UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported): April 30, 2014
HESS CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
| DELAWARE | No. 1-1204 | No. 13-4921002 |
| (State or Other | (Commission | (IRS Employer |
| Jurisdiction of | File Number) | Identification No.) |
|
Incorporation)
|
1185 Avenue of the Americas
New York, New York 10036
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code: (212) 997-8500
N/A
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| o |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
|
| o |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
|
| o |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
|
| o |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 2.02. Results of Operations and Financial Condition.
On April 30, 2014, Hess Corporation issued a news release reporting estimated results for the first quarter of 2014. A copy of this news release is attached hereto as Exhibit 99(1) and is hereby incorporated by reference.
Item 9.01. Financial Statements and Exhibits.
| (c) |
Exhibit
|
|
99(1) News release dated April 30, 2014 reporting estimated results for the first quarter of 2014.
|
2
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: April 30, 2014
| HESS CORPORATION | |||
| By: |
/s/John P. Rielly
|
||
| Name: |
John P. Rielly
|
||
| Title: |
Senior Vice President and
|
||
|
Chief Financial Officer
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|||
3
EXHIBIT INDEX
| Exhibit No. |
Description
|
| 99(1) |
News release dated April 30, 2014 reporting estimated results for the first quarter of 2014.
|
4
 |
Exhibit 99(1)
HESS CORPORATION
|
News Release
HESS REPORTS ESTIMATED RESULTS FOR THE FIRST QUARTER OF 2014
First Quarter Highlights:
|
●
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Net income was $386 million, compared to $1,276 million in the first quarter of 2013
|
|
●
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Adjusted earnings were $446 million or $1.38 per share
|
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●
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Cash flow from operations before working capital changes was $1.41 billion in the first quarter of 2014
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●
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Oil and gas production was 318,000 barrels of oil equivalent per day (boepd) in the first quarter and 389,000 boepd in the year-ago quarter. Pro forma production, excluding Libya, was 297,000 boepd in the first quarter of 2014, up 11 percent from 268,000 boepd in 2013
|
|
●
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The Tioga gas plant expansion project commenced start-up operations with first gas in late March
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●
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The Corporation purchased 12.6 million common shares during the first quarter, for a cost of approximately $1.0 billion, bringing total shares repurchased under the program to 31.9 million for a total cost of approximately $2.54 billion
|
NEW YORK, April 30, 2014 -- Hess Corporation (NYSE: HES) today reported net income of $386 million for the quarter ended March 31, 2014. Adjusted earnings, which exclude items affecting comparability, were $446 million or $1.38 per common share, compared with $669 million or $1.95 per share in the prior year quarter. The decrease in adjusted earnings was primarily due to the impact on operating earnings related to divesting E&P assets and downstream businesses.
1
After-tax income (loss) by major operating activity was as follows:
|
Three Months Ended
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||||||||
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March 31, (unaudited)
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||||||||
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2014
|
2013
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|||||||
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(In millions,
|
||||||||
|
except per share amounts)
|
||||||||
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Net Income (Loss) Attributable to Hess Corporation
|
||||||||
|
Exploration and Production
|
$ | 508 | $ | 1,286 | ||||
|
Corporate and Interest
|
(89 | ) | (109 | ) | ||||
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Downstream Businesses
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(33 | ) | 99 | |||||
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Net income attributable to Hess Corporation
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$ | 386 | $ | 1,276 | ||||
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Net income per share (diluted)
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$ | 1.20 | $ | 3.72 | ||||
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Adjusted Earnings (Losses)
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||||||||
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Exploration and Production
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$ | 514 | $ | 698 | ||||
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Corporate and Interest
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(81 | ) | (98 | ) | ||||
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Downstream Businesses
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13 | 69 | ||||||
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Adjusted earnings attributable to Hess Corporation
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$ | 446 | $ | 669 | ||||
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Adjusted earnings per share (diluted)
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$ | 1.38 | $ | 1.95 | ||||
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Weighted average number of shares (diluted)
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322.6 | 342.6 | ||||||
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Note: See page 6 for a table of items affecting comparability of earnings between periods.
|
||||||||
John Hess, Chief Executive Officer of Hess, said: “Our results this quarter demonstrate continued execution of our plan to drive cash-generative growth and sustainable returns for our shareholders through a focused portfolio of world-class E&P assets. In the first quarter, our growth assets performed well, with higher production from Valhall and North Malay Basin. In addition, current Bakken production levels are in excess of 80,000 barrels of oil equivalent per day following completion of the Tioga gas plant expansion. Tubular Bells is on track for first oil in the third quarter and well results from the Utica shale play are encouraging. Overall, we remain very enthusiastic about the prospects for our company in 2014 and beyond.”
