HOUSTON, April 25, 2019 /PRNewswire/ -- Anadarko Petroleum Corporation (NYSE: APC) today announced 2019 first‑quarter results, reporting a net loss attributable to common stockholders of $15 million, or $0.03 per share (diluted). These results include certain items typically excluded by the investment community in published estimates. In total, these items decreased net income by $274 million, or $0.56 per share (diluted), on an after-tax basis.(1)

Anadarko generated $1.129 billion of cash flow from operations during the quarter, while capital expenditures totaled $1.030 billion, excluding Western Midstream Partners, LP (NYSE: WES). Additionally, the company reported discretionary cash flow from operations of $1.541 billion(2) and adjusted free cash flow of $381 million(2) for the quarter.

FIRST-QUARTER 2019 HIGHLIGHTS
Anadarko's first-quarter 2019 sales volume of oil, natural gas and natural gas liquids (NGLs) totaled 64 million barrels of oil equivalent (BOE), or an average of 715,000 BOE per day, which included 412,000 barrels of oil per day (BOPD).

Anadarko's U.S. onshore assets averaged sales volume of 465,000 BOE per day during the first quarter of 2019, which included 195,000 BOPD. Anadarko's Gulf of Mexico averaged a record 166,000 BOE per day in the quarter, which included 138,000 BOPD. Internationally, the company averaged 84,000 BOE per day during the first quarter, which included 79,000 BOPD.

The company also continued to make significant progress with its Mozambique LNG project, announcing Sale and Purchase Agreements (SPAs) now totaling more than 9.5 million tonnes per annum (MTPA), with two additional SPAs in the final stages of execution that, if executed, would bring the total volume to more than 11 MTPA. During the quarter, the project also was designated as the first mover by the Government of Mozambique for the marine facilities to support the onshore LNG industry in Mozambique. The company remains positioned to take a final investment decision (FID) during the first half of this year.

FINANCIAL DATA
Nine pages of summary financial data follow, including current hedge positions and a reconciliation of "divestiture-adjusted" or "same-store" sales.

(1)

See the accompanying table for details of certain items affecting comparability.

(2)

See the accompanying table for a reconciliation of GAAP to non-GAAP financial measures and a statement indicating why management believes the non-GAAP financial measures provide useful information for investors.

Anadarko Petroleum Corporation's mission is to deliver a competitive and sustainable rate of return to shareholders by exploring for, acquiring and developing oil and natural gas resources vital to the world's health and welfare. As of year-end 2018, the company had 1.47 billion barrels-equivalent of proved reserves, making it one of the world's largest independent exploration and production companies. For more information about Anadarko and APC Flash Feed updates, please visit www.anadarko.com.

This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Anadarko believes that its expectations are based on reasonable assumptions. No assurance, however, can be given that such expectations will prove to have been correct. A number of factors could cause actual results to differ materially from the projections, anticipated results or other expectations expressed in this news release, including Anadarko's ability to successfully plan, secure additional government and partner approvals, enter into the additional long-term sales contracts identified in this release, take FID and the timing thereof, finance, build, and operate the necessary infrastructure and LNG park in Mozambique. See "Risk Factors" in the company's 2018 Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other public filings and press releases. Anadarko undertakes no obligation to publicly update or revise any forward-looking statements.

Anadarko Contacts

INVESTORS:
Mike Pearl, mike.pearl@anadarko.com, 832.636.3271
Kyle Deakins, kyle.deakins@anadarko.com, 832.636.2354
Jon VandenBrand, jon.vandenbrand@anadarko.com, 832.636.1007

MEDIA:
John Christiansen, john.christiansen@anadarko.com, 832.636.8736
Stephanie Moreland, stephanie.moreland@anadarko.com, 832.636.2912

Anadarko Petroleum Corporation
Reconciliation of GAAP to Non-GAAP Financial Measures

Below are reconciliations of certain GAAP to non-GAAP financial measures, each as required under Regulation G of the Securities Exchange Act of 1934. This non-GAAP information should be considered by the reader in addition to, but not instead of, the financial statements prepared in accordance with GAAP. The non-GAAP financial information presented may be determined or calculated differently by other companies and may not be comparable to similarly titled measures.

Management uses adjusted net income (loss) to evaluate operating and financial performance and believes the measure is useful to investors because it eliminates the impact of certain noncash and/or other items that management does not consider to be indicative of the Company's performance from period to period. Management also believes this non-GAAP measure is useful to investors to evaluate and compare the Company's operating and financial performance across periods, as well as facilitating comparisons to others in the Company's industry.



