HESS CORP - FORM 8-K - EX-99.(1) - EXHIBIT 99(1)

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8-K - HESS CORPORATION 8-K - HESS CORP	a50249666.htm
EX-99.(2) - EXHIBIT 99(2) - HESS CORP	a50249666_ex992.htm

	Exhibit 99(1)
	HESS CORPORATION


	Investor Contact:Jay Wilson (212) 536-8940
	Media Contact:Jon Pepper (212) 536-8550
News Release

HESS REPORTS ESTIMATED RESULTS FOR THE FIRST QUARTER OF 2012

First Quarter Highlights:

·	Net income was $545 million, compared with $929 million in the first quarter of 2011

·	Net income excluding items affecting comparability between periods was $509 million, compared with $619 million in the first quarter of 2011

·	Oil and gas production was 397,000 barrels of oil equivalent per day, compared with 399,000 in the first quarter of 2011

NEW YORK, April 25, 2012 -- Hess Corporation (NYSE: HES) reported net income of $545 million for the first quarter of 2012 compared with $929 million for the first quarter of 2011. The after-tax income (loss) by major operating activity was as follows:

	Three Months Ended
	March 31, (unaudited)
	2012			2011
	(In millions, except per share amounts)
Exploration and Production	$	635		$	979
Marketing and Refining		11			39
Corporate		(38	)		(28	)
Interest expense		(63	)		(61	)
Net income attributable to Hess Corporation	$	545		$	929

Net income per share (diluted)	$	1.60		$	2.74

Weighted average number of shares (diluted)		340.3			339.2

Note: See the following page for a table of items affecting comparability of earnings between periods.

Exploration and Production earnings were $635 million in the first quarter of 2012 compared with $979 million in the first quarter of 2011. The Corporation’s average worldwide crude oil selling price, including the effect of hedging, was $89.92 per barrel, up from $87.22 per barrel in the same quarter a year ago. The average worldwide natural gas selling price was $6.23 per mcf in the first quarter of 2012, up from $5.84 per mcf in the first quarter of 2011. First quarter

oil and gas production was 397,000 barrels of oil equivalent per day compared with 399,000 barrels of oil equivalent per day in the first quarter a year ago.

Marketing and Refining earnings were $11 million in the first quarter of 2012 compared with $39 million in the same period in 2011. Marketing earnings, reflecting the impact of a mild winter on energy marketing operations, were $22 million in the first quarter of 2012 compared with $68 million in the first quarter of 2011. Refining operations incurred a loss of $6 million in the first quarter of 2012, compared with a loss of $48 million in the first quarter a year ago. Trading results were a loss of $5 million in the first quarter of 2012, compared with income of $19 million in the first quarter of last year.

The following table reflects the total after-tax income (expense) of items affecting comparability of earnings between periods:

		Three Months Ended
		March 31, (unaudited)
		2012		2011
		(Millions of dollars)
Exploration and Production	$	36	$	310

First quarter 2012 results included a gain of $36 million related to the sale of the Corporation’s interest in the Snohvit Field, offshore Norway.

Net cash provided by operating activities was $988 million in the first quarter of 2012, compared with $1,135 million in the same quarter of 2011. Capital and exploratory expenditures were $1,986 million, of which $1,963 million related to Exploration and Production operations. Capital and exploratory expenditures for the first quarter of 2011 were $1,186 million, of which $1,173 million related to Exploration and Production operations.

At March 31, 2012, cash and cash equivalents totaled $396 million compared with $351 million at December 31, 2011. Total debt was $6,978 million at March 31, 2012 and $6,057 million at December 31, 2011. The Corporation’s debt to capitalization ratio at March 31, 2012 was 26.7 percent compared with 24.6 percent at the end of 2011.