Exploration and Production:
Exploration and Production earnings were $508 million in the first quarter of 2014, compared with $1,286 million in the first quarter of 2013. Adjusted earnings were $514 million in the first quarter of 2014 and $698 million in the first quarter of 2013.
2
Oil and gas production was 318,000 boepd in the first quarter of 2014 and 389,000 in the year-ago quarter. Asset sales lowered production by 77,000 boepd, while extended shutdowns caused by civil unrest in Libya reduced production by approximately 23,000 boepd versus the year-ago quarter. Production from the Valhall Field offshore Norway was 37,000 boepd, an increase of 32,000 boepd from the prior year quarter, which was impacted by a redevelopment project. The Corporation’s average worldwide crude oil selling price, including the effect of hedging, was $99.17 per barrel, up from $94.50 per barrel in the same quarter a year ago. The average worldwide natural gas selling price was $7.03 per mcf in the first quarter of 2014, up from $6.62 per mcf in the first quarter a year ago.
Excluding production from Libya and assets sold and classified as held-for-sale, pro forma production was 297,000 boepd in the first quarter of 2014, an increase of 11 percent from 268,000 boepd in the first quarter of 2013. The Corporation still expects production, excluding Libya and asset sales, to average between 305,000 boepd and 315,000 boepd in 2014 driven by continued growth in the Bakken, higher production from the Valhall Field post completion of the redevelopment project in 2013, and the planned start-up of the Tubular Bells Field in the Gulf of Mexico in the third quarter of 2014.
Operational Highlights:
Bakken (Onshore U.S.): Production in the Bakken was curtailed in the first quarter, primarily due to the shutdown of the Tioga gas plant to complete the expansion project. The Corporation’s net production averaged 63,000 boepd. Hess brought 30 operated wells on production in the quarter, and drilling and completion costs per operated well averaged $7.5 million. The Tioga gas plant expansion project was completed in the first quarter of 2014 with start-up operations commencing in late March. The gas plant is now operational and Bakken production levels are in excess of 80,000 boepd.
Utica (Onshore U.S.): In the first quarter of 2014, the Corporation reached an agreement to sell approximately 74,000 net acres of its 100 percent owned dry gas acreage position. During the quarter, eight wells were drilled on the Corporation’s Utica joint venture acreage.
3
Valhall (Offshore Norway): Net production averaged 37,000 boepd during the first quarter of 2014, compared with 5,000 boepd in the year-ago quarter following completion of a redevelopment project in 2013.
North Malay Basin (Offshore Malaysia): Production averaged 7,000 boepd in the first quarter of 2014. Progress continues on the full field development where the Corporation expects to award contracts on the Central Processing Platform in the second quarter.
Kurdistan Region of Iraq (Onshore): The Corporation’s first exploration well on the Shakrok block is progressing with production test results expected in the second quarter. On the Dinarta block, the rig has been mobilized and drilling is expected to commence in the second quarter of 2014.
Ghana (Offshore): In April 2014, the Corporation signed a farmdown agreement to reduce its working interest from 90 percent to 50 percent. This agreement is subject to approval by the Ghanaian government. The Corporation plans to drill three appraisal wells, commencing in the second quarter of 2014.
Tubular Bells (Offshore U.S.): The host facilities (SPAR Hull and Topsides) were completed and installed in the first quarter. The offshore hook-up and final commissioning is underway with first production anticipated in the third quarter of 2014.
Capital and Exploratory Expenditures:
Capital and exploratory expenditures in the first quarter of 2014 were $1,522 million, of which $1,208 million related to Exploration and Production operations. The Corporation’s capital expenditures included $290 million related to the acquisition of its partners' 56 percent interest in WilcoHess, a retail gasoline joint venture. Capital and exploratory expenditures for the first quