Oil and natural gas company Murphy Oil Corp. (MUR) said Wednesday after the markets closed that it swung to a fourth quarter profit, helped mainly by lower impairment charges and income tax benefits tied to operating losses in two foreign countries.
Income from the company's exploration and production segment totaled $145.0 million in the fourth quarter, compared to a loss of $144.6 million in the fourth quarter of 2011.
The company attributed the improvement mainly to to a larger impairment charge in Republic of the Congo in 2011 and income tax benefits recognized in 2012 associated with operating losses in Republic of the Congo and Suriname.
Higher crude oil sales volumes and lower exploration expenses were mostly offset by lower oil and natural gas sales prices and higher overall extraction and administrative expenses, the company said.
The company's worldwide production rose 11% to 211,833 barrels of oil equivalent per day in the fourth quarter from 190.103 barrels of oil equivalent per day in the prior year quarter.
Crude oil, condensate and gas liquids production for the quarter rose to 132,918 barrels per day from 108,771 barrels per day a year earlier.
Natural gas sales volumes averaged 473 million cubic feet per day in the fourth quarter, down 3% from 488 million cubic feet per day in the year-ago quarter.
The average sales price for the company's crude oil, condensate and gas liquids was $92.82 per barrel in the fourth quarter, down from $96.67 per barrel last year. Natural gas sales prices in North America averaged $3.34 per thousand cubic feet in the fourth quarter, down from the $3.67 per MCF realized during the fourth quarter of last year.
The company's refining and marketing operations generated income from continuing operations of $38. million in the fourth quarter, a decrease of 37% from a year ago.
The El Dorado, Arkansas-based company reported net income for the fourth quarter of $158.7 million or $0.82 per share, compared to a net loss of $113.9 million or $0.59 per share for the year-ago quarter.
Income from continuing operations in the fourth quarter was $162.4 million or $0.84 per share, compared to a loss from continuing operations of $118.0 million or $0.61 per share in the prior year quarter.
The latest quarter results include total impairment charges of $261.0 million associated with both oil production operations in Republic of the Congo and ethanol production operations in Hereford, Texas. Income tax benefits in the upstream business totaled $108.3 million associated with tax deductions for operating losses in Republic of the Congo and Suriname. The year-ago quarter results included an impairment charge for Azurite of $368.6 million.
On average, 14 analysts polled by Thomson Reuters expected the company to earn $1.36 per share for the fourth quarter. Analysts' estimates typically exclude special items.
Revenue for the fourth quarter rose 9% to $7.39 billion from $6.79 billion in the same quarter last year. Four analysts had a consensus revenue estimate of $6.81 billion for the fourth quarter.
Last month, Murphy Oil entered into an agreement with Wal-Mart Stores Inc. (WMT) to build over 200 new fuel stations at existing Walmart supercenters. The construction program is expected to be completed over the next three years.
Looking forward, the company said it expects first quarter earnings from continuing operations to be in the range of $0.50 to $0.90 per share. Analysts currently expect the company to earn $1.30 per share for the first quarter.
The company also said it expects first quarter production to average 200,000 barrels of oil equivalent per day, but that it expects sales volumes of oil and natural gas for the quarter to average 202,000 barrels of oil equivalent per day.
Murphy Oil shares, which have traded in a range of $43.29 to $65.60 over the past year, closed Wednesday's regular trading session at $62.84, down 97 cents or 1.52%, but gained 39 cents or 0.62% in after hours trading.
by RTT Staff Writer
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