Apache Q2 Profit Down 50%, Mulls Options For International Assets

(RTTNews) - Oil and natural gas producer Apache Corp. (APA) on Thursday reported a profit for the second quarter that halved from last year on lower revenues. The company also reported a 15 percent decline in production for the quarter.

Consistent with the company's ongoing repositioning for profitable and repeatable North American onshore growth, Apache said it plans to completely exit the Wheatstone LNG project in Australia and Kitimat LNG project in Canada.

Activist investor Jana Partners LLC has urged Apache to sell its international holdings and focus on drilling onshore in the U.S.

Apache is also evaluating its international assets and exploring multiple opportunities, including the potential separation of some or all of these assets through the capital markets.

Houston, Texas-based Apache reported net incomes attributable to common shareholders for the second quarter of $505 million or $1.31 per share, down from $1.02 billion or $2.54 per share in the prior-year quarter. The prior-year quarter's results included loss from discontinued operations of $517 million or $1.32 per share.

Excluding items, adjusted earnings for the quarter were $644 million or $1.67 per share, compared to $813 million or $2.04 per share in the year-ago quarter.

On average, 30 analysts polled by Thomson Reuters expected the company to report earnings of $1.65 per share for the quarter. Analysts' estimates typically exclude special items.

However, revenues and other for the quarter declined 19 percent to $3.48 billion from $4.27 billion in the same quarter last year. Analysts' revenue consensus was $3.64 billion.

Oil and gas production revenues also declined 7 percent to $3.71 billion. Apache's total worldwide production of oil, natural gas, and natural gas liquids for the quarter averaged 635,814 barrels of oil equivalent or boe per day, down 15 percent from last year's 747,452 boe per day.

Pro forma production in the quarter averaged 550,356 boe per day, compared to 529,422 boe per day in the year-ago period.

Worldwide, Apache received an average price of $103.53 per barrel of crude oil, up 5 percent from the year-ago period. Average price for natural gas also rose 5 percent from the prior-year quarter to $4.18 per thousand cubic feet or Mcf.

Total costs and expenses for the quarter declined 4 percent from the year-ago period to $2.51 billion.

During the latest quarter, Apache completed the sale of the non-producing Lucius and Heidelberg deepwater developments as well as divesting selected, primarily gas-producing properties in western Canada and South Texas. This brings the company's divestments over the last year to $10 billion.

APA is currently trading at $103.78, up $2.49 or 2.46 percent on a volume of 1.79 million shares.