Quarter Ended March 31, 2019



Before


After


Per Share

millions except per-share amounts


Tax


Tax


(diluted)

Net income (loss) attributable to common stockholders (GAAP)




$

(15)



$

(0.03)


Adjustments for certain items affecting comparability







Total gains (losses) on derivatives, net, less net cash from settlement of commodity derivatives (after noncontrolling interest)*


$

(300)



(232)



(0.47)


Gains (losses) on divestitures, net


(5)



(4)



(0.01)


Contingency accruals


(9)



(7)



(0.01)


Reorganization-related charges


(19)



(15)



(0.04)


Change in uncertain tax positions




(16)



(0.03)


Certain items affecting comparability


$

(333)



(274)



(0.56)


Adjusted net income (loss) (Non-GAAP)




$

259



$

0.53




*

Includes $(155) million related to commodity derivatives, $(148) million related to interest-rate derivatives (after noncontrolling interest) and $3 million related to gathering, processing, and marketing sales.

 



Quarter Ended March 31, 2018



Before


After


Per Share

millions except per-share amounts


Tax


Tax


(diluted)

Net income (loss) attributable to common stockholders (GAAP)




$

121



$

0.22


Adjustments for certain items affecting comparability







Total gains (losses) on derivatives, net, less net cash from settlement of commodity derivatives*


$

27



21



0.04


Gains (losses) on divestitures, net


(24)



(17)



(0.03)


Impairments







Producing properties


(19)



(15)



(0.03)


Exploration assets


(53)



(41)



(0.08)


Contingency accruals


(132)



(101)



(0.19)


Change in uncertain tax positions




(5)



(0.01)


Certain items affecting comparability


$

(201)



(158)



(0.30)


Adjusted net income (loss) (Non-GAAP)




$

279



$

0.52




*

Includes $(94) million related to commodity derivatives, $127 million related to interest-rate derivatives, and $(6) million related to gathering, processing, and marketing sales.

Anadarko Petroleum Corporation
Reconciliation of GAAP to Non-GAAP Measures

Management believes that the presentation of Adjusted EBITDAX (Margin) provides information useful in assessing the Company's operating and financial performance across periods.


Quarter Ended March 31,

millions

2019


2018

Net income (loss) attributable to common stockholders (GAAP)

$

(15)



$

121


Interest expense

253



228


Income tax expense (benefit)

166



126


Depreciation, depletion, and amortization

1,081



990


Exploration expense*

49



168


(Gains) losses on divestitures, net

5



24


Impairments

—



19


Total (gains) losses on derivatives, net, less net cash from settlement of commodity derivatives

316



(27)


Reorganization-related charges

18



—


Consolidated Adjusted EBITDAX (Margin) (Non-GAAP)

$

1,873



$

1,649


Total barrels of oil equivalent (MMBOE)

64



58


Consolidated Adjusted EBITDAX (Margin) per BOE

$

29.27



$

28.43




*

Includes reorganization-related charges of $1 million for the three months ended March 31, 2019.

Management uses net debt to determine the Company's outstanding debt obligations that would not be readily satisfied by its cash and cash equivalents on hand. Management believes that using net debt in the capitalization ratio is useful to investors in determining the Company's leverage since the Company could choose to use its cash and cash equivalents to retire debt. In addition, management believes that presenting Anadarko's net debt excluding WES is useful because WES is a separate public company with its own capital structure.




March 31, 2019








Anadarko




Anadarko


WES*


excluding

millions



Consolidated


Consolidated


WES

Total debt (GAAP)



$

17,924



$

7,208



$

10,716


Less cash and cash equivalents



2,026



100



1,926


Net debt (Non-GAAP)



$

15,898



$

7,108



$

8,790

















Anadarko






Anadarko


excluding

millions





Consolidated


WES

Net debt





$

15,898



$

8,790


Total equity





10,533



8,928


Adjusted capitalization





$

26,431



$

17,718














Net debt to adjusted capitalization ratio






60

%



50

%



*

Western Midstream Partners, LP (WES) is a publicly traded consolidated subsidiary of Anadarko.

Anadarko Petroleum Corporation
Reconciliation of GAAP to Non-GAAP Measures

Management uses Discretionary Cash Flow from Operations (DCF), Free Cash Flow (FCF), Adjusted DCF, and Adjusted FCF to determine the company's ability to internally fund its capital expenditures and to service or incur additional debt. These measures eliminate the impact of certain items that management does not consider to be indicative of the Company's performance from period to period. To assist in measuring the Company's performance, management will also evaluate Anadarko on a deconsolidated basis, which excludes WES.

Discretionary Cash Flow from Operations and Free Cash Flow


Quarter Ended


March 31,

millions

2019


2018

Net cash provided by (used in) operating activities (GAAP)

$

1,129



$

1,430


Add back




Increase (decrease) in accounts receivable

39



(23)


(Increase) decrease in accounts payable and other current liabilities

294



(45)


Other items, net

79



40


Discretionary cash flow from operations (Non-GAAP)

$

1,541



$

1,402


Less




APC capital expenditures*

1,030



1,374


WES capital expenditures

266



330


Free cash flow (Non-GAAP)

$

245



$

(302)




*

APC capital expenditures include $49 million at March 31, 2019, and $258 million at March 31, 2018, of midstream capitalized costs incurred by Anadarko prior to the contribution and sale of its midstream assets to WES.

