APA (APA) 8-K APA Corporation Announces Third-Quarter 2023

Exhibit 99.1

NEWS RELEASE   

APA Corporation Announces Third-Quarter 2023

Financial and Operational Results

Key Takeaways

• Reported production of 412,000 barrels of oil equivalent (BOE) per day; adjusted production, excluding Egypt noncontrolling interest and tax barrels, was 340,000 BOE per day;

• Year-over-year U.S. oil volumes increased 16% driven by operating efficiencies and strong well performance in the Permian Basin;

• Confirmed an estimated recoverable resource of 700 million barrels of oil at Sapakara and Krabdagu discoveries on Block 58, offshore Suriname;

• Generated net cash from operating activities of $764 million and free cash flow of $307 million during the quarter; and

• In the first three quarters of 2023, APA returned 65% of free cash flow to shareholders through dividends and buybacks, including the repurchase of 5.5 million shares at an average price of $37.91.

HOUSTON, Nov. 1, 2023 – APA Corporation (Nasdaq: APA) today announced its financial and operational results for the third quarter of 2023.

APA reported net income attributable to common stock of $459 million, or $1.49 per diluted share. When adjusted for items that impact the comparability of results, APA’s third-quarter earnings were $410 million, or $1.33 per diluted share. Net cash provided by operating activities was $764 million, and adjusted EBITDAX was $1.4 billion. The company generated $307 million in free cash flow during the quarter.

“Good execution and strong well performance in the Permian Basin were the primary drivers of APA’s third-quarter results,” said John J. Christmann IV, APA’s CEO and president. “Adjusted global oil production exceeded the high-end of our guidance range and was up by 20% year over year. In Suriname, our appraisal efforts delivered a very positive outcome, confirming estimated recoverable oil resources of 700 million barrels for Sapakara and Krabdagu.”

Third-Quarter Summary

Third-quarter reported production was 412,000 BOE per day. Adjusted production, excluding Egypt noncontrolling interest and tax barrels, was 340,000 BOE per day.

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APA CORPORATION ANNOUNCES THIRD-QUARTER 2023

FINANCIAL AND OPERATIONAL RESULTS — PAGE 2 of 5

APA delivered sequential quarterly oil growth in each of its operating areas. Total oil volumes increased by 5%, led by 10% growth in the U.S. In Egypt, gross oil production increased by 3%, and in the North Sea, oil production was up 2%.

In Suriname, APA’s partner TotalEnergies announced plans to proceed with Front End Engineering and Design (FEED) work for a 200,000 barrel per day FPSO. A considerable amount of planning, engineering and technical work is being directed toward this project, targeting Final Investment Decision (FID) before the end of 2024.

2023 Fourth-Quarter Capital and Production Guidance

The company expects total fourth-quarter production will be down slightly from the third quarter, due to facility downtime in the North Sea and a decline in natural gas volumes across the portfolio, as previously disclosed.

APA’s upstream capital investment in the fourth quarter is expected to be approximately $500 million. This reflects increased activity in the Permian Basin, where the company is picking up a sixth drilling rig.

ESG Progress

APA has made significant progress on its environmental, social and governance goals recently achieving a key 2023 target to convert more than 2,000 methane-emitting pneumatic devices to air driven or non-venting valves, thereby reducing methane emissions. This was delivered three months ahead of schedule and will result in an estimated annualized methane reduction of 1,000 tonnes or 25,000 tonnes of carbon dioxide equivalents.

Conference Call

APA will host a conference call to discuss its third-quarter 2023 results at 10 a.m. Central time, Thursday, Nov. 2. The conference call will be webcast from APA’s website at www.apacorp.com and investor.apacorp.com. Following the conference call, a replay will be available for one year on the “Investors” page of the company’s website.

APA CORPORATION ANNOUNCES THIRD-QUARTER 2023

FINANCIAL AND OPERATIONAL RESULTS — PAGE 3 of 5

About APA

APA Corporation owns consolidated subsidiaries that explore for and produce oil and natural gas in the United States, Egypt and the United Kingdom and that explore for oil and natural gas offshore Suriname and the Dominican Republic. APA posts announcements, operational updates, investor information and press releases on its website, www.apacorp.com. Additional details regarding Suriname, ESG performance and other investor-related topics are posted at investor.apacorp.com.

