EX-99.2 3 mur-20150202ex992add104.htm EX-99.2 Exhibit 992 Malaysia Sale 2

Exhibit 99.2

 

 

Murphy Oil Corporation

Unaudited Pro Forma Consolidated Financial Statements

 

On January 29, 2015, a subsidiary of Murphy Oil Corporation (Murphy) completed the sale of 10% of its Malaysian oil and gas assets to PT Pertamina Malaysia Eksplorasi Produksi, a wholly-owned subsidiary of PT Pertamina (collectively “Pertamina”).  Murphy had previously sold 20% of its Malaysian assets to Pertamina on December 18, 2014.

 

The unaudited pro forma consolidated financial statements of Murphy presented in this Exhibit were derived from our historical consolidated financial statements and are being presented to give effect to this sale of assets to Pertamina.  The unaudited pro forma condensed consolidated balance sheet assumes the combined 30% sale to Pertamina occurred on September 30, 2014.  The unaudited pro forma condensed consolidated statements of income are presented as if the sale of a combined 30% of Malaysian assets to Pertamina occurred on January 1, 2013.  The following unaudited pro forma condensed consolidated financial statements should be read in conjunction with our historical financial statements and accompanying notes.

 

The pro forma adjustments are based on available information and assumptions management believes are factually supportable and for income statement purposes are recurring in nature.  The pro forma adjustments to reflect the sale of Malaysia assets to Pertamina include:

 

 

 

–

the associated assets, liabilities, revenue and expenses associated with assets sold to Pertamina

–

collection of anticipated cash proceeds in the unaudited pro forma condensed consolidated balance sheet as if the combined 30% sale had occurred on September 30, 2014, net of transaction fees

–

the costs of effecting the sale of assets to Pertamina that are factually supportable, primarily legal and advisor fees

 

The unaudited pro forma condensed consolidated financial statements are for illustrative purposes only, and do not reflect what our financial position and results of operations would have been had the separation occurred on the dates indicated and these statements are not indicative of our future financial position and future results of operations.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ex. 99.2-1

 

 

 

Murphy Oil Corporation

Unaudited Pro Forma Consolidated Balance Sheet

September 30, 2014

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Historical

 

Pro forma adjustments

 

 

Pro forma

Assets

 

 

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

 

 

    Cash and cash equivalents

 

$
674,021 

 
1,864,803 

(a)

 
2,538,824 

    Canadian government securities with maturities greater
        than 90 days at the date of acquisition

 

 
460,190 

 

 

 

 
460,190 

    Accounts receivable, less allowance for doubtful accounts
      of $1,609

 

 
970,286 

 

 

 

 
970,286 

    Inventories, at lower of cost or market

 

 

 

 

 

 

 

 

        Crude oil

 

 
40,311 

 
(4,886)

(b)

 
35,425 

        Materials and supplies

 

 
259,644 

 
(52,560)

(b)

 
207,084 

    Prepaid expenses

 

 
86,091 

 
(1,857)

(b)

 
84,234 

    Deferred income taxes

 

 
60,700 

 

 

 

 
60,700 

    Assets held for sale

 

 
735,875 

 

 

 

 
735,875 

                    Total current assets

 

 
3,287,118 

 
1,805,500 

 

 
5,092,618 

Property, plant and equipment, at cost less accumulated 
    depreciation, depletion and amortization of $9,698,266

 

 
14,372,837 

 
(1,689,231)

(b)

 
12,683,606 

Goodwill

 

 
38,198 

 

 

 

 
38,198 

Deferred charges and other assets

 

 
87,106 

 

 

 

 
87,106 

Assets held for sale

 

 
60,507 

 

 

 

 
60,507 

                    Total assets

 

$
17,845,766 

 
116,269 

 

 
17,962,035 

 

 

 

 

 

 

 

 

 

Liabilities and Stockholders' Equity

 

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

 

    Current maturities of long-term debt

 

$
39,607 

 
(11,882)

(b)

 
27,725 

    Accounts payable

 

 
2,249,579 

 

 

 

 
2,249,579 

    Income taxes payable

 

 
145,185 

 

 

 

 
145,185 

    Liabilities associated with assets held for sale

 

 
185,846 

 

 

 

 
185,846 

                    Total current liabilities

 

 
2,620,217 

 
(11,882)

 

 
2,608,335 

 

 

 

 

 

 

 

 

 

Long-term debt, including capital lease obligation

 

 
3,986,261 

 
(102,400)

(b)

 
3,883,861 

Deferred income taxes

 

 
1,519,677 

 
(257,809)

(b)

 
1,261,868 

Asset retirement obligations

 

 
897,765 

 
(77,004)

(b)

 
820,761 

Deferred credits and other liabilities

 

