Attached files
| file | filename |
|---|---|
| 8-K - HESS CORPORATION 8-K - HESS CORP | a6697157.htm |
| EX-99.3 - EXHIBIT 99(3) - HESS CORP | a6697157ex99-3.htm |
| EX-99.2 - EXHIBIT 99(2) - HESS CORP | a6697157ex99-2.htm |
Exhibit 99(1)
Hess Reports Estimated Results for the First Quarter of 2011
First Quarter Highlights:
- Net income was $929 million compared with $538 million in the first quarter of 2010
- Net income included an after-tax gain of $310 million relating to asset sales
- Net cash provided by operating activities was $1,135 million, compared with $825 million in the first quarter of 2010
- Oil and gas production was 399,000 barrels per day, compared with 423,000 in the first quarter of 2010
NEW YORK--(BUSINESS WIRE)--April 27, 2011--Hess Corporation (NYSE: HES) reported net income of $929 million for the first quarter of 2011 compared with $538 million for the first quarter of 2010. The after-tax income (loss) by major operating activity was as follows:
| Three Months Ended | |||||||||
|
March 31, (unaudited) |
|||||||||
| 2011 | 2010 | ||||||||
| (In millions, except | |||||||||
|
per share amounts) |
|||||||||
| Exploration and Production | $ | 979 | $ | 551 | |||||
| Marketing and Refining | 39 | 87 | |||||||
| Corporate | (28 | ) | (48 | ) | |||||
| Interest expense | (61 | ) | (52 | ) | |||||
| Net income attributable to Hess Corporation | $ | 929 | $ | 538 | |||||
| Net income per share (diluted) | $ | 2.74 | $ | 1.65 | |||||
| Weighted average number of shares (diluted) | 339.2 | 327.0 | |||||||
| Note: See the following page for a table of items affecting the comparability of earnings between periods. |
Exploration and Production earnings were $979 million in the first quarter of 2011 compared with $551 million in the first quarter of 2010. The Corporation’s first quarter oil and gas production was 399,000 barrels of oil equivalent per day, down from 423,000 barrels of oil equivalent per day in the first quarter a year ago, primarily reflecting the
suspension of production in Libya in early March due to civil unrest and the sale of certain natural gas producing assets in the United Kingdom North Sea. The Corporation’s average worldwide crude oil selling price, including the effect of hedging, was $87.22 per barrel, an increase from $63.62 per barrel in the first quarter of 2010. The average worldwide natural gas selling price was $5.84 per Mcf in the first quarter of 2011 compared with $5.92 per Mcf in the same quarter a year ago. First quarter 2011 results included higher exploration expenses reflecting dry hole costs of $121 million ($77 million after-tax) associated with an exploration well located on Block 1 offshore Egypt in the North Red Sea.
Marketing and Refining earnings were $39 million in the first quarter of 2011 compared with $87 million in the same period in 2010. Refining operations incurred a loss of $48 million in the first quarter of 2011 compared with a loss of $56 million in the first quarter a year ago. Marketing earnings were $68 million compared with $121 million in the first quarter of 2010. Trading activities generated income of $19 million in the first quarter of 2011 compared with $22 million in the first quarter of last year.
The following table reflects the total after-tax income (expense) of items affecting the comparability of earnings between periods:
| Three Months Ended | ||||||||
|
March 31, (unaudited) |
||||||||
| (Millions of dollars) | ||||||||
| 2011 |
2010 |
|||||||
| Exploration and Production | $ | 310 | $ | 58 | ||||
| Corporate | - | (7 | ) | |||||
| $ | 310 | $ | 51 | |||||
First quarter 2011 results included an after-tax gain of $310 million related to the sale of the Corporation’s interests in certain natural gas producing assets in the United Kingdom North Sea.
Net cash provided by operating activities was $1,135 million in the first quarter of 2011, compared with $825 million in the same quarter of 2010. Capital and exploratory expenditures were $1,186 million, of which $1,173 million related to Exploration and Production operations. Capital and exploratory expenditures for the first quarter of 2010 were $861 million, of which $841 million related to Exploration and Production operations.