Additional Information

Additional information follows, including reconciliations of adjusted earnings, adjusted EBITDAX, upstream capital investment, net debt, cash flows from operations before changes in operating assets and liabilities and free cash flow (non-GAAP financial measures) to GAAP measures and information regarding adjusted production. APA’s quarterly supplement is available at http://www.apacorp.com/financialdata.

Non-GAAP Financial Measures

APA’s financial information includes information prepared in conformity with generally accepted accounting principles (GAAP) as well as non-GAAP financial information. It is management’s intent to provide non-GAAP financial information to enhance understanding of our consolidated financial information as prepared in accordance with GAAP. Adjusted earnings, adjusted EBITDAX, upstream capital investment, net debt, cash flows from operations before changes in operating assets and liabilities and free cash flow are non-GAAP measures. 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. Each non-GAAP financial measure is presented along with the corresponding GAAP measure so as not to imply that more emphasis should be placed on the non-GAAP measure.

APA CORPORATION ANNOUNCES THIRD-QUARTER 2023

FINANCIAL AND OPERATIONAL RESULTS — PAGE 4 of 5

Forward-Looking Statements

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. Forward-looking statements can be identified by words such as “anticipates,” “intends,” “plans,” “seeks,” “believes,” “continues,” “could,” “estimates,” “expects,” “goals,” “guidance,” “may,” “might,” “outlook,” “possibly,” “potential,” “projects,” “prospects,” “should,” “will,” “would,” and similar references to future periods, but the absence of these words does not mean that a statement is not forward-looking. These statements include, but are not limited to, statements about future plans, expectations, and objectives for operations, including statements about our capital plans, drilling plans, production expectations, asset sales, and monetizations. While forward-looking statements are based on assumptions and analyses made by us that we believe to be reasonable under the circumstances, whether actual results and developments will meet our expectations and predictions depend on a number of risks and uncertainties which could cause our actual results, performance, and financial condition to differ materially from our expectations. See “Risk Factors” in APA’s Form 10-K for the year ended December 31, 2022, and in our quarterly reports on Form 10-Q, filed with the Securities and Exchange Commission for a discussion of risk factors that affect our business. Any forward-looking statement made in this news release speaks only as of the date on which it is made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. APA and its subsidiaries undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future development or otherwise, except as may be required by law.

Cautionary Note to Investors

The United States Securities and Exchange Commission permits oil and gas companies, in their filings with the SEC, to disclose only proved, probable, and possible reserves that meet the SEC’s definitions for such terms. APA may use certain terms in this news release, such as “resources,” “potential resources,” “resource potential,” “estimated net reserves,” “recoverable reserves,” and other similar terms that the SEC guidelines strictly prohibit APA from including in filings with the SEC. Such terms do not take into account the certainty of resource recovery, which is contingent on exploration success, technical improvements in drilling access, commerciality, and other factors, and are therefore not indicative of expected future resource recovery and should not be relied upon. Investors are urged to consider carefully the disclosure in APA’s Annual Report on Form 10-K for the fiscal year ended Dec. 31, 2022 available from APA at www.apacorp.com or by writing APA at: 2000 Post Oak Blvd., Suite 100, Houston, TX 77056 (Attn: Corporate Secretary). You can also obtain this report from the SEC by calling 1-800-SEC-0330 or from the SEC’s website at www.sec.gov.

APA CORPORATION ANNOUNCES THIRD-QUARTER 2023

FINANCIAL AND OPERATIONAL RESULTS — PAGE 5 of 5

Contacts

Investor: (281) 302-2286 Gary Clark

Media:   (713) 296-7276 Alexandra Franceschi

Website: www.apacorp.com

Click here for the full release with quarterly financial statements.

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APA CORPORATION

STATEMENT OF CONSOLIDATED OPERATIONS

(Unaudited)

(In millions, except per share data)