 
344,301 

 

 

 

 
344,301 

Liabilities associated with assets held for sale

 

 
75,037 

 

 

 

 
75,037 

 

 

 

 

 

 

 

 

 

Stockholders’ equity

 

 

 

 

 

 

 

 

    Cumulative Preferred Stock, par $100, authorized
      400,000 shares, none issued

 

 

– 

 

 

 

 

– 

    Common Stock, par $1.00, authorized 450,000,000
      shares, issued 195,036,689 shares

 

 
195,037 

 

 

 

 
195,037 

    Capital in excess of par value

 

 
896,567 

 

 

 

 
896,567 

    Retained earnings

 

 
8,414,917 

 
565,364 

(c)

 
8,980,281 

    Accumulated other comprehensive income

 

 
(17,809)

 

 

 

 
(17,809)

    Treasury Stock, 17,541,917 shares of Common Stock,
      at cost

 

 
(1,086,204)

 

 

 

 
(1,086,204)

                    Total stockholders’ equity

 

 
8,402,508 

 
565,364 

 

 
8,967,872 

                    Total liabilities and stockholders’ equity

 

$
17,845,766 

 
116,269 

 

 
17,962,035 

 

 

 

 

 

 

Ex. 99.2-2

 

 

Murphy Oil Corporation

Unaudited Pro Forma Consolidated Statement of Income

Nine Months Ended September 30, 2014

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Historical

 

Pro forma adjustments

 

 

Pro forma

 

Revenues

 

 

 

 

 

 

 

 

Sales and other operating revenues

$
4,070,120 

 
(477,803)

 (d)

 
3,592,317 

 

Loss on sale of assets

 
(5,130)

 
(14)

 (d)

 
(5,144)

 

Interest and other income

 
3,468 

 
(908)

 (d)

 
2,560 

 

           Total revenues

 
4,068,458 

 
(478,725)

 

 
3,589,733 

 

 

 

 

 

 

 

 

 

 

Costs and Expenses

 

 

 

 

 

 

 

 

Operating expenses

 
813,638 

 
(80,495)

 (d)

 
733,143 

 

Severance and ad valorem taxes

 
83,793 

 

 

 

 
83,793 

 

Exploration expenses, including undeveloped
   lease amortization

 
390,711 

 
(147)

 (d)

 
390,564 

 

Selling and general expenses

 
269,986 

 
(3,388)

 (d)

 
265,206 

 

 

 

 

 
(1,392)

 (e)

 

 

 

Depreciation, depletion and amortization

 
1,354,393 

 
(156,390)

 (d)

 
1,198,003 

 

Accretion of asset retirement obligations

 
36,992 

 
(3,748)

 (d)

 
33,244 

 

Interest expense

 
101,625 

 
(3,808)

 (d)

 
97,817 

 

Interest capitalized

 
(19,244)

 
4,928 

 (d)

 
(14,316)

 

Other expense

 
1,297 

 

 

 

 
1,297 

 

           Total costs and expenses

 
3,033,191 

 
(244,440)

 

 
2,788,751 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations before income taxes

 
1,035,267 

 
(234,285)

 (d)

 
800,982 

 

Income tax expense

 
452,255 

 
(89,009)

 (d)

 
363,246 

 

Income from continuing operations

 
583,012 

 
(145,276)

 

 
437,736 

 

Income (loss) from discontinued operations, net of taxes

 
(52,639)

 

 

 

 
(52,639)

 

NET INCOME

$
530,373 

 
(145,276)

 

 
385,097 

 

 

 

 

 

 

 

 

 

 

PER COMMON SHARE – BASIC

 

 

 

 

 

 

 

 

    Income from continuing operations

$
3.25 

 

 

 

 
2.44 

 

    Income (loss) from discontinued operations

 
(0.29)

 

 

 

 
(0.29)

 

           Net income – Basic

$
2.96 

 

 

 

 
2.15 

 

 

 

 

 

 

 

 

 

 

PER COMMON SHARE – DILUTED

 

 

 

 

 

 

 

 

    Income from continuing operations

$
3.23 

 

 

 

 
2.42 

 

    Income from discontinued operations

 
(0.29)

 

 

 

 
(0.29)

 

           Net income – Diluted

$
2.94 

 

 

 

 
2.13 

 

 

 

 

 

 

 

 

 

 

Average Common shares outstanding

 

 

 

 

 

 

 

 

    Basic

 
179,259,573 

 

 

 

 
179,259,573 

 

    Diluted

 
180,578,085 

 

 

 

 
180,578,085 

 

 

 

 

 

 

 

 

Ex. 99.2-3

 

 

Murphy Oil Corporation

Unaudited Pro Forma Consolidated Statement of Income

Year Ended December 31, 2013

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Historical

 