At March 31, 2011, cash and cash equivalents totaled $1,968 million up from $1,608 million at December 31, 2010. Total debt was $5,552 million at March 31, 2011 and $5,583 million at December 31, 2010. The Corporation’s debt to capitalization ratio at March 31, 2011 improved to 23.5 percent compared with 24.9 percent at the end of 2010.
Hess Corporation will review first quarter financial and operating results and other matters on a webcast at 10 a.m. today. For details about the event, refer to the Investor Relations section of our website at www.hess.com.
Hess Corporation, with headquarters in New York, is a global integrated energy company engaged in the exploration, production, purchase, transportation and sale of crude oil and natural gas, as well as the production and sale of refined petroleum products. More information on Hess Corporation is available at www.hess.com.
Forward Looking Statements
Certain statements in this release may constitute "forward-looking statements" within the meaning of Section 21E of the United States Securities Exchange Act of 1934, as amended, and Section 27A of the United States Securities Act of 1933, as amended. Forward-looking statements are subject to known and unknown risks and uncertainties and other factors which may cause actual results to differ materially from those expressed or implied by such statements, including, without limitation, uncertainties inherent in the measurement and interpretation of geological, geophysical and other technical data.
| HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES | ||||||||||||||
| SUPPLEMENTAL FINANCIAL DATA (UNAUDITED) | ||||||||||||||
| (IN MILLIONS OF DOLLARS) | ||||||||||||||
| First | First | Fourth | ||||||||||||
| Quarter | Quarter | Quarter | ||||||||||||
| 2011 | 2010 | 2010 | ||||||||||||
|
Income Statement |
||||||||||||||
| Revenues and Non-operating Income | ||||||||||||||
| Sales (excluding excise taxes) and other operating revenues | $ | 10,215 | $ | 9,259 | $ | 9,007 | ||||||||
| Income (loss) from equity investment in HOVENSA L.L.C. | (48 | ) | (85 | ) | (348 | ) | ||||||||
| Other, net | 348 | 46 | 31 | |||||||||||
| Total revenues and non-operating income | 10,515 | 9,220 | 8,690 | |||||||||||
| Costs and Expenses | ||||||||||||||
| Cost of products sold (excluding items shown separately below) | 7,040 | 6,540 | 6,221 | |||||||||||
| Production expenses | 531 | 477 | 532 | |||||||||||
| Marketing expenses | 283 | 253 | 291 | |||||||||||
| Exploration expenses, including dry holes | ||||||||||||||
| and lease impairment | 313 | 151 | 317 | |||||||||||
| Other operating expenses | 42 | 52 | 42 | |||||||||||
| General and administrative expenses | 164 | 155 | 197 | |||||||||||
| Interest expense | 99 | 84 | 100 | |||||||||||
| Depreciation, depletion and amortization | 558 | 542 | 633 | |||||||||||
| Total costs and expenses | 9,030 | 8,254 | 8,333 | |||||||||||
| Income before income taxes | 1,485 | 966 | 357 | |||||||||||
| Provision for income taxes | 511 | 398 | 274 | |||||||||||
| Net income | 974 | 568 | 83 | |||||||||||
| Less: Net income (loss) attributable to noncontrolling interests | 45 | 30 | 25 | |||||||||||
| Net income attributable to Hess Corporation | $ | 929 | $ | 538 | $ | 58 | ||||||||
|
Supplemental Income Statement Information |
||||||||||||||
| Foreign currency gains (losses), after-tax | $ | (3 | ) | $ | (1 | ) | $ | 2 | ||||||