	For the Quarter Ended September 30,						For the Nine Months Ended September 30,
	2023			2022			2023			2022
REVENUES AND OTHER:
Oil, natural gas, and natural gas liquids production revenues
Oil revenues	$	1,705		$	1,672		$	4,467		$	5,252
Natural gas revenues		236			428			658			1,241
Natural gas liquids revenues		138			202			375			654
		2,079			2,302			5,500			7,147
Purchased oil and gas sales		229			585			612			1,456
Total revenues		2,308			2,887			6,112			8,603
Derivative instrument gain (loss), net		—			(44	)		104			(138	)
Gain on divestitures, net		1			31			7			1,180
Other, net		—			(2	)		77			107
		2,309			2,872			6,300			9,752
OPERATING EXPENSES:
Lease operating expenses		394			364			1,076			1,067
Gathering, processing, and transmission		89			99			245			274
Purchased oil and gas costs		211			573			558			1,452
Taxes other than income		61			82			163			230
Exploration		49			95			144			193
General and administrative		139			69			276			314
Transaction, reorganization, and separation		5			4			11			21
Depreciation, depletion, and amortization:
Oil and gas property and equipment		407			300			1,086			847
Other assets		11			10			31			32
Asset retirement obligation accretion		29			29			86			87
Impairments		—			—			46			—
Financing costs, net		81			75			235			303
		1,476			1,700			3,957			4,820
NET INCOME BEFORE INCOME TAXES		833			1,172			2,343			4,932
Current income tax provision		422			357			1,022			1,164
Deferred income tax provision (benefit)		(144	)		285			(22	)		225
NET INCOME INCLUDING NONCONTROLLING INTERESTS		555			530			1,343			3,543
Net income attributable to noncontrolling interest - Egypt		96			108			261			368
Net income attributable to noncontrolling interest - Altus		—			—			—			14
Net loss attributable to Altus Preferred Unit limited partners		—			—			—			(70	)
NET INCOME ATTRIBUTABLE TO COMMON STOCK	$	459		$	422		$	1,082		$	3,231
NET INCOME PER COMMON SHARE:
Basic	$	1.49		$	1.28		$	3.50		$	9.54
Diluted	$	1.49		$	1.28		$	3.50		$	9.51
WEIGHTED-AVERAGE NUMBER OF COMMON SHARES OUTSTANDING:
Basic		308			329			309			339
Diluted		308			330			309			340
DIVIDENDS DECLARED PER COMMON SHARE	$	0.25		$	0.25		$	0.75			0.50

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APA CORPORATION

PRODUCTION INFORMATION

	For the Quarter Ended						% Change						For the Nine Months Ended
	September 30, 2023		June 30, 2023		September 30, 2022		3Q23 to 2Q23			3Q23 to 3Q22			September 30, 2023		September 30, 2022
OIL VOLUME - Barrels per day
United States		83,584		75,993		72,351		10	%		16	%		77,198		68,926
Egypt (1, 2)		88,521		87,790		81,095		1	%		9	%		88,038		83,857
North Sea		35,680		35,048		25,160		2	%		42	%		36,070		30,928
International (1)		124,201		122,838		106,255		1	%		17	%		124,108		114,785
Total (1)		207,785		198,831		178,606		5	%		16	%		201,306		183,711
NATURAL GAS VOLUME - Mcf per day
United States		454,643		450,200		489,107		1	%		-7	%		448,838		474,777
Egypt (1, 2)		300,326		337,413		318,945		-11	%		-6	%		331,158		350,400
North Sea		65,168		37,194		18,822		75	%		246	%		47,665		33,291
International (1)		365,494		374,607		337,767		-2	%		8	%		378,823		383,691
Total (1)		820,137		824,807		826,874		-1	%		-1	%		827,661		858,468
NGL VOLUME - Barrels per day
United States		66,280		61,760		64,958		7	%		2	%		61,418		61,990
Egypt (1, 2)		—		—		—		—			—			—		261
North Sea		1,497		872		558		72	%		168	%		1,209		1,080
International (1)		1,497		872		558		72	%		168	%		1,209		1,341
Total (1)		67,777		62,632		65,516		8	%		3	%		62,627		63,331
BOE per day
United States		225,639		212,786		218,826		6	%		3	%		213,423		210,045
Egypt (1, 2)		138,575		144,026		134,253		-4	%		3	%		143,231		142,518
North Sea		48,038		42,118		28,855		14	%		66	%		45,222		37,557
International (1)		186,613		186,144		163,108		0	%		14	%		188,453		180,075
Total (1)		412,252		398,930		381,934		3	%		8	%		401,876		390,120
Total excluding noncontrolling interests		366,051		350,864		337,093		4	%		9	%		354,094		342,584
(1) Includes net production volumes attributed to our noncontrolling partner in Egypt below:
Oil (b/d)		29,514		29,298		27,082								29,369		27,971
Gas (Mcf/d)		100,122		112,609		106,553								110,476		116,869
NGL (b/d)		—		—		—								—		87
BOE per day		46,201		48,066		44,841		-4	%		3	%		47,782		47,536
(2) Egypt Gross Production
Oil (b/d)		144,528		140,652		133,607								141,995		136,476
Gas (Mcf/d)		472,744		517,291		510,260								511,430		554,268
NGL (b/d)		—		—		0								—		397
BOE per day		223,319		226,867		218,650		-2	%		2	%		227,233		229,251

