION
For the Quarter Ended June 30, |
For the Six Months Ended June 30, |
|||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Net cash provided by operating activities |
1,113 | 751 | 1,728 | 1,206 | ||||||||||||
Net cash used in investing activities |
(1,024 | ) | (436 | ) | (1,914 | ) | (529 | ) | ||||||||
Net cash used in financing activities |
(194 | ) | (169 | ) | (510 | ) | (387 | ) |
SUMMARY BALANCE SHEET INFORMATION
June 30, 2018 |
December 31, 2017 |
|||||||
Cash and cash equivalents |
$ | 972 | $ | 1,668 | ||||
Other current assets |
2,167 | 2,057 | ||||||
Property and equipment, net |
18,336 | 17,759 | ||||||
Other assets |
435 | 438 | ||||||
|
|
|
|
|||||
Total assets |
$ | 21,910 | $ | 21,922 | ||||
|
|
|
|
|||||
Current debt |
$ | 400 | $ | 550 | ||||
Current liabilities |
1,912 | 2,014 | ||||||
Long-term debt |
7,937 | 7,934 | ||||||
Deferred credits and other noncurrent liabilities |
2,666 | 2,633 | ||||||
Apache shareholders equity |
7,640 | 7,416 | ||||||
Noncontrolling interest |
1,355 | 1,375 | ||||||
|
|
|
|
|||||
Total Liabilities and shareholders equity |
$ | 21,910 | $ | 21,922 | ||||
|
|
|
|
|||||
Common shares outstanding at end of period |
382 | 381 |
Page 5
APACHE CORPORATION
NON-GAAP FINANCIAL MEASURES
(In millions, except per share data)
Reconciliation of net cash provided by operating activities to adjusted EBITDAX
Management believes EBITDAX, or earnings before income tax expense, interest expense, depreciation, amortization and exploration expense is a widely accepted financial indicator, and useful for investors, to assess a companys ability to incur and service debt, fund capital expenditures, and make distributions to shareholders. We define adjusted EBITDAX, a non-GAAP financial measure, as EBITDAX adjusted for certain items presented in the accompanying reconciliation. Management uses adjusted EBITDAX to evaluate our ability to fund our capital expenditures, debt services and other operational requirements and to compare our results from period to period by eliminating the impact of certain items that management does not consider to be representative of the Companys on-going operations. Management also believes adjusted EBITDAX facilitates investors and analysts in evaluating and comparing EBITDAX from period to period by eliminating differences caused by the existence and timing of certain operating expenses that would not otherwise be apparent on a GAAP basis. However, our presentation of adjusted EBITDAX may not be comparable to similar measures of other companies in our industry.
For the Quarter Ended | For the Six Months Ended | |||||||||||||||||||
June 30, | March 31, | June 30, | June 30, | |||||||||||||||||
2018 | 2018 | 2017 | 2018 | 2017 | ||||||||||||||||
Net cash provided by operating activities |
$ | 1,113 | $ | 615 | $ | 751 | $ | 1,728 | $ | 1,206 | ||||||||||
Adjustments: |
||||||||||||||||||||
Exploration expense other than dry hole expense and unproved leasehold impairments |
39 | 40 | 23 | 79 | 48 | |||||||||||||||
Current income tax provision |
249 | 198 | 126 | 447 | 314 | |||||||||||||||
Other adjustments to reconcile net loss to net cash provided by operating activities |
(58 | ) | (49 | ) | (46 | ) | (107 | ) | (80 | ) | ||||||||||
Changes in operating assets and liabilities |
(181 | ) | 184 | (148 | ) | 3 | 127 | |||||||||||||
Financing costs, net |
94 | 99 | 99 | 193 | 199 | |||||||||||||||
Transaction, reorganization & separation costs |
12 | | 4 | 12 | (6 | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Adjusted EBITDAX (Non-GAAP) |
$ | 1,268 | $ | 1,087 | $ | 809 | $ | 2,355 | $ | 1,808 | ||||||||||
|
|
|
|
|
|
|
|
|
|
Reconciliation of income attributable to common stock to adjusted earnings
Our presentation of adjusted earnings and adjusted earnings per share are non-GAAP measures because they exclude the effect of certain items included in Income Attributable to Common Stock. Management believes that adjusted earnings and adjusted earnings per share provides relevant and useful information, which is widely used by analysts, investors and competitors in our industry as well as by our management in assessing the Companys operational trends and comparability of results to our peers.
Management uses adjusted earnings and adjusted earnings per share to evaluate our operating and financial performance because it eliminates the impact of certain items that management does not consider to be representative of the Companys on-going business operations. As a performance measure, adjusted earnings may be useful to investors in facilitating comparisons to others in the Companys industry because certain items can vary substantially in the oil and gas industry from company to company depending upon accounting methods, book value of assets, capital structure and asset sales and other divestitures, among other factors. Management believes excluding these items facilitates investors and analysts in evaluating and comparing the underlying operating and financial performance of our business from period to period by eliminating differences caused by the existence and timing of certain expense and income items that would not otherwise be apparent on a GAAP basis. However, our presentation of adjusted earnings and adjusted earnings per share may not be comparable to similar measures of other companies in our industry.