| Capitalized interest | 2 | 1 | 2 | |||||||||||
|
Cash Flow Information |
||||||||||||||
| Net cash provided by operating activities (*) | $ | 1,135 | $ | 825 | $ | 1,478 | ||||||||
|
Capital and Exploratory Expenditures |
||||||||||||||
| Exploration and Production | ||||||||||||||
| United States | $ | 540 | $ | 337 | $ | 1,820 | ||||||||
| International | 633 | 504 | 618 | |||||||||||
| Total Exploration and Production | 1,173 | 841 | 2,438 | |||||||||||
| Marketing, Refining and Corporate | 13 | 20 | 26 | |||||||||||
| Total Capital and Exploratory Expenditures | $ | 1,186 | $ | 861 | $ | 2,464 | ||||||||
| Exploration expenses charged to income included above | ||||||||||||||
| United States | $ | 42 | $ | 41 | $ | 46 | ||||||||
| International | 62 | 32 | 77 | |||||||||||
| $ | 104 | $ | 73 | $ | 123 | |||||||||
| (*) Includes changes in working capital | ||||||||||||||
| HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES | ||||||||||
| SUPPLEMENTAL FINANCIAL DATA (UNAUDITED) | ||||||||||
| (IN MILLIONS OF DOLLARS) | ||||||||||
|
|
March 31, |
December 31, | ||||||||
| 2011 | 2010 | |||||||||
|
Balance Sheet Information |
||||||||||
| Cash and cash equivalents | $ | 1,968 | $ | 1,608 | ||||||
| Other current assets | 7,468 | 7,172 | ||||||||
| Investments | 446 | 443 | ||||||||
| Property, plant and equipment – net | 21,759 | 21,127 | ||||||||
| Other long-term assets | 4,996 | 5,046 | ||||||||
| Total assets | $ | 36,637 | $ | 35,396 | ||||||
| Short-term debt and current maturities of long-term debt | $ | 35 | $ | 46 | ||||||
| Other current liabilities | 7,316 | 7,567 | ||||||||
| Long-term debt | 5,517 | 5,537 | ||||||||
| Other long-term liabilities | 5,652 | 5,437 | ||||||||
| Total equity excluding other comprehensive income (loss) | 18,990 | 17,968 | ||||||||
| Accumulated other comprehensive income (loss) | (873 | ) | (1,159 | ) | ||||||
| Total liabilities and equity | $ | 36,637 | $ | 35,396 | ||||||
| HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES | |||||||||||
| EXPLORATION AND PRODUCTION EARNINGS (UNAUDITED) | |||||||||||
| (IN MILLIONS OF DOLLARS) | |||||||||||
| First Quarter 2011 | |||||||||||
|
United |
|||||||||||
| States | International |
Total |
|||||||||
| Sales and other operating revenues | $ | 746 | $ | 1,867 | $ | 2,613 | |||||
| Other, net | (1 | ) | 345 | 344 | |||||||
| Total revenues and non-operating income | 745 | 2,212 | 2,957 | ||||||||
| Costs and expenses | |||||||||||
| Production expenses, including related taxes | 137 | 394 | 531 | ||||||||
| Exploration expenses, including dry holes | |||||||||||
| and lease impairment | 109 | 204 | 313 | ||||||||
| General, administrative and other expenses | 48 | 36 | 84 | ||||||||
| Depreciation, depletion and amortization | 152 | 385 | 537 | ||||||||
| Total costs and expenses | 446 | 1,019 | 1,465 | ||||||||
| Results of operations before income taxes | 299 | 1,193 | 1,492 | ||||||||
| Provision for income taxes | 112 | 401 | 513 | ||||||||
| Results of operations attributable to Hess Corporation | $ | 187 | $ | 792 | $ | 979 | |||||
| First Quarter 2010 | |||||||||||
| United | |||||||||||
| States | International | Total | |||||||||
| Sales and other operating revenues | $ | 582 | $ | 1,532 | $ | 2,114 | |||||
| Other, net | (1 | ) | 55 | 54 | |||||||
| Total revenues and non-operating income | 581 | 1,587 | 2,168 | ||||||||