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APA CORPORATION

ADJUSTED PRODUCTION INFORMATION

Adjusted production excludes certain items that management believes affect the comparability of operating results for the periods presented. Adjusted production excludes production attributable to 1) noncontrolling interest in Egypt and 2) Egypt tax barrels. Management uses adjusted production to evaluate the company’s operational trends and performance and believes it is useful to investors and other third parties.

	For the Quarter Ended						% Change						For the Nine Months Ended
	September 30, 2023		June 30, 2023		September 30, 2022		3Q23 to 2Q23			3Q23 to 3Q22			September 30, 2023		September 30, 2022
OIL VOLUME - Barrels per day
United States		83,584		75,993		72,351		10	%		16	%		77,198		68,926
Egypt		42,535		43,085		37,584		-1	%		13	%		42,724		38,096
North Sea		35,680		35,048		25,160		2	%		42	%		36,070		30,928
International		78,215		78,133		62,744		0	%		25	%		78,794		69,024
Total		161,799		154,126		135,095		5	%		20	%		155,992		137,950
NATURAL GAS VOLUME - Mcf per day
United States		454,643		450,200		489,107		1	%		-7	%		448,838		474,777
Egypt		143,211		164,096		147,831		-13	%		-3	%		159,648		158,603
North Sea		65,168		37,194		18,822		75	%		246	%		47,665		33,291
International		208,379		201,290		166,653		4	%		25	%		207,313		191,894
Total		663,022		651,490		655,760		2	%		1	%		656,151		666,671
NGL VOLUME - Barrels per day
United States		66,280		61,760		64,958		7	%		2	%		61,418		61,990
Egypt		—		—		—		—			—			—		119
North Sea		1,497		872		558		72	%		168	%		1,209		1,080
International		1,497		872		558		72	%		168	%		1,209		1,199
Total		67,777		62,632		65,516		8	%		3	%		62,627		63,189
BOE per day
United States		225,639		212,786		218,826		6	%		3	%		213,423		210,045
Egypt		66,403		70,434		62,223		-6	%		7	%		69,332		64,649
North Sea		48,038		42,118		28,855		14	%		66	%		45,222		37,557
International		114,441		112,552		91,078		2	%		26	%		114,554		102,206
Total		340,080		325,338		309,904		5	%		10	%		327,977		312,251

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APA CORPORATION

PRICE INFORMATION

	For the Quarter Ended						For the Nine Months Ended
	September 30,		June 30,		September 30,		September 30,		September 30,
	2023		2023		2022		2023		2022
AVERAGE OIL PRICE PER BARREL
United States	$	82.33	$	73.99	$	94.62	$	77.40	$	100.06
Egypt		88.99		77.39		99.04		82.04		106.19
North Sea		87.70		79.27		101.85		83.25		105.59
International		88.57		77.90		99.84		82.41		106.02
Total		86.15		76.38		97.81		80.50		103.81
AVERAGE NATURAL GAS PRICE PER MCF
United States	$	2.12	$	1.24	$	6.67	$	1.87	$	5.89
Egypt		2.91		2.95		2.87		2.92		2.82
North Sea		10.98		11.29		24.12		12.83		24.59
International		4.36		3.78		4.13		4.15		4.59
Total		3.12		2.39		5.62		2.91		5.31
AVERAGE NGL PRICE PER BARREL
United States	$	21.87	$	18.26	$	32.97	$	21.24	$	36.36
Egypt		—		—		—		—		76.80
North Sea		42.78		39.24		70.42		47.58		72.86
International		42.78		39.24		70.42		47.58		73.40
Total		22.26		18.69		33.39		21.85		37.47

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APA CORPORATION

SUPPLEMENTAL FINANCIAL INFORMATION

(Unaudited)

(In millions)

SUMMARY EXPLORATION EXPENSE INFORMATION

	For the Quarter Ended September 30,				For the Nine Months Ended September 30,
	2023		2022		2023		2022
Unproved leasehold impairments	$	9	$	16	$	20	$	22
Dry hole expense		18		66		71		107
Geological and geophysical expense		1		1		3		19
Exploration overhead and other		21		12		50		45
	$	49	$	95	$	144	$	193