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
				2012			2011			2011
Income Statement
	Revenues and Non-operating Income
		Sales (excluding excise taxes) and other operating revenues		$	9,682		$	10,215		$	9,733
		Income (loss) from equity investment in HOVENSA L.L.C.			-			(48	)		(940	)
		Other, net			65			348			31

			Total revenues and non-operating income		9,747			10,515			8,824

	Costs and Expenses
		Cost of products sold (excluding items shown separately below)			6,679			7,040			6,712
		Production expenses			673			531			613
		Marketing expenses			251			283			273
		Exploration expenses, including dry holes and lease impairment			253			313			426
		Other operating expenses			41			42			44
		General and administrative expenses			167			164			187
		Interest expense			104			99			93
		Depreciation, depletion and amortization			681			558			674

			Total costs and expenses		8,849			9,030			9,022

		Income (loss) before income taxes			898			1,485			(198	)
		Provision (benefit) for income taxes			338			511			(64	)

		Net income (loss)			560			974			(134	)
		Less: Net income (loss) attributable to noncontrolling interests			15			45			(3	)
		Net income (loss) attributable to Hess Corporation		$	545		$	929		$	(131	)

Supplemental Income Statement Information
	Foreign currency gains (losses), after-tax			$	9		$	(3	)	$	(8	)
	Capitalized interest				5			2			5

Cash Flow Information
	Net cash provided by operating activities (a)			$	988	(b)	$	1,135		$	1,138

Capital and Exploratory Expenditures
	Exploration and Production
		United States		$	1,241		$	540		$	1,372
		International			722			633			813

			Total Exploration and Production		1,963			1,173			2,185
	Marketing, Refining and Corporate				23			13			51

			Total Capital and Exploratory Expenditures	$	1,986		$	1,186		$	2,236

	Exploration expenses charged to income included above
		United States		$	37		$	42		$	51
		International			71			62			70

				$	108		$	104		$	121

(a)	Includes changes in working capital.

(b)	Net of payments to HOVENSA L.L.C. totaling $487 million to fully fund our share of previously accrued refining shutdown costs.

HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES

SUPPLEMENTAL FINANCIAL DATA (UNAUDITED)

(IN MILLIONS OF DOLLARS)



	March 31,			December 31,
	2012			2011
Balance Sheet Information

Cash and cash equivalents	$	396		$	351
Other current assets		7,816			7,988
Investments		415			384
Property, plant and equipment – net		26,052			24,712
Other long-term assets		5,968			5,701
Total assets	$	40,647		$	39,136

Short-term debt and current maturities of long-term debt	$	38		$	52
Other current liabilities		8,153			8,048
Long-term debt		6,940			6,005
Other long-term liabilities		6,359			6,439
Total equity excluding other comprehensive income (loss)		20,214			19,659
Accumulated other comprehensive income (loss)		(1,057	)		(1,067	)
Total liabilities and equity	$	40,647		$	39,136

HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES

EXPLORATION AND PRODUCTION EARNINGS (UNAUDITED)

(IN MILLIONS OF DOLLARS)

			First Quarter 2012
			United
			States				International			Total

Sales and other operating revenues			$	923			$	1,697		$	2,620
Other, net				-				63			63

		Total revenues and non-operating income		923				1,760			2,683
Costs and expenses
	Production expenses, including related taxes			231				442			673
	Exploration expenses, including dry holes and lease impairment			78				175			253
	General, administrative and other expenses			38				27			65
	Depreciation, depletion and amortization			279				380			659

		Total costs and expenses		626				1,024			1,650

	Results of operations before income taxes			297				736			1,033
	Provision (benefit) for income taxes			110				288			398

Results of operations attributable to Hess Corporation			$	187		(a)	$	448	(b)	$	635

			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 (benefit) for income taxes			112				401			513

Results of operations attributable to Hess Corporation			$	187			$	792	(b)	$	979

			Fourth Quarter 2011
			United
			States				International			Total

Sales and other operating revenues			$	937			$	1,662		$	2,599
Other, net				3				25			28

		Total revenues and non-operating income		940				1,687			2,627
Costs and expenses
	Production expenses, including related taxes			170				443			613
	Exploration expenses, including dry holes and lease impairment			118				308			426
	General, administrative and other expenses			49				33			82
	Depreciation, depletion and amortization			273				378			651

		Total costs and expenses		610				1,162			1,772

	Results of operations before income taxes			330				525			855
	Provision (benefit) for income taxes			130				198			328

Results of operations attributable to Hess Corporation			$	200			$	327	(b)	$	527

(a)	The after-tax losses from crude oil hedging activities were $26 million.

