Occidental Petroleum Corporation · NYSE:OXY
Occidental Petroleum — Q3 2006 Earnings Presentation
13 slides from Occidental Petroleum's earnings presentation, Oct 18, 2006
Slide 1: Third Quarter 2006 Earnings Conference Call
Third Quarter 2006 Earnings Conference Call October 18, 2006
Slide 2: Third Quarter 2006 Earnings - Highlights
Core Earnings - $1.159 Billion +15% year-over-year Core EPS $1.35 (diluted) Reported Net Income - $1.168 Billion Reported EPS $1.36 (diluted) Strong Performance driven by: Higher Oil Prices Higher Oil and Gas Volumes Improved Chemical Earnings Third Quarter 2006 Earnings - Highlights
Slide 3: Oil & Gas Segment Variance Analysis - 3Q06 vs. 3Q05
Core Earnings for 3Q06 of $1.877 Billion +15% year-over-year ($ in millions) 3Q 05 Sales Price Sales Volume/Mix Exploration Expense All Others 3Q 06 $1,647 $1,877 $273 $141 $23 $161 Third Quarter 2006 Earnings - Oil & Gas Segment Variance Analysis - 3Q06 vs. 3Q05
Slide 4: Oil & Gas Segment: Earnings and Realized Prices
3Q06 3Q05 Reported Segment Earnings ($ mm) $1,877 $1,638 WTI Oil Price ($/bbl) $70.53 $63.19 NYMEX Gas Price ($/mcf) $6.33 $7.09 Oxy’s Realized Prices Worldwide Oil ($/bbl) $60.52 $55.97 US Natural Gas (per mcf) $5.88 $6.33 Third Quarter 2006 Earnings - Oil & Gas Segment
Slide 5: Oil & Gas Segment: Production and Exploration Expense
3Q06 3Q05 Oil and Gas Production (mboe/day) 587 516 +14% year-over-year Production lower than projected due to: One less Libyan lifting (12 mboe/day) Maintenance at Horn Mountain, Qatar, and Argentina (6 mboe/day) Exploration Expense ($ mm) $74 $51 Third Quarter 2006 Earnings - Oil & Gas Segment
Slide 6: Chemical Segment Variance Analysis - 3Q06 vs. 3Q05
Core Earnings for 3Q06 of $247 Million +48% year-over-year 3Q 05 Sales Price Sales Volume/Mix Operations/ Manufacturing All Others 3Q 06 $167 $247 $83 $24 $23 $4 ($ in millions) Third Quarter 2006 Earnings – Chemical Segment Variance Analysis - 3Q06 vs. 3Q05
Slide 7: Nine Months Results
YTD2006 YTD2005 Core Income ($ mm) $3,514 $2,616 Core EPS (diluted) $4.07 $3.20 ROE* 26% ROCE* 22% Oil and Gas Earnings ($ mm) $5,740 $4,172 Oil and Gas production (mboe/day) 596 519 + 53 mboe/day from Vintage + 18 mboe/day from Libya WTI Oil Price ($/bbl) $68.24 $55.40 Oxy’s Worldwide Realized Oil
Slide 8: Nine Months Results: Costs, Chemical, Interest, Capex
Oil and Gas production costs increased by $2.32 per boe to $11.13 YTD 2006 vs. $8.81 per boe FY 2005 Approx. 45% of the increase was a result of higher energy prices. Remaining changes due to increased workover and maintenance. YTD2006 YTD2005 Chemical Core Earnings ($ mm) $745 $606 Improvement due
Slide 9: Third Quarter 2006 Earnings – Cash Flow YTD2006
$7,200 $1,000 $2,400 $2,000 $1,300 $610 $460 $30 $1,400 Available Cash Asset Sale Proceeds Acquisitions Capex Share Repurchase Reduction Dividends Other Ending Cash Balance Other Other ($ in millions) Debt Third Quarter 2006 Earnings – Cash Flow YTD2006 Beginning Cash $2,400 Flow From Cash Operation
Slide 10: Share Repurchase
Spent $1.3 Billion to Repurchase 26.7 mm shares YTD 2006 at an average price of $48.22 a share. Repurchased 6.6 mm shares in 3Q06 at an average price of $47.98 a share – 67% purchased during month of September. Shares Outstanding (mm) YTD2006 9/30/06 Weighted Average Basic 854.2 Weighted Average Dil
Slide 11: 4Q06 Outlook
Oil and Gas production of 610 to 620 mboe/day 9 mboe/day from recently acquired Plains properties; due to gas sales lag we will report approx. 7 mboe/day for 4Q. Two Libyan liftings scheduled total of 2 million barrels = 24 mboe/day. Commodity prices $1 per bbl change in oil prices impacts Oil & Gas
Slide 12: 4Q06 Outlook
Expect Chemical Earnings of $200 mm in 4Q and $945 mm FY2006. While slowdown has not yet occurred we expect that the typical seasonal slowdown will begin in November and carry through December. Expect Total Capex for 2006 of approximately $3 Billion. Oil & Gas accounting for more than 90 percent. In
Slide 13: Non-GAAP reconciliation and forward-looking statements
See the investor relations supplemental schedules for the reconciliation of non- GAAP items. Statements in this presentation that contain words such as "will", "expect" or "estimate", or otherwise relate to the future, are forward-looking and involve risks and uncertainties that could materially aff