For the Quarter Ended June 30, 2018 |
For the Quarter Ended June 30, 2017 |
|||||||||||||||||||||||||||||||
Before Tax |
Tax Impact |
After Tax |
Diluted EPS |
Before Tax |
Tax Impact |
After Tax |
Diluted EPS |
|||||||||||||||||||||||||
Income including noncontrolling interest (GAAP) |
$ | 508 | $ | (239 | ) | $ | 269 | $ | 0.70 | $ | 9 | $ | 604 | $ | 613 | $ | 1.60 | |||||||||||||||
Income attributable to noncontrolling interest |
134 | (60 | ) | 74 | 0.19 | 75 | (34 | ) | 41 | 0.10 | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Net income attributable to common stock |
374 | (179 | ) | 195 | 0.51 | (66 | ) | 638 | 572 | 1.50 | ||||||||||||||||||||||
Adjustments:* |
||||||||||||||||||||||||||||||||
Unrealized derivative instrument gain |
(55 | ) | 12 | (43 | ) | (0.11 | ) | (41 | ) | 15 | (26 | ) | (0.07 | ) | ||||||||||||||||||
(Gain) / loss on divestitures |
(2 | ) | | (2 | ) | (0.01 | ) | 21 | (3 | ) | 18 | 0.05 | ||||||||||||||||||||
Asset impairments |
21 | (4 | ) | 17 | 0.05 | 39 | (14 | ) | 25 | 0.07 | ||||||||||||||||||||||
Modification of stock comp plans |
14 | (3 | ) | 11 | 0.03 | | | | | |||||||||||||||||||||||
Valuation allowance and other tax adjustments |
| 5 | 5 | 0.01 | | (670 | ) | (670 | ) | (1.77 | ) | |||||||||||||||||||||
Transaction, reorganization & separation costs |
12 | (3 | ) | 9 | 0.02 | 4 | (2 | ) | 2 | 0.01 | ||||||||||||||||||||||
Loss on extinguishment of debt |
| | | | | | | | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Adjusted earnings (Non-GAAP) |
$ | 364 | $ | (172 | ) | $ | 192 | $ | 0.50 | $ | (43 | ) | $ | (36 | ) | $ | (79 | ) | $ | (0.21 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Six Months Ended June 30, 2018 |
For the Six Months Ended June 30, 2017 |
|||||||||||||||||||||||||||||||
Before Tax |
Tax Impact |
After Tax |
Diluted EPS |
Before Tax |
Tax Impact |
After Tax |
Diluted EPS |
|||||||||||||||||||||||||
Income including noncontrolling interest (GAAP) |
$ | 896 | $ | (421 | ) | $ | 475 | $ | 1.23 | $ | 547 | $ | 333 | $ | 880 | $ | 2.30 | |||||||||||||||
Income attributable to noncontrolling interest |
246 | (111 | ) | 135 | 0.35 | 175 | (80 | ) | 95 | 0.25 | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Net income attributable to common stock |
650 | (310 | ) | 340 | 0.88 | 372 | 413 | 785 | 2.05 | |||||||||||||||||||||||
Adjustments:* |
||||||||||||||||||||||||||||||||
Unrealized derivative instrument gain |
(104 | ) | 22 | (82 | ) | (0.21 | ) | (41 | ) | 15 | (26 | ) | (0.07 | ) | ||||||||||||||||||
(Gain) / loss on divestitures |
(9 | ) | 1 | (8 | ) | (0.02 | ) | (320 | ) | 116 | (204 | ) | (0.53 | ) | ||||||||||||||||||
Asset impairments |
37 | (7 | ) | 30 | 0.08 | 62 | (22 | ) | 40 | 0.11 | ||||||||||||||||||||||
Modification of stock comp plans |
28 | (7 | ) | 21 | 0.05 | | | | | |||||||||||||||||||||||
Valuation allowance and other tax adjustments |
| 6 | 6 | 0.02 | | (639 | ) | (639 | ) | (1.68 | ) | |||||||||||||||||||||
Transaction, reorganization & separation costs |
12 | (3 | ) | 9 | 0.02 | (6 | ) | 1 | (5 | ) | (0.01 | ) | ||||||||||||||||||||
Loss on extinguishment of debt |
| | | | 1 | | 1 | | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Adjusted Earnings (Non-GAAP) |
$ | 614 | $ | (298 | ) | $ | 316 | $ | 0.82 | $ | 68 | $ | (116 | ) | $ | (48 | ) | $ | (0.13 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* | The income tax effect of the reconciling items are calculated based on the statutory rate of the jurisdiction in which the discrete item resides. |
Page 6
APACHE CORPORATION
NON-GAAP FINANCIAL MEASURES
(In millions)
Reconciliation of Debt to Net debt
Net debt, or outstanding debt obligations less cash and cash equivalents, is a non-GAAP financial measure. Management uses net debt as a measure of the Companys outstanding debt obligations that would not be readily satisfied by its cash and cash equivalents on hand.