SUMMARY CASH FLOW INFORMATION

	For the Quarter Ended September 30,						For the Nine Months Ended September 30,
	2023			2022			2023			2022
Net cash provided by operating activities	$	764		$	1,104		$	2,099		$	3,530
Additions to upstream oil and gas property		(629	)		(431	)		(1,758	)		(1,198	)
Acquisition of Delaware Basin properties		(24	)		(563	)		(24	)		(563	)
Proceeds from sale of oil and gas properties		1			27			29			778
Proceeds from sale of Kinetik shares		—			—			—			224
Deconsolidation of Altus cash and cash equivalents		—			—			—			(143	)
Other, net		(15	)		57			(29	)		8
Net cash used in investing activities	$	(667	)	$	(910	)	$	(1,782	)	$	(894	)
Proceeds from (payments on) revolving credit facilities, net		6			245			202			(22	)
Payments on Apache fixed-rate debt		—			—			(65	)		(1,370	)
Distributions to noncontrolling interest - Egypt		(54	)		(78	)		(154	)		(237	)
Treasury stock activity, net		(20	)		(332	)		(208	)		(884	)
Dividends paid to APA common stockholders		(77	)		(41	)		(232	)		(127	)
Other		1			(2	)		(10	)		(30	)
Net cash used in financing activities	$	(144	)	$	(208	)	$	(467	)	$	(2,670	)

SUMMARY BALANCE SHEET INFORMATION

	September 30, 2023		December 31, 2022
Cash and cash equivalents	$	95	$	245
Other current assets		2,705		2,463
Property and equipment, net		9,500		9,012
Decommissioning security for sold Gulf of Mexico properties		38		217
Other assets		1,207		1,210
Total assets	$	13,545	$	13,147
Current debt	$	2	$	2
Current liabilities		2,633		2,914
Long-term debt		5,582		5,451
Decommissioning contingency for sold Gulf of Mexico properties		470		738
Deferred credits and other noncurrent liabilities		2,751		2,697
APA shareholders’ equity		1,078		423
Noncontrolling interest - Egypt		1,029		922
Total Liabilities and equity	$	13,545	$	13,147
Common shares outstanding at end of period		307		312

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APA CORPORATION

NON-GAAP FINANCIAL MEASURES

(In millions, except per share data)

Reconciliation of Costs incurred to Upstream capital investment

Management believes the presentation of upstream capital investments is useful for investors to assess APA’s expenditures related to our upstream capital activity. We define capital investments as costs incurred for oil and gas activities, adjusted to exclude property acquisitions, asset retirement obligation revisions and liabilities incurred, capitalized interest, and certain exploration expenses, while including amounts paid during the period for abandonment and decommissioning expenditures. Upstream capital expenditures attributable to a one-third noncontrolling interest in Egypt are also excluded. Management believes this provides a more accurate reflection of APA’s cash expenditures related to upstream capital activity and is consistent with how we plan our capital budget.

	For the Quarter Ended September 30,						For the Nine Months Ended September 30,
	2023			2022			2023			2022
Costs incurred in oil and gas property:
Asset and leasehold acquisitions
Proved	$	2		$	574		$	4		$	583
Unproved		1			34			11			51
Exploration and development		569			552			1,725			1,463
Total Costs incurred in oil and gas property	$	572		$	1,160		$	1,740		$	2,097
Reconciliation of Costs incurred to Upstream capital investment:
Total Costs incurred in oil and gas property	$	572		$	1,160		$	1,740		$	2,097
Property acquisitions		(1	)		(601	)		(1	)		(601	)
Asset retirement obligations settled vs. incurred - oil and gas property		7			10			20			24
Capitalized interest		(7	)		(5	)		(18	)		(13	)
Exploration seismic and administration costs		(22	)		(13	)		(53	)		(64	)
Upstream capital investment including noncontrolling interest - Egypt	$	549		$	551		$	1,688		$	1,443
Less noncontrolling interest - Egypt		(75	)		(59	)		(203	)		(162	)
Total Upstream capital investment	$	474		$	492		$	1,485		$	1,281

Reconciliation of Net cash provided by operating activities to Cash flows from operations before changes in operating assets and liabilities and Free cash flow

Cash flows from operations before changes in operating assets and liabilities and free cash flow are non-GAAP financial measures. APA uses these measures internally and provides this information because management believes it is useful in evaluating the company’s ability to generate cash to internally fund exploration and development activities, fund dividend programs, and service debt, as well as to compare our results from period to period. We believe these measures are also used by research analysts and investors to value and compare oil and gas exploration and production companies and are frequently included in published research reports when providing investment recommendations. Cash flows from operations before changes in operating assets and liabilities and free cash flow are additional measures of liquidity but are not measures of financial performance under GAAP and should not be considered as an alternative to cash flows from operating, investing, or financing activities. Additionally, this presentation of free cash flow may not be comparable to similar measures presented by other companies in our industry.

