Occidental Petroleum Corporation (OXY) posted better-than-expected numbers for the third quarter of 2009 based on higher sales volumes and lower operating expenses.
Net income from continuing operations was $1.14 per share, higher than the Zacks Consensus Estimate of $1.08. However, net income in the quarter was lower than the $2.77 per share reported in the same period last year.
Daily oil and gas sales volumes increased 6.8%, averaging 628,000 barrels of oil equivalent (BOE) during the reported quarter, compared with 588,000 BOE sold in the third quarter of 2008. Volumes increased by approximately 6% domestically, mainly from California and the Permian, and by about 15% in the Middle East/North Africa, largely in Oman and Dolphin. This was offset by a 6% decline in Latin America, mostly due to a labor strike in Argentina. Increased California volumes resulted largely from the new exploration discoveries in Kern County.
Revenue decreased 41.9% to $4,104 million in the third quarter, compared to $7,060 million a year ago. The decline was due to lower crude oil and natural gas prices during the quarter. Occidental’s average realized crude oil and natural gas prices declined in the quarter by 39% and 67%, respectively.
The company continues to maintain its financial flexibility with net debt of $2.8 billion and total debt-to-capitalization of 9% at the end of third quarter 2009. Capital spending for the quarter was $746 million.
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