| Costs and expenses | |||||||||||
| Production expenses, including related taxes | 116 | 361 | 477 | ||||||||
| Exploration expenses, including dry holes | |||||||||||
| and lease impairment | 78 | 73 | 151 | ||||||||
| General, administrative and other expenses | 36 | 31 | 67 | ||||||||
| Depreciation, depletion and amortization | 136 | 383 | 519 | ||||||||
| Total costs and expenses | 366 | 848 | 1,214 | ||||||||
| Results of operations before income taxes | 215 | 739 | 954 | ||||||||
| Provision for income taxes | 77 | 326 | 403 | ||||||||
| Results of operations attributable to Hess Corporation | $ | 138 | $ | 413 | $ | 551 | |||||
| Fourth Quarter 2010 | |||||||||||
| United | |||||||||||
| States | International | Total | |||||||||
| Sales and other operating revenues | $ | 679 | $ | 1,613 | $ | 2,292 | |||||
| Other, net | (5 | ) | 13 | 8 | |||||||
| Total revenues and non-operating income | 674 | 1,626 | 2,300 | ||||||||
| Costs and expenses | |||||||||||
| Production expenses, including related taxes | 143 | 389 | 532 | ||||||||
| Exploration expenses, including dry holes | |||||||||||
| and lease impairment | 121 | 196 | 317 | ||||||||
| General, administrative and other expenses | 56 | 24 | 80 | ||||||||
| Depreciation, depletion and amortization | 184 | 425 | 609 | ||||||||
| Total costs and expenses | 504 | 1,034 | 1,538 | ||||||||
| Results of operations before income taxes | 170 | 592 | 762 | ||||||||
| Provision for income taxes | 72 | 270 | 342 | ||||||||
| Results of operations attributable to Hess Corporation | $ | 98 | $ | 322 | $ | 420 | |||||
| HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES | ||||||||||||||
| EXPLORATION AND PRODUCTION SUPPLEMENTAL OPERATING DATA (UNAUDITED) | ||||||||||||||
| First | First | Fourth | ||||||||||||
| Quarter | Quarter | Quarter | ||||||||||||
| 2011 | 2010 | 2010 | ||||||||||||
|
Operating Data |
||||||||||||||
|
Net Production Per Day (in thousands) |
||||||||||||||
| Crude oil - barrels | ||||||||||||||
| United States | 77 | 71 | 76 | |||||||||||
| Europe | 99 | 86 | 103 | |||||||||||
| Africa | 84 | 118 | 99 | |||||||||||
| Asia | 14 | 14 | 13 | |||||||||||
| Total | 274 | 289 | 291 | |||||||||||
| Natural gas liquids - barrels | ||||||||||||||
| United States | 13 | 13 | 14 | |||||||||||
| Europe | 4 | 3 | 4 | |||||||||||
| Asia | 1 | 1 | 1 | |||||||||||
| Total | 18 | 17 | 19 | |||||||||||
| Natural gas - mcf | ||||||||||||||
| United States | 106 | 97 | 114 | |||||||||||
| Europe | 107 | 156 | 138 | |||||||||||
| Asia and other | 430 | 452 | 411 | |||||||||||
| Total | 643 | 705 | 663 | |||||||||||
| Barrels of oil equivalent | 399 | 423 | 420 | |||||||||||
|
Average Selling Price |
||||||||||||||
| Crude oil - per barrel (including hedging)* | ||||||||||||||
| United States | $ | 91.56 | $ | 74.40 | $ | 80.65 | ||||||||
| Europe | 84.17 | 55.25 | 63.18 | |||||||||||
| Africa | 82.32 | 62.38 | 70.21 | |||||||||||
| Asia | 110.80 | 71.67 | 86.94 | |||||||||||
|
Worldwide |
87.22 | 63.62 | 71.73 | |||||||||||
| Crude oil - per barrel (excluding hedging) | ||||||||||||||
| United States | $ | 91.56 | $ | 74.40 | $ | 80.65 | ||||||||
| Europe | 84.17 | 55.25 | 63.18 | |||||||||||
| Africa | 102.58 | 75.96 | 86.40 | |||||||||||
| Asia | 110.80 | 71.67 | 86.94 | |||||||||||
| Worldwide | 92.35 | 69.06 | 77.17 | |||||||||||
| Natural gas liquids - per barrel | ||||||||||||||