	For the Quarter Ended September 30,						For the Nine Months Ended September 30,
	2023			2022			2023			2022
Net cash provided by operating activities	$	764		$	1,104		$	2,099		$	3,530
Changes in operating assets and liabilities		161			134			440			248
Cash flows from operations before changes in operating assets and liabilities	$	925		$	1,238		$	2,539		$	3,778
Adjustments to free cash flow:
Upstream capital investment including noncontrolling interest - Egypt		(549	)		(551	)		(1,688	)		(1,443	)
Non oil and gas capital investment		(15	)		—			(24	)		—
Distributions to Sinopec noncontrolling interest		(54	)		(78	)		(154	)		(237	)
Upstream free cash flow	$	307		$	609		$	673		$	2,098

Reconciliation of Net cash provided by operating activities to Adjusted EBITDAX

Management believes EBITDAX, or earnings before income tax expense, interest expense, depreciation, amortization and exploration expense is a widely accepted financial indicator, and useful for investors, to assess a company’s ability to incur and service debt, fund capital expenditures, and make distributions to shareholders. We define adjusted EBITDAX, a non-GAAP financial measure, as EBITDAX adjusted for certain items presented in the accompanying reconciliation. Management uses adjusted EBITDAX to evaluate our ability to fund our capital expenditures, debt services and other operational requirements and to compare our results from period to period by eliminating the impact of certain items that management does not consider to be representative of the Company’s on-going operations. Management also believes adjusted EBITDAX facilitates investors and analysts in evaluating and comparing EBITDAX from period to period by eliminating differences caused by the existence and timing of certain operating expenses that would not otherwise be apparent on a GAAP basis. However, our presentation of adjusted EBITDAX may not be comparable to similar measures of other companies in our industry.

	For the Quarter Ended								For the Nine Months Ended
	September 30,			June 30,			September 30,		September 30,
	2023			2023			2022		2023		2022
Net cash provided by operating activities	$	764		$	1,000		$	1,104	$	2,099	$	3,530
Adjustments:
Exploration expense other than dry hole expense and unproved leasehold impairments		22			14			13		53		64
Current income tax provision		422			254			357		1,022		1,164
Other adjustments to reconcile net income (loss) to net cash provided by operating activities		(22	)		97			3		45		91
Changes in operating assets and liabilities		161			(232	)		134		440		248
Financing costs, net		81			82			75		244		236
Transaction, reorganization & separation costs		5			2			4		11		21
Adjusted EBITDAX (Non-GAAP)	$	1,433		$	1,217		$	1,690	$	3,914	$	5,354

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APA CORPORATION

NON-GAAP FINANCIAL MEASURES

(In millions)

Reconciliation of debt to net debt

Net debt, or outstanding debt obligations less cash and cash equivalents, is a non-GAAP financial measure. Management uses net debt as a measure of the Company’s outstanding debt obligations that would not be readily satisfied by its cash and cash equivalents on hand.

	September 30,		June 30,		March 31,		December 31,
	2023		2023		2023		2022
Current debt	$	2	$	2	$	2	$	2
Long-term debt		5,582		5,574		5,796		5,451
Total debt		5,584		5,576		5,798		5,453
Cash and cash equivalents		95		142		154		245
Net debt	$	5,489	$	5,434	$	5,644	$	5,208

Reconciliation of Income attributable to common stock to Adjusted earnings

Our presentation of adjusted earnings and adjusted earnings per share are non-GAAP measures because they exclude the effect of certain items included in Income Attributable to Common Stock. Management believes that adjusted earnings and adjusted earnings per share provides relevant and useful information, which is widely used by analysts, investors and competitors in our industry as well as by our management in assessing the Company’s operational trends and comparability of results to our peers.