Pro forma adjustments

 

 

Pro forma

 

Revenues

 

 

 

 

 

 

 

 

Sales and other operating revenues

$
5,312,686 

 
(684,171)

(d)

 
4,628,515 

 

Loss on sale of assets

 
(87)

 
5 

(d)

 
(82)

 

Interest and other income

 
77,490 

 
(15,656)

(d)

 
61,834 

 

           Total revenues

 
5,390,089 

 
(699,822)

 

 
4,690,267 

 

 

 

 

 

 

 

 

 

 

Costs and Expenses

 

 

 

 

 

 

 

 

Operating expenses

 
1,340,143 

 
(115,333)

(d)

 
1,224,810 

 

Severance and ad valorem taxes

 

– 

 

 

 

 

– 

 

Exploration expenses, including undeveloped
   lease amortization

 
502,215 

 
(7,242)

(d)

 
494,973 

 

Selling and general expenses

 
379,167 

 
(596)

(d)

 
378,571 

 

Depreciation, depletion and amortization

 
1,553,394 

 
(176,441)

(d)

 
1,376,953 

 

Impairment of properties

 
21,587 

 

 

 

 
21,587 

 

Accretion of asset retirement obligations

 
48,996 

 
(4,486)

(d)

 
44,510 

 

Interest expense

 
124,423 

 
(3,078)

(d)

 
121,345 

 

Interest capitalized

 
(52,523)

 
13,312 

(d)

 
(39,211)

 

           Total costs and expenses

 
3,917,402 

 
(293,864)

 

 
3,623,538 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations before income taxes

 
1,472,687 

 
(405,958)

(d)

 
1,066,729 

 

Income tax expense

 
584,550 

 
(147,782)

(d)

 
436,768 

 

Income from continuing operations

 
888,137 

 
(258,176)

 

 
629,961 

 

Income (loss) from discontinued operations,  net of taxes

 
235,336 

 

 

 

 
235,336 

 

NET INCOME

$
1,123,473 

 
(258,176)

 

 
865,297 

 

 

 

 

 

 

 

 

 

 

PER COMMON SHARE – BASIC

 

 

 

 

 

 

 

 

    Income from continuing operations

$
4.73 

 

 

 

 
3.35 

 

    Income (loss) from discontinued operations

 
1.25 

 

 

 

 
1.25 

 

           Net income – Basic

$
5.98 

 

 

 

 
4.60 

 

 

 

 

 

 

 

 

 

 

PER COMMON SHARE – DILUTED

 

 

 

 

 

 

 

 

    Income from continuing operations

$
4.69 

 

 

 

 
3.32 

 

    Income from discontinued operations

 
1.25 

 

 

 

 
1.25 

 

           Net income – Diluted

$
5.94 

 

 

 

 
4.57 

 

 

 

 

 

 

 

 

 

 

Average Common shares outstanding

 

 

 

 

 

 

 

 

    Basic

 
187,921,062 

 

 

 

 
187,921,062 

 

    Diluted

 
189,271,398 

 

 

 

 
189,271,398 

 

 

 

 

 

 

 

 

 

Ex. 99.2-4

 

 

Murphy Oil Corporation

Notes to Unaudited Pro Forma

Condensed Consolidated Financial Statements

 

NOTE 1:  Basis of Presentation

 

The historical information for Murphy Oil Corporation is derived from the historical financial statements of the Company.  The unaudited pro forma condensed consolidated balance sheet as of September 30, 2014, is presented to illustrate the estimated effects of selling a combined 30% of the Company’s interest in its Malaysian oil and gas assets to Pertamina (“sale transactions”) as if the transactions had occurred on September 30, 2014.  The unaudited pro forma condensed consolidated statements of income are presented for the nine months ended September 30, 2014 and the year ended December 31, 2013 as if the sale transactions had occurred at January 1, 2013.

 

NOTE 2:  Pro Forma Adjustments and Assumptions

 

 

 

(a)

Reflects the estimated cash sales proceeds of the sale transaction as if it had occurred on September 30, 2014.  The sale proceeds are presented net of preliminary estimated sale adjustments, mostly related to activities between the transaction’s effective date of January 1, 2014 and the date the sale transactions occurred.

 

 

(b)

Reflects the assets to be acquired and liabilities to be assumed by Pertamina as a result of the sale transactions.

 

 

(c)

Reflects the estimated net impact on Murphy’s stockholders’ equity related to the sale transactions.

 

 

(d)

Reflects the operations for the assets included in the sale transactions for the respective periods presented.

 

 

(e)

Reflects the costs of effecting the sale transactions that are factually supportable, including legal and advisor fees.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ex. 99.2-5