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Apache Corp. Reports Operating Results (10-Q)

May 08, 2012 | About:
10qk

10qk

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Apache Corp. (APA) filed Quarterly Report for the period ended 2012-03-31.

Apache Corp has a market cap of $36.43 billion; its shares were traded at around $87.58 with a P/E ratio of 7.9 and P/S ratio of 2.2. The dividend yield of Apache Corp stocks is 0.7%. Apache Corp had an annual average earning growth of 15.3% over the past 10 years. GuruFocus rated Apache Corp the business predictability rank of 3-star.

Highlight of Business Operations:

While crude oil prices remain strong, natural gas prices in North America have weakened considerably since the first quarter of 2011. Our first-quarter 2012 results were negatively impacted by a $390 million non-cash after-tax write-down of the carrying value of our Canadian proved oil and gas properties as a result of declining average natural gas prices for the 12 months ending March 31, 2012. For additional discussion on this write-down, refer to Operating HighlightsDepreciation, Depletion and Amortization in this Item 2. We believe weak natural gas prices in North America will continue to put pressure on gas revenues for the remainder of the year.

Crude oil revenues for the first quarter of 2012 totaled $3.5 billion, $620 million higher than the comparative 2011 quarter, the result of a 14-percent increase in average realized prices and a six-percent increase in worldwide production. Crude oil accounted for 79 percent of oil and gas production revenues and 45 percent of worldwide production in the first quarter of 2012, compared with 75 percent and 45 percent, respectively, in the first quarter of 2011. Higher realized prices added $397 million to the increase in first-quarter 2012 revenues compared to the prior-year quarter, while higher production volumes contributed an additional $223 million.

Gas revenues for the first quarter of 2012 totaled $811 million, down seven percent from the first quarter of 2011. A 12-percent drop in average realized prices reduced natural gas revenues $102 million as compared to the prior-year quarter, while a four-percent increase in average production added $39 million between the periods. Natural gas accounted for 18 percent of our oil and gas production revenues and 50 percent of our equivalent production during the first quarter of 2012, compared to 23 and 50 percent, respectively, for the first quarter of 2011. As a whole our international regions, which contribute approximately one-third of our worldwide gas production, benefitted from higher realized prices as compared to the prior-year quarter.

The North Sea Petroleum Revenue Tax (PRT) is assessed on net receipts (revenues less qualifying operating costs and capital spending) from our fields in the United Kingdom (U.K.) North Sea. U.K. PRT was $76 million higher than the 2011 period based on a 107-percent increase in net receipts, primarily driven by the Mobil North Sea acquisition and the Nelson field purchase. Higher realized oil prices resulted in an increase of severance tax expense of $8 million when compared to the prior-year period. Severance taxes are incurred primarily on onshore properties in the U.S. and certain properties in Australia and Argentina.

Net cash provided by operating activities for the first quarter of 2012 totaled $2.0 billion, up $28 million from the first quarter of 2011. The increase reflects the $579 million impact of higher oil and gas revenues, with higher commodity prices contributing $298 million, and a six-percent increase in daily equivalent production adding another $281 million. This increase was partially offset by the change in working capital in the first quarter of 2012 as compared to the prior-year quarter.

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