(b)	The after-tax losses from crude oil hedging activities were $125 million in the first quarter of 2012, $81 million in the first quarter of 2011 and $83 million in the fourth quarter of 2011.

HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES

EXPLORATION AND PRODUCTION SUPPLEMENTAL OPERATING DATA (UNAUDITED)

	First		First		Fourth
	Quarter		Quarter		Quarter
	2012		2011		2011
Operating Data
Net Production Per Day (in thousands)
Crude oil - barrels
United States		95		77		89
Europe		94		99		95
Africa (a)		71		84		54
Asia		16		14		13
Total		276		274		251

Natural gas liquids - barrels
United States		14		13		13
Europe		3		4		4
Asia		2		1		1
Total		19		18		18

Natural gas - mcf
United States		100		106		90
Europe		61		107		92
Asia and other		449		430		408
Total		610		643		590
Barrels of oil equivalent		397		399		367

Average Selling Price
Crude oil - per barrel (including hedging)
United States	$	95.92	$	91.56	$	100.76
Europe		80.18		84.17		77.18
Africa		88.75		82.32		85.49
Asia		117.13		110.80		111.08
Worldwide		89.92		87.22		89.70

Crude oil - per barrel (excluding hedging)
United States	$	100.87	$	91.56	$	100.76
Europe		82.77		84.17		77.18
Africa		120.59		102.58		109.28
Asia		123.72		110.80		111.08
Worldwide		100.50		92.35		95.16

Natural gas liquids - per barrel
United States	$	49.26	$	57.31	$	57.86
Europe		90.43		80.29		66.47
Asia		86.50		73.35		66.18
Worldwide		59.53		63.45		59.81

Natural gas - per mcf
United States	$	1.75	$	3.82	$	2.50
Europe		9.44		8.25		8.88
Asia and other		6.77		5.75		6.57
Worldwide		6.23		5.84		6.32

(a)	Includes Libyan production of 18 thousand barrels of oil per day (bopd) in the first quarter of 2012, 14 thousand bopd in the first quarter of 2011 and 2 thousand bopd in the fourth quarter of 2011.

HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES

MARKETING AND REFINING SUPPLEMENTAL FINANCIAL AND OPERATING DATA (UNAUDITED)




	First			First			Fourth
	Quarter			Quarter			Quarter
	2012			2011			2011
Financial Information (in millions of dollars)

Marketing and Refining Results
Income (loss) before income taxes	$	20		$	96		$	(885	)
Provision (benefit) for income taxes		9			57			(324	)
Results of operations attributable to Hess Corporation	$	11		$	39		$	(561	)

Summary of Marketing and Refining Results
Marketing	$	22		$	68		$	48
Refining		(6	)		(48	)		(598	)
Trading		(5	)		19			(11	)
Results of operations attributable to Hess Corporation	$	11		$	39		$	(561	)


Operating Data

Sales Volumes
Refined petroleum products (thousands of barrels per day)
Gasoline		210			226			214
Distillates		115			134			143
Residuals		61			87			65
Other		18			20			19
Total		404			467			441

Natural gas (thousands of mcf per day)		2,560			2,875			2,170

Electricity (megawatts round the clock)		4,350			4,345			4,110

Retail Marketing
Number of retail stations (a)		1,361			1,350			1,360
Convenience store revenue (in millions of dollars) (b)	$	272		$	278		$	290
Average gasoline volume per station (thousands of gallons per month) (b)		185			185			195

Port Reading
Refinery throughput (thousands of barrels per day)		47			66			58
Refinery utilization (capacity - 70,000 barrels per day)		67.4	%		94.0	%		82.9	%

(a)	Includes company operated, Wilco-Hess, dealer and branded retailer.
(b)	Company operated only.

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