EXHIBIT 99.1
CONTACTS:
(MEDIA): TONY LENTINI (713/296-6227)
BILL MINTZ (713/296-7276)
DAVID HIGGINS (713/296-6690)
(INVESTOR): ROBERT DYE (713/296-6662)
(WEB SITE): WWW.APACHECORP.COM
FOR RELEASE AT 7:45 A.M. CENTRAL TIME
APACHE REPORTS RECORD FIRST-QUARTER EARNINGS OF $1.06 PER SHARE
Houston, April 22, 2004 - Apache Corporation (NYSE, Nasdaq: APA) today
reported record first-quarter 2004 earnings of $348 million, or $1.06 per
diluted common share, up from the previous record established in the first
quarter of 2003 of $338 million, or $1.05 per share, which included $27 million,
or 8 cents per share, for the cumulative effect of a change in accounting
principle.
Apache's results benefited from a 23 percent increase in daily
production over the prior-year period and strong commodity prices. Apache's
per-share results have been adjusted to reflect the two-for-one common stock
split distributed in January 2004.
Cash from operations before changes in operating assets and liabilities
totaled $737 million, up from $645 million in the year-earlier period. (This is
a non-GAAP measure; see reconciliation below.)
Apache's debt-to-capitalization ratio declined to 24.2 percent at the
end of the quarter, from 26.3 percent at year-end 2003.
"Higher production and strong commodity prices drove our record
first-quarter financial results," said G. Steven Farris, president, chief
executive officer and chief operating officer.
Strong prices for oil and gas also are driving the acquisition market
for producing properties continually higher, Farris said. "We remain committed
to long-term profitable growth; although we are always looking for acquisitions
which have the potential to bring added value, in the current environment, we
intend to continue our active drilling program and to be patient.
-more-
Apache reports record first-quarter earnings - add one
"During the first quarter, we completed 422 wells worldwide compared to
just 156 a year ago. We were active in each of our core areas, and this activity
should benefit our financial results in future quarters," Farris said.
Apache's first-quarter production averaged 430,400 barrels of oil
equivalent (boe) per day, up from 348,600 boe per day in the prior-year period.
Liquid hydrocarbon production averaged 228,300 barrels per day, up 37 percent,
while natural gas production averaged 1.2 billion cubic feet per day, up 11
percent.
Apache received $30.44 per barrel of oil during the first quarter, down
slightly from $30.67 in the prior-year period; $23.83 per barrel for natural gas
liquids, compared with $24.42 per barrel; and $4.77 per thousand cubic feet
(Mcf) of gas, down from $5.29 per Mcf.
Apache Corporation is a large gas and oil independent with core
operations in the United States, Canada, Egypt, the United Kingdom North Sea and
Western Australia.
-end-
NOTE: Apache will webcast its conference call live at 1 p.m. Central
Time from its Web site, www.apachecorp.com. The replay will be available on the
Web site or by dialing (719) 457-0820 and using pass code 572225. The telephone
replay will be available for one week beginning at approximately 5 p.m. on April
22.
This news release contains certain "forward-looking statements" as
defined by the Private Securities Litigation Reform Act of 1995 including,
without limitation, expectations, beliefs, plans and objectives regarding
exploration and acquisition activities. Any matters that are not historical
facts are forward-looking and, accordingly, involve estimates, assumptions and
uncertainties. There is no assurance that Apache's expectations will be
realized, and actual results may differ materially from those expressed in the
forward-looking statements.
APACHE CORPORATION
FINANCIAL INFORMATION
(In thousands, except per share data)
<Table>
<Caption>
FOR THE QUARTER
ENDED MARCH 31,
------------------------------
2004 2003
------------ ------------
REVENUES AND OTHER:
Oil and gas production revenues $ 1,152,754 $ 975,162
Other (2,815) (8,553)
------------ ------------
Total revenues and other 1,149,939 966,609
------------ ------------
OPERATING EXPENSES:
Depreciation, depletion and amortization 286,228 214,349
Asset retirement obligation accretion 10,761 5,313
Lease operating costs 206,029 134,135
Gathering and transportation costs 19,634 11,861
Severance and other taxes 8,948 24,554
General and administrative 43,850 27,831
------------ ------------
Total operating expenses 575,450 418,043
------------ ------------
OPERATING INCOME 574,489 548,566
FINANCING COSTS:
Interest expense 40,549 37,696
Amortization of deferred loan costs 567 531
Capitalized interest (13,650) (11,232)
Interest income (320) (1,074)
------------ ------------
Net financing costs 27,146 25,921
------------ ------------
Preferred interests of subsidiaries -- 3,362
------------ ------------
INCOME BEFORE INCOME TAXES 547,343 519,283
Provision for income taxes 198,259 206,986
------------ ------------
INCOME BEFORE CHANGE IN ACCOUNTING PRINCIPLE 349,084 312,297
Cumulative effect of change in accounting principle, net of tax -- 26,632
------------ ------------
NET INCOME 349,084 338,929
Preferred stock dividends 1,420 1,420
------------ ------------
INCOME ATTRIBUTABLE TO COMMON STOCK $ 347,664 $ 337,509
============ ============
INCOME ATTRIBUTABLE TO COMMON STOCK
BEFORE CHANGE IN ACCOUNTING PRINCIPLE $ 347,664 $ 310,877
============ ============
BASIC NET INCOME PER COMMON SHARE
