ConocoPhillips · NYSE:COP
ConocoPhillips — Q4 2015 Earnings Presentation
17 slides from ConocoPhillips's earnings presentation, Feb 4, 2016
Slide 1: 4Q15 Conference Call
4Q15 Conference Call Feb. 4, 2016
Slide 2: Cautionary Statement
Cautionary Statement The following presentation includes forward-looking statements. These statements relate to future events, such as anticipated revenues, earnings, business strategies, competitive position or other aspects of our operations, operating results or the industries or markets in which
Slide 3: Ryan Lance, Chairman & CEO
Ryan Lance Chairman & CEO
Slide 4: Market Environment: The World Has Changed
Market Environment: The World Has Changed Brent Price $/BBL Macro Environment $70 * Continued deterioration in near-term price outlook $60 * Supply/demand imbalance expected to last longer 2015 Average Price * Greater concern about global economic and oil demand growth $50 $40 External Factors $30 *
Slide 5: Exercising Further Flexibility, Maintaining Flat Production
Exercising Further Flexibility, Maintaining Flat Production Capital Production Operating Costs $3.7B REDUCTION 2015 LEVELS $1B REDUCTION $12 1,600 $8 1,500 1,400 $8 1,300 $7 $8.0B $7.7B $10.1B 1,200 $7.7B $7.0B $6.4B 1,100 $4 1,000 $6 2015 2016 (Dec 15) 2016E 2015 2016 (Dec 15) 2016E 2015 2016 (Dec
Slide 6: Setting a Sustainable Dividend for the Cycles
Setting a Sustainable Dividend for the Cycles Dividend level results in competitive yield Preserves balance sheet strength Provides financial flexibility through current cycle Lowers breakeven price Positions for the recovery; increases free cash flow Allows dividend growth as cash flow grows Source
Slide 7: Jeff Sheets, EVP, Finance and CFO
Jeff Sheets EVP, Finance and CFO
Slide 8: 2015 Summary
2015 Summary Strategic Operational Financial • Reduced capital • 5% full-year production • $1.7B adjusted loss; 2 expenditures 41% vs. 2014 growth $1.40 adjusted EPS loss • Achieved $2.2B of non- • Achieved first production • $7.6B cash from operations core disposition proceeds1 at Surmont 2 • Annou
Slide 9: 2015 Performance — Company Cash Flow
2015 Performance — Company Cash Flow B $ 2015 Marker Prices 2.4 * Brent $52.46/BBL * WTI $48.72/BBL C * Henry Hub $2.67/MMBTU 2.2 7.6 —_ Year-end 2015 | 1.0 10.1 * Debt of $24.9B * Debt-to-capital ratio of 38% _ ** 4 2015 Beginning CFO Excluding Total Working Disposition Debt Capital Dividends Other
Slide 10: Balance Sheet Strength Maintained
Balance Sheet Strength Maintained • Industry-wide credit downgrades expected Rating Agency • Debt capacity within a given rating level shrinking across the industry Review • Dividend reduction mitigates balance sheet usage • $8 billion of liquidity at year-end 2015 Liquidity • No significant near-te
Slide 11: Matt Fox, EVP, Exploration & Production
Matt Fox EVP, Exploration & Production
Slide 12: 2015 Reserve Replacement
2015 Reserve Replacement 86% 10% Organic (19%) Total replacement RRR RRR from additions so ae (75) | 8,906 8,296 r r r 1 YE 2014 2015 Additions Price Capital YE 2015 Acquisitions YE 2015 Reserves Production’ Reductions Reductions Organic and Reserves l Y ) Reserves Dispositions Market Factors
Slide 13: 2016 Operational Priorities
2016 Operational Priorities • Expect 2016 full-year production to be flat to 20151 SAFETY • 1Q16 production guidance: 1,540 to 1,580 MBOED REMAINS TOP PRIORITY • Alaska: Progress GMT 1 project and exploration around existing infrastructure $6.4B • Lower 48: Assess pilot results; prepare for future r
Slide 14: Q&A
Q&A
Slide 15: Appendix
Appendix
Slide 16: Annualized Net Income Sensitivities
Annualized Net Income Sensitivities • Crude • Brent/ANS: $100-120MM for $1/BBL change • WTI: $35-45MM for $1/BBL change • WCS¹: $35-45MM for $1/BBL change • North American NGL • Representative blend: $5-10MM for $1/BBL change • Natural Gas • Henry Hub: $75-85MM for $0.25/MCF change • International g
Slide 17: 2016 Outlook Guidance
2016 Outlook Guidance • 2016 DD&A of ~$8.5B • Reflects reduction in consolidated volumes • Operating Costs of ~$7.0B • Production and SG&A expense of ~$6.4B • Exploration G&A and G&G of ~$0.6B • Exploration Dry Hole and Impairment Expense of ~$0.8B • Corporate Segment Net Loss of ~$1B 17