Management uses adjusted earnings and adjusted earnings per share to evaluate our operating and financial performance because it eliminates the impact of certain items that management does not consider to be representative of the Company’s on-going business operations. As a performance measure, adjusted earnings may be useful to investors in facilitating comparisons to others in the Company’s industry because certain items can vary substantially in the oil and gas industry from company to company depending upon accounting methods, book value of assets, capital structure and asset sales and other divestitures, among other factors. Management believes excluding these items facilitates investors and analysts in evaluating and comparing the underlying operating and financial performance of our business from period to period by eliminating differences caused by the existence and timing of certain expense and income items that would not otherwise be apparent on a GAAP basis. However, our presentation of adjusted earnings and adjusted earnings per share may not be comparable to similar measures of other companies in our industry.

	For the Quarter Ended September 30, 2023												For the Quarter Ended September 30, 2022
	Before Tax			Tax Impact			After Tax			Diluted EPS			Before Tax			Tax Impact			After Tax			Diluted EPS
Net income including noncontrolling interests (GAAP)	$	833		$	(278	)	$	555		$	1.80		$	1,172		$	(642	)	$	530		$	1.61
Income attributable to noncontrolling interests		171			(75	)		96			0.31			193			(85	)		108			0.33
Net income attributable to common stock		662			(203	)		459			1.49			979			(557	)		422			1.28
Adjustments: *
Asset and unproved leasehold impairments		9			(6	)		3			0.01			16			(3	)		13			0.04
Noncontrolling interest & tax barrel impact on Egypt adjustments		—			—			—			—			1			(1	)		—			—
Valuation allowance and other tax adjustments		—			(93	)		(93	)		(0.30	)		—			183			183			0.56
Unrealized derivative instrument loss		19			(3	)		16			0.05			36			(8	)		28			0.08
Kinetik equity investment mark-to-market loss		28			(6	)		22			0.07			30			—			30			0.09
Transaction, reorganization & separation costs		5			(1	)		4			0.01			4			(2	)		2			0.01
Gain on divestitures, net		(1	)		—			(1	)		—			(31	)		6			(25	)		(0.08	)
Adjusted earnings (Non-GAAP)	$	722		$	(312	)	$	410		$	1.33		$	1,035		$	(382	)	$	653		$	1.98
	For the Nine Months Ended												For the Nine Months Ended
	September 30, 2023												September 30, 2022
	Before Tax			Tax Impact			After Tax			Diluted EPS			Before Tax			Tax Impact			After Tax			Diluted EPS
Net income including noncontrolling interests (GAAP)	$	2,343		$	(1,000	)	$	1,343		$	4.34		$	4,932		$	(1,389	)	$	3,543		$	10.43
Income attributable to noncontrolling interests		465			(204	)		261			0.84			671			(289	)		382			1.13
Loss attributable to Altus preferred unit limited partner		—			—			—			—			(70	)		—			(70	)		(0.21	)
Net income attributable to common stock		1,878			(796	)		1,082			3.50			4,331			(1,100	)		3,231			9.51
Adjustments: *
Asset and unproved leasehold impairments		66			(46	)		20			0.07			22			(4	)		18			0.05
Noncontrolling interest & tax barrel impact on Egypt adjustments		—			—			—			—			1			(2	)		(1	)		—
Valuation allowance and other tax adjustments **		—			7			7			0.02			—			(179	)		(179	)		(0.52	)
(Gain) / Loss on extinguishment of debt		(9	)		2			(7	)		(0.02	)		67			(14	)		53			0.15
Unrealized derivative instrument (gain) loss		(61	)		13			(48	)		(0.15	)		47			(18	)		29			0.08
Kinetik equity investment mark-to-market gain		(17	)		4			(13	)		(0.05	)		(23	)		—			(23	)		(0.06	)
Drilling contract termination charges		13			(10	)		3			0.01			—			—			—			—
Transaction, reorganization & separation costs		11			(3	)		8			0.02			21			(6	)		15			0.05
Gain on divestitures, net		(7	)		1			(6	)		(0.02	)		(1,180	)		125			(1,055	)		(3.11	)
Adjusted Earnings (Non-GAAP)	$	1,874		$	(828	)	$	1,046		$	3.38		$	3,286		$	(1,198	)	$	2,088		$	6.15

* The income tax effect of the reconciling items are calculated based on the statutory rate of the jurisdiction in which the discrete item resides.

** Includes $174 million related to the remeasurement of the December 31, 2022 U.K. deferred tax liability in connection with the Energy (Oil and Gas) Profits Levy Act 2022.

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