GuruFocus Premium Membership

Serving Intelligent Investors since 2004. Only 96 cents a day.

Free Trial

Free 7-day Trial
All Articles and Columns »

Apco Reports Second-Quarter 2009 Results

August 07, 2009 | About:

Press Release: Apco Reports Second-Quarter 2009 Results

TULSA, Okla., Aug. 7 /PRNewswire-FirstCall/ -- Apco Oil and Gas International Inc. (Nasdaq: APAGF) today announced that for the three and six-month periods ended June 30, 2009, it generated unaudited net income attributable to Apco of $5.4 million and $10.4 million, or $0.18 and $0.35 per share, compared with net income of $7.2 million and $13.6 million for the comparable periods in 2008. Although Apco has been able to increase oil and natural gas sales volumes year-to-date, favorable volume impacts on operating revenues of $868,000 for the quarter and $2.7 million for the first six months were more than offset by the effects of lower oil and LPG prices and the absence of a one-time oil price adjustment that benefited operating revenues in 2008. "We are extremely pleased with the success of our drilling activities that resulted in increased product volumes, but oil price fluctuations are a variable over which we have little control," said Thomas Bueno, Apco\'s president and chief operating officer. "When world oil prices fell sharply earlier this year, our net realized oil price fell below $40 per barrel. That has resulted in an average year-to-date oil price for us that is eight percent lower than 2008." The quarter-to-quarter decrease in net income primarily is due to lower operating revenues and lower investment income which combined to more than offset the benefits of decreased costs and operating expenses. Apco\'s operating revenues decreased by $1.7 million in second-quarter 2009 compared with the same period a year ago. Revenues during the 2009 quarter were lower due to the absence of a $1.2 million benefit in second-quarter 2008 relating to a retroactive oil price adjustment. In addition, the previously referenced benefits of increased oil and natural gas sales volumes were more than offset by lower average oil and LPG sales prices. Total costs and operating expenses in the second quarter of 2009 decreased by $1.5 million compared with the same period a year ago, reflecting lower production and lifting costs and the absence of dry-hole and seismic expense recorded in second-quarter 2008. These positive variances were partially offset by higher depreciation, depletion and amortization and increased selling and administrative expenses for the quarter resulting from Apco\'s business development efforts in Colombia. Additionally, Apco experienced lower equity income from Apco\'s equity investee, Petrolera Entre Lomas S.A. ("Petrolera"). Petrolera\'s net income was lower primarily due to lower operating revenues attributable to operations in the Entre Lomas and Bajada del Palo concessions. The $3.2 million decrease in net income for the first six months of 2009, compared with the same period in 2008, is the result of higher costs and expenses, lower equity income from Argentine investments and a decrease in average oil and LPG prices that more than offset the benefit of increases in oil and natural gas sales volumes. 2009 Capital Program As a result of improving operating cash flow projections for the second half of 2009, Apco\'s 2009 capital expenditure budget - net to the company\'s direct working interests - is now estimated at $20 million. To date, $8.8 million of that amount has been invested, primarily for development drilling in the Entre Lomas and Bajada del Palo concessions, along with a seventh productive well in the Agua Amarga exploration permit. On a basis that also includes capital expenditures attributable to the company\'s equity interest in Petrolera, Apco\'s combined consolidated and equity capital expenditures is expected to total $44 million for 2009. "Toward the end of the second quarter, we began to see oil price net backs in Argentina returning to 2008 levels. This gives us some encouragement for product prices for the balance of 2009," Bueno said. "Given what now appears to be an improving price and cost environment compared with the first-quarter of this year, together with a debt repayment grace period successfully obtained by Petrolera, we have revived certain drilling investments for the balance of 2009 that were being scaled back," Bueno added.

Apco Oil and Gas International Inc.    Summary of Earnings    (In Thousands of Dollars Except Per Share Amounts)                                                              2009    2008                                                              ----    ----    Three months ended June 30    -----------------------------------------------------------------------    Operating Revenue                                        15,818  17,500    -----------------------------------------------------------------------    Costs and operating expenses                             12,190  13,652    -----------------------------------------------------------------------    Investment Income                                         3,562   4,621    -----------------------------------------------------------------------    Net income                                                5,394   7,192    -----------------------------------------------------------------------    Per share                                                  0.18    0.24    -----------------------------------------------------------------------                                                              2009    2008                                                              ----    ----    Six months ended June 30    -----------------------------------------------------------------------    Operating Revenue                                        33,075  33,105    -----------------------------------------------------------------------    Costs and operating expenses                             26,170  24,774    -----------------------------------------------------------------------    Investment Income                                         6,774   8,269    -----------------------------------------------------------------------    Net income                                               10,412  13,641    -----------------------------------------------------------------------    Per share                                                  0.35    0.46    -----------------------------------------------------------------------
About Apco (NASDAQ: APAGF)Apco is an international oil and gas exploration and production company with interests in seven oil and gas concessions and one exploration permit in Argentina. More information is available at www.apcooilandgas.com. Go to http://www.b2i.us/irpass.asp?BzID=1671&to=ea&s=0 to join our e-mail list.

Contact:      Kelly Swan                  Media Relations                  (918) 573-4944                  Thomas Bueno                  Investor Relations                  (918) 573-2570
About Apco (NASDAQ: APAGF)Apco is an international oil and gas exploration and production company with interests in seven oil and gas concessions and one exploration permit in Argentina. More information is available at www.apcooilandgas.com. Go to http://www.b2i.us/irpass.asp?BzID=1671&to=ea&s=0 to join our e-mail list.

Source: PRNewsWire

Rating: 0.0/5 (0 votes)

Comments

Please leave your comment:


Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK
Email Hide