June 30, 2018 |
March 31, 2018 |
December 31, 2017 |
September 30, 2017 |
June 30, 2017 |
||||||||||||||||
Current debt |
$ | 400 | $ | 400 | $ | 550 | $ | 550 | $ | 150 | ||||||||||
Long-term debt |
7,937 | 7,936 | 7,934 | 7,933 | 8,329 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total debt |
8,337 | 8,336 | 8,484 | 8,483 | 8,479 | |||||||||||||||
Cash and cash equivalents |
972 | 1,077 | 1,668 | 1,846 | 1,667 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net debt |
$ | 7,365 | $ | 7,259 | $ | 6,816 | $ | 6,637 | $ | 6,812 | ||||||||||
|
|
|
|
|
|
|
|
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Reconciliation of Costs incurred and GTP capital investments to Oil and gas capital investment
Management believes the presentation of oil and gas capital investments is useful for investors to assess Apaches expenditures related to our oil and gas capital activity. We define oil and gas capital investments as costs incurred for oil and gas activities and GTP activities, adjusted to exclude asset retirement obligations revisions and liabilities incurred, while including amounts paid during the period for abandonment and decommissioning expenditures. Capital expenditures attributable to a one-third noncontrolling interest in Egypt are also excluded. Management believes this provides a more accurate reflection of Apaches cash expenditures related to oil and gas capital activity and is consistent with how we plan our capital budget.
For the Quarter Ended June 30, |
For the Six Months Ended June 30, |
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2018 | 2017 | 2018 | 2017 | |||||||||||||
Costs incurred in oil and gas property: |
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Acquisitions |
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Proved |
$ | | $ | 3 | $ | | $ | 3 | ||||||||
Unproved |
26 | 15 | 38 | 64 | ||||||||||||
Exploration and development |
772 | 733 | 1,589 | 1,246 | ||||||||||||
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798 | 751 | 1,627 | 1,313 | |||||||||||||
GTP capital investments: |
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GTP facilities |
124 | 146 | 243 | 288 | ||||||||||||
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Total Costs incurred and GTP capital investments |
$ | 922 | $ | 897 | $ | 1,870 | $ | 1,601 | ||||||||
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Reconciliation of Costs incurred and GTP to Oil and gas capital investment |
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Asset retirement obligations incurred and revisionsoil and gas property |
$ | (4 | ) | $ | (90 | ) | $ | (6 | ) | $ | (105 | ) | ||||
Asset retirement obligations incurred and revisionsGTP facilities |
(7 | ) | (14 | ) | (12 | ) | (14 | ) | ||||||||
Asset retirement obligations settled |
16 | 9 | 24 | 22 | ||||||||||||
Exploration expense other than dry hole expense and unproved leasehold impairments |
(39 | ) | (23 | ) | (79 | ) | (48 | ) | ||||||||
Less noncontrolling interest |
(55 | ) | (41 | ) | (107 | ) | (72 | ) | ||||||||
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Oil and gas capital investment |
$ | 833 | $ | 738 | $ | 1,690 | $ | 1,384 | ||||||||
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Reconciliation of net cash provided by operating activities to cash flows from operations before changes in operating assets and liabilities
Cash flows from operations before changes in operating assets and liabilities is a non-GAAP financial measure. Apache uses it internally and provides the information because management believes it is useful for investors and widely accepted by those following the oil and gas industry as a financial indicator of a companys ability to generate cash to internally fund exploration and development activities, fund dividend programs, and service debt. It is also used by research analysts to value and compare oil and gas exploration and production companies and is frequently included in published research when providing investment recommendations. Cash flows from operations before changes in operating assets and liabilities, therefore, is an additional measure of liquidity but is not a measure of financial performance under GAAP and should not be considered as an alternative to cash flows from operating, investing, or financing activities.
For the Quarter Ended | For the Six Months Ended | |||||||||||||||||||
June 30, | March 31, | June 30, | June 30, | |||||||||||||||||
2018 | 2018 | 2017 | 2018 | 2017 | ||||||||||||||||
Net cash provided by operating activities |
$ | 1,113 | $ | 615 | $ | 751 | $ | 1,728 | $ | 1,206 | ||||||||||
Changes in operating assets and liabilities |
(181 | ) | 184 | (148 | ) | 3 | 127 | |||||||||||||
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Cash flows from operations before changes in operating assets and liabilities |
$ | 932 | $ | 799 | $ | 603 | $ | 1,731 | $ | 1,333 | ||||||||||
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Page 7
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