LOS ANGELES, April 19, 2000 (PRIMEZONE) -- Occidental Petroleum Corporation (NYSE:OXY) announced net income of $271 million ($.74 per share) for the first quarter of 2000, compared with a net loss of $70 million ($.21 per share) for the first quarter of 1999.
Earnings before special items were $264 million for the first quarter of 2000, compared with a loss before special items of $68 million for the first quarter of 1999. Sales were $2.5 billion for the first quarter of 2000, compared with $1.3 billion for the same period in 1999.
Dr. Ray R. Irani, Chairman and Chief Executive Officer, said, "Our strong first quarter performance was driven by record quarterly profits from oil and gas and the strong recovery of our chemical business. This year's first quarter chemical earnings of $143 million virtually equaled the 1999 total year chemical earnings before special items of $147 million. The strong and growing demand for PVC throughout 1999 and into this year resulted in improved margins for chlorine and its derivatives. We expect continued strong performance from our chemical business.
"Higher oil and gas prices and continuing cost control contributed to the record quarterly earnings for oil and gas.
"Today we expect to announce the closing of the Altura transaction, and we expect to close on the THUMS acquisition during the second quarter. These events will materially strengthen our future performance. Specifically, worldwide oil and gas production volume will increase by 47% from the first quarter 2000 average daily production."
Oil and Gas
Oil and gas divisional earnings were $394 million for the first quarter of 2000, compared with $65 million for the first quarter of 1999, primarily as a result of higher worldwide crude oil and natural gas prices. Operating and overhead costs were also lower in 2000. However, lower production volumes, mainly resulting from the sale of our producing assets in Peru, partially offset the overall improvement in earnings from the prior year.
Chemicals
Chemical divisional earnings were $143 million for the first quarter of 2000, compared with $12 million for the first quarter of 1999, primarily due to higher prices and higher sales volume for VCM, EDC, PVC resins and chlorine. Partially offsetting these increases were higher raw material costs.
Other
Interest expense, net for the first quarter 2000 was $99 million, compared with $116 million for the first quarter of 1999, primarily due to the retirement of approximately $1 billion in debt in the second half of 1999.
Corporate other included insurance dividends of $11 million and $18 million for the first quarter of 2000 and 1999, respectively.
SUMMARY OF DIVISIONAL NET SALES AND EARNINGS
(Millions, except per-share amounts)
First Quarter
Periods Ended March 31 2000 1999
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DIVISIONAL NET SALES
Oil and gas $ 1,527 $ 746
Chemical 981 598
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Net sales $ 2,508 $ 1,344
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DIVISIONAL EARNINGS
Oil and gas $ 394 $ 65
Chemical 143 12
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537 77
Unallocated Corporate Items
Interest expense, net (99) (116)
Income taxes (a) (150) 3
Trust preferred distributions & other (17) (14)
Other - (7)
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Income (Loss) Before Effect Of
Changes In Accounting Principles 271 (57)
Cumulative effect of changes in accounting
principles, net (b) - (13)
------- -------
Net Income (Loss) 271 (70)
Effect of repurchase of Trust
Preferred Securities (c) 1 -
Preferred dividends - (4)
------- -------
EARNINGS (LOSS) APPLICABLE TO COMMON STOCK $ 272 $ (74)
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BASIC AND DILUTED EARNINGS (LOSS) PER
COMMON SHARE
Income (loss) before effect of
changes in accounting principles $ .74 $ (.17)
Cumulative effect of changes in
accounting principles, net (b) - (.04)
------- -------
$ .74 $ (.21)
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AVERAGE BASIC COMMON SHARES OUTSTANDING 368.1 347.8
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(a) Includes an offset for credits in lieu of U.S. federal income
taxes allocated to the divisions. Divisional earnings have
benefited from credits allocated by $1 million and $4 million at
oil and gas and chemical, respectively, in the first quarter of
2000 and by $2 million and $4 million at oil and gas and
chemical, respectively, in the first quarter of 1999.
(b) In 1999, reflects the adoption of SOP 98-5 "Reporting on the
Costs of Start-Up Activities" and EITF 98-10 "Accounting for
Contracts Involved in Energy Trading and Risk Management
Activities".
(c) The first quarter of 2000 includes a $1 million gain, net of
tax, related to the repurchase of 298,373 shares of 8.16 percent
Trust Preferred Securities.
SUMMARY OF OPERATING STATISTICS
First Quarter
Periods Ended March 31 2000 1999
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NET OIL, GAS AND LIQUIDS PRODUCTION PER DAY
United States
Crude oil and condensate (thousands of barrels) 61 66
Natural gas liquids (thousands of barrels) 9 9
Natural gas (millions of cubic feet) 630 647
Other Western Hemisphere
Crude oil and condensate (thousands of barrels) 52 102
Eastern Hemisphere
Crude oil and condensate (thousands of barrels) 117 144
Natural gas (millions of cubic feet) 50 53
CAPITAL EXPENDITURES (millions) $ 122 $ 132
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DEPRECIATION, DEPLETION AND
AMORTIZATION OF ASSETS (millions) $ 185 $ 197
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Contacts: Howard Collins (media)
310-443-6523
Kenneth J. Huffman (investors)
212-603-8183
On the web: www.oxy.com