Anadarko Announces Strong First Quarter 2004 Earnings

Anadarko Petroleum Corporation (NYSE:APC) announced first quarter 2004 net income available to common shareholders of $392 million, or $1.55 per share (diluted), on revenues of $1.46 billion. Net income included a $40 million after-tax charge for an operating lease settlement related to a former UPR-owned refinery in Corpus Christi, Texas. Net income excluding this charge was $1.70 per share (diluted).(1) For the same period in 2003, net income before the cumulative effect of a change in accounting principle was $371 million, or $1.45 per share (diluted), on revenues of $1.26 billion. Including the accounting change, net income was $418 million, or $1.63 per share (diluted), in the 2003 first quarter.

"Strong volumes and favorable variances on expenses compared to our guidance, in addition to robust commodity prices, have us on track to deliver on the performance metrics we've laid out for shareholders this year," said Anadarko President and CEO Jim Hackett. "The resulting income and cash flows are providing the ability to fund our active capital program, improve returns, strengthen our balance sheet and achieve year-over-year growth."

Cash flow from operating activities totaled $885 million in the first quarter 2004, compared to $705 million for the first quarter 2003. Cash flow from operations before changes in assets and liabilities for the first quarter 2004 totaled $944 million, compared to $794 million for the first quarter 2003.

During the first quarter of 2004, sales volumes totaled 49 million barrels of oil equivalent (BOE), or 538,000 BOE per day, up 8 percent from 2003 first quarter sales volumes of 498,000 BOE per day.

Oil sales volumes in the first quarter were 202,000 barrels per day (bpd), compared to 173,000 bpd in the same quarter of 2003. The 17 percent increase is mainly attributed to the company's Algerian operations, due to the timing of cargo liftings and the expansion of production facilities and infrastructure. The company's average realized oil prices were $29.94 per barrel, compared with 2003 first quarter prices of $28.64 per barrel.

North American natural gas sales volumes of 1,723 million cubic feet (MMcf) per day rose 1 percent from first quarter 2003 volumes of 1,705 MMcf per day. Anadarko's average realized natural gas price in the first quarter of 2004 was $4.92 per thousand cubic feet (Mcf), compared with $4.60 per Mcf for the same period in 2003.