Adjusted Discretionary Cash Flow from Operations and Adjusted Free Cash Flow


Quarter Ended


March 31,

millions

2019


2018

Net cash provided by (used in) operating activities (GAAP)

$

1,129



$

1,430


Adjusted by:




Increase (decrease) in accounts receivable

39



(23)


(Increase) decrease in accounts payable and other current liabilities

294



(45)


Other items, net

79



40


WES distributions to third parties

(130)



(118)


Adjusted discretionary cash flow from operations (Non-GAAP)

$

1,411



$

1,284


Less APC capital expenditures (excludes WES)*

1,030



1,374


Adjusted free cash flow (Non-GAAP)

$

381



$

(90)




*

APC capital expenditures include $49 million at March 31, 2019, and $258 million at March 31, 2018, of midstream capitalized costs incurred by Anadarko prior to the contribution and sale of its midstream assets to WES.

 

Anadarko Petroleum Corporation

Cash Flow Information

(Unaudited)



Quarter Ended


March 31,

millions

2019


2018

Cash Flows from Operating Activities




Net income (loss)

$

96



$

174


Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities




Depreciation, depletion, and amortization

1,081



990


Deferred income taxes

1



42


Dry hole expense and impairments of unproved properties

—



106


Impairments

—



19


(Gains) losses on divestitures, net

5



24


Total (gains) losses on derivatives, net

315



36


Operating portion of net cash received (paid) in settlement of derivative instruments

1



(63)


Other

42



74


Changes in assets and liabilities

(412)



28


Net Cash Provided by (Used in) Operating Activities

$

1,129



$

1,430


Net Cash Provided by (Used in) Investing Activities

$

(1,528)



$

(1,113)


Net Cash Provided by (Used in) Financing Activities

$

1,129



$

(1,507)


 

Anadarko Petroleum Corporation

(Unaudited)



Quarter Ended

Summary Financial Information

March 31,

millions except per-share amounts

2019


2018

Consolidated Statements of Income




Revenues and Other




Oil sales

$

2,096



$

2,127


Natural-gas sales

320



247


Natural-gas liquids sales

240



292


Gathering, processing, and marketing sales

470



360


Gains (losses) on divestitures and other, net

92



19


Total

3,218



3,045


Costs and Expenses




Oil and gas operating

289



276


Oil and gas transportation

222



196


Exploration

49



168


Gathering, processing, and marketing

256



237


General and administrative

267



278


Depreciation, depletion, and amortization

1,081



990


Production, property, and other taxes

199



190


Impairments

—



19


Other operating expense

21



140


Total

2,384



2,494


Operating Income (Loss)

834



551


Other (Income) Expense




Interest expense

253



228


(Gains) losses on derivatives, net

313



35


Other (income) expense, net

6



(12)


Total

572



251


Income (Loss) Before Income Taxes

262



300


Income tax expense (benefit)

166



126


Net Income (Loss)

96



174


Net income (loss) attributable to noncontrolling interests

111



53


Net Income (Loss) Attributable to Common Stockholders

$

(15)



$

121


Per Common Share




Net income (loss) attributable to common stockholders—basic

$

(0.03)



$

0.23


Net income (loss) attributable to common stockholders—diluted

$

(0.03)



$

0.22


Average Number of Common Shares Outstanding—Basic

490



518


Average Number of Common Shares Outstanding—Diluted

490



519






Exploration Expense




Dry hole expense

$

—



$

53


Impairments of unproved properties

—



53


Geological and geophysical, exploration overhead, and other expense

49



62


Total

$

49



$

168


 

Anadarko Petroleum Corporation

(Unaudited)



March 31,


December 31,

millions

2019


2018

Condensed Balance Sheets




Cash and cash equivalents

$

2,026



$

1,295


Accounts receivable, net of allowance

2,065



2,026


Other current assets

338



474


Net properties and equipment

28,936



28,615


Other assets

3,006



2,336


Goodwill and other intangible assets

5,622



5,630


Total Assets

$

41,993



$

40,376


Short-term debt - Anadarko*

21



919


Short-term debt - WES

2,000



28


Other current liabilities

3,728



3,711


Long-term debt - Anadarko*

10,695



10,683


Long-term debt - WES

5,208



4,787


Deferred income taxes

2,624



2,437


Asset retirement obligations

2,876



2,847


Other long-term liabilities

4,308



4,021


Common stock

57



57


Paid-in capital

13,057



12,393


Retained earnings

1,024



1,245


Treasury stock

(4,881)



(4,864)