| United States | $ | 57.31 | $ | 51.11 | $ | 51.89 | ||||||||
| Europe | 80.29 | 59.38 | 64.65 | |||||||||||
| Asia | 73.35 | 63.92 | 70.22 | |||||||||||
| Worldwide | 63.45 | 52.93 | 55.00 | |||||||||||
| Natural gas - per mcf | ||||||||||||||
| United States | $ | 3.82 | $ | 4.63 | $ | 3.11 | ||||||||
| Europe | 8.25 | 5.41 | 7.81 | |||||||||||
| Asia and other | 5.75 | 6.37 | 5.06 | |||||||||||
| Worldwide | 5.84 | 5.92 | 5.30 | |||||||||||
|
|
||||||||||||||
| * | The after-tax losses from crude oil hedging activities were $81 million in the first quarter of 2011, $83 million in the first quarter of 2010 and $86 million in the fourth quarter of 2010. |
| HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES | ||||||||||||||||||||
| MARKETING AND REFINING SUPPLEMENTAL FINANCIAL AND OPERATING DATA (UNAUDITED) | ||||||||||||||||||||
| First | First | Fourth | ||||||||||||||||||
| Quarter | Quarter | Quarter | ||||||||||||||||||
| 2011 | 2010 | 2010 | ||||||||||||||||||
|
Financial Information (in millions of dollars) |
||||||||||||||||||||
|
Marketing and Refining Results |
||||||||||||||||||||
| Income (loss) before income taxes | $ | 96 | $ | 139 | $ |
(251 |
) |
|||||||||||||
| Provision (benefit) for income taxes | 57 | 52 | 10 | |||||||||||||||||
| Results of operations attributable to Hess Corporation | $ | 39 | $ | 87 | $ |
(261 |
) |
|||||||||||||
|
Summary of Marketing and Refining Results |
||||||||||||||||||||
| Refining | $ |
(48 |
) |
$ |
(56 |
) |
$ |
(308 |
) |
|||||||||||
| Marketing | 68 | 121 | 37 | |||||||||||||||||
| Trading | 19 | 22 | 10 | |||||||||||||||||
| Results of operations attributable to Hess Corporation | $ | 39 | $ | 87 | $ |
(261 |
) |
|||||||||||||
|
Operating Data (barrels and gallons in thousands) |
||||||||||||||||||||
|
Refined Product Sales (barrels per day) |
||||||||||||||||||||
| Gasoline | 226 | 251 | 225 | |||||||||||||||||
| Distillates | 134 | 126 | 144 | |||||||||||||||||
| Residuals | 87 | 86 | 78 | |||||||||||||||||
| Other | 20 | 51 | 42 | |||||||||||||||||
| Total | 467 | 514 | 489 | |||||||||||||||||
|
Refinery Throughput (barrels per day) |
||||||||||||||||||||
| HOVENSA - Crude runs | 263 | 375 | 384 | |||||||||||||||||
| HOVENSA - Hess 50% share | 132 | 188 | 192 | |||||||||||||||||
| Port Reading | 66 | 62 | 60 | |||||||||||||||||
|
Refinery Utilization |
Refinery Capacity |
|||||||||||||||||||
| HOVENSA | (barrels per day) | |||||||||||||||||||
| Crude |
350 |
(a) |
75.2% | 75.1% | 76.8% | |||||||||||||||
| FCC | 150 | 65.6% | 41.2% | 57.3% | ||||||||||||||||
| Coker | 58 | 41.6% | 85.0% | 73.3% | ||||||||||||||||
| Port Reading | 70 | 94.0% | 88.8% | 86.0% | ||||||||||||||||
|
Retail Marketing |
||||||||||||||||||||
| Number of retail stations (b) | 1,350 | 1,359 | 1,362 | |||||||||||||||||
| Convenience store revenue (in millions of dollars) (c) | $ | 278 | $ | 276 | $ | 298 | ||||||||||||||
| Average gasoline volume per station (gallons per month) (c) | 185 | 188 | 201 | |||||||||||||||||
|
|
||||||||||||||||||||
| (a) | HOVENSA’s refining crude capacity was reduced from 500,000 to 350,000 barrels per day in the first quarter of 2011. |
| (b) | Includes company operated, Wilco-Hess, dealer and branded retailer. |
| (c) | Company operated only. |
CONTACT:
Hess Corporation
Investor Contact:
Jay
Wilson, 212-536-8940
or
Media Contact:
Jon
Pepper, 212-536-8550
8