Before change in accounting principle $ 1.07 $ 0.98
============ ============
After change in accounting principle $ 1.07 $ 1.06
============ ============
DILUTED NET INCOME PER COMMON SHARE
Before change in accounting principle $ 1.06 $ 0.97
============ ============
After change in accounting principle $ 1.06 $ 1.05
============ ============
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING 325,003 318,509
============ ============
</Table>
APACHE CORPORATION
FINANCIAL INFORMATION
(In thousands)
<Table>
<Caption>
FOR THE QUARTER
ENDED MARCH 31,
--------------------------
2004 2003
---------- ----------
CAPITALIZED COSTS INCURRED:
North America exploration and development $ 350,523 $ 252,327
International exploration and development 164,074 89,949
---------- ----------
$ 514,597 $ 342,276
========== ==========
Acquisitions:
Oil and gas properties $ 1,329 $ 544,371
Gas gathering, transmission and processing facilities -- 5,484
---------- ----------
Total Acquisitions $ 1,329 $ 549,855
========== ==========
Asset retirement obligation activity, net $ (2,136) $ 69,693
Capitalized interest $ 13,650 $ 11,232
</Table>
<Table>
<Caption>
MARCH 31, DECEMBER 31,
2004 2003
------------ ------------
BALANCE SHEET DATA:
Current Assets $ 987,850 $ 899,072
Property and Equipment, net 11,532,356 11,260,085
Goodwill 189,252 189,252
Other Assets 76,252 67,717
------------ ------------
Total Assets $ 12,785,710 $ 12,416,126
============ ============
Current Liabilities $ 914,561 $ 820,378
Long-Term Debt 2,191,917 2,326,966
Deferred Credits and Other Noncurrent Liabilities 2,806,793 2,735,984
Shareholders' Equity 6,872,439 6,532,798
------------ ------------
Total Liabilities and Shareholders' Equity $ 12,785,710 $ 12,416,126
============ ============
Common shares outstanding at end of period 325,229 324,497
</Table>
NON-GAAP FINANCIAL MEASURES:
The press release discusses Apache's cash from operations before changes in
operating assets and liabilities. It is presented because management believes
the information is useful for investors because it is used internally and widely
accepted by those following the oil and gas industry as a financial indicator of
a company's ability to generate cash to internally fund exploration and
development activities, fund dividend programs, and service debt. It is also
used by research analysts to value and compare oil and gas exploration and
production companies, and is frequently included in published research when
providing investment recommendations. Cash from operations before changes in
operating assets and liabilities, therefore, is an additional measure of
liquidity, but is not a measure of financial performance under GAAP and should
not be considered as an alternative to cash flows from operating, investing, or
financing activities.
The following table reconciles net cash provided by operating activities to cash
from operations before changes in operating assets and liabilities.
<Table>
<Caption>
FOR THE QUARTER
ENDED MARCH 31,
-----------------------------
2004 2003
------------ ------------
Net cash provided by operating activities $ 652,332 $ 538,041
Changes in operating assets and liabilities 84,394 106,713
------------ ------------
Cash from operations before changes in
operating assets and liabilities $ 736,726 $ 644,754
============ ============
</Table>
APACHE CORPORATION
FINANCIAL INFORMATION
<Table>
<Caption>
FOR THE QUARTER
ENDED MARCH 31,
-----------------------------
2004 2003
------------ ------------
FINANCIAL DATA (In thousands, except per share data):
Revenues and other $ 1,149,939 $ 966,609
============ ============
Income Attributable to Common Stock $ 347,664 $ 337,509
============ ============
Basic Net Income Per Common Share:
Before change in accounting principle $ 1.07 $ 0.98
============ ============
After change in accounting principle $ 1.07 $ 1.06
============ ============
Diluted Net Income Per Common Share:
Before change in accounting principle $ 1.06 $ 0.97
============ ============
After change in accounting principle $ 1.06 $ 1.05
============ ============
Weighted Average Common Shares Outstanding 325,003 318,509
============ ============
Diluted Shares Outstanding 328,014 321,159
============ ============
PRODUCTION AND PRICING DATA:
NATURAL GAS VOLUME - Mcf PER DAY
United States 644,462 552,783
Canada 314,064 309,205
Egypt 128,665 123,719
Australia 118,822 101,153
North Sea 1,602 --
China -- --
Argentina 5,160 6,788
------------ ------------
Total 1,212,775 1,093,648
============ ============
AVERAGE NATURAL GAS PRICE PER MCF
United States $ 5.35 $ 6.22
Canada 5.09 5.35
Egypt 4.10 4.50
Australia 1.70 1.31
North Sea 4.34 --
China -- --
Argentina 0.47 0.42
Total 4.77 5.29
OIL VOLUME - BARRELS PER DAY
United States 67,255 57,334
Canada 25,266 24,735
Egypt 49,097 45,710
Australia 23,658 30,439
North Sea 44,299 --
China 7,440 --
Argentina 552 597
------------ ------------
Total 217,567 158,815
============ ============
AVERAGE OIL PRICE PER BARREL
United States $ 32.36 $ 28.97
Canada 33.00 32.09
Egypt 31.34 30.46
Australia 34.86 33.00
North Sea 22.72 --
China 30.12 --
Argentina 33.44 31.95
Total 30.44 30.67
NGL VOLUME - BARRELS PER DAY
United States 8,128 6,083
Canada 2,598 1,406
------------ ------------
Total 10,726 7,489
============ ============
AVERAGE NGL PRICE PER BARREL
United States $ 25.27 $ 24.34
Canada 19.34 24.75
Total 23.83 24.42
</Table>