Accumulated other comprehensive income (loss)

(329)



(335)


Total stockholders' equity

8,928



8,496


Noncontrolling interests

1,605



2,447


Total Equity

10,533



10,943


Total Liabilities and Equity

$

41,993



$

40,376


Capitalization




Total debt

$

17,924



$

16,417


Total equity

10,533



10,943


Total

$

28,457



$

27,360










Capitalization Ratios








Total debt


63

%



60

%

Total equity


37

%



40

%



*

Excludes WES

 

Anadarko Petroleum Corporation

(Unaudited)


Sales Volume and Prices



















Average Daily Sales Volume


Sales Volume


Average Sales Price


Oil


Natural Gas


NGLs


Oil


Natural Gas


NGLs


Oil


Natural Gas


NGLs


MBbls/d


MMcf/d


MBbls/d


MMBbls


Bcf


MMBbls


Per Bbl


Per Mcf


Per Bbl

Quarter Ended March 31, 2019


















United States

333



1,150



106



29



104



10



$

55.14



$

3.09



$

23.54


Algeria

61



—



5



6



—



—



61.49



—



35.01


Other International

18



1



—



2



—



—



65.04



0.65



—


Total

412



1,151



111



37



104



10



$

56.51



$

3.09



$

24.11




















Quarter Ended March 31, 2018


















United States

288



1,051



92



25



95



9



$

62.58



$

2.61



$

33.24


Algeria

55



—



5



5



—



—



67.24



—



40.76


Other International

28



—



—



3



—



—



67.68



—



—


Total

371



1,051



97



33



95



9



$

63.66



$

2.61



$

33.63







































Average Daily Sales Volume
 MBOE/d


Sales Volume
 MMBOE





























Quarter Ended March 31, 2019

715


64











Quarter Ended March 31, 2018

643


58





























 

Sales Revenue and Commodity Derivatives









Sales



Net Cash Received (Paid) from Settlement of Commodity
Derivatives

millions

Oil


Natural Gas


NGLs



Oil


Natural Gas


NGLs

Quarter Ended March 31, 2019













United States

$

1,654



$

320



$

223




$

6



$

—



$

—


Algeria

333



—



17




—



—



—


Other International

109



—



—




—



—



—


Total

$

2,096



$

320



$

240




$

6



$

—



$

—















Quarter Ended March 31, 2018













United States

$

1,623



$

247



$

274




$

(67)



$

(1)



$

—


Algeria

331



—



18




—



—



—


Other International

173



—



—




—



—



—


Total

$

2,127



$

247



$

292




$

(67)



$

(1)



$

—


 

Anadarko Petroleum Corporation

Commodity Hedge Positions

As of April 25, 2019
















Weighted Average Price per barrel




Volume
 (MBbls/d)


Floor Sold


Floor Purchased


Ceiling Sold

Oil









Three-Way Collars








2019









WTI


57

$

45.00

$

55.00

$

70.22


Brent


30

$

50.00

$

60.00

$

78.22




87







 







Interest-Rate Derivatives

As of April 25, 2019







Instrument

Notional Amt.

Reference Period

Mandatory

Termination Date

Rate Paid

Rate Received

Anadarko






Swap

$550 Million

September 2016 - 2046

September 2020

6.418%

3M LIBOR

Swap

$250 Million

September 2016 - 2046

September 2022

6.809%

3M LIBOR

Swap

$100 Million

September 2017 - 2047

September 2020

6.891%

3M LIBOR

Swap

$250 Million

September 2017 - 2047

September 2021

6.570%

3M LIBOR

Swap

$450 Million

September 2017 - 2047

September 2023

6.445%

3M LIBOR

WES






Swap

$375 Million

December 2019 - 2024

December 2019

2.662%

3M LIBOR

Swap

$375 Million

December 2019 - 2029

December 2019

2.802%

3M LIBOR

Swap

$375 Million

December 2019 - 2049

December 2019

2.885%

3M LIBOR

 

Anadarko Petroleum Corporation

Reconciliation of Same-Store Sales


Average Daily Sales Volume


Quarter Ended March 31, 2019


Quarter Ended March 31, 2018


Oil

MBbls/d


Natural Gas

MMcf/d


NGLs

MBbls/d


Total

MBOE/d


Oil

MBbls/d


Natural Gas

MMcf/d


NGLs

MBbls/d


Total

MBOE/d

U.S. Onshore

195



1,051



94



465



156



969



83



400


Gulf of Mexico

138



97



12



166



126



78



9



148


International

79



1



5



84



83



—



5



88


Same-Store Sales

412



1,149



111



715



365



1,047



97



636


Divestitures*

—



2



—



—



6



4



—



7


Total

412



1,151



111



715



371



1,051



97



643




*

Includes Ram Powell and Alaska.

 

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SOURCE Anadarko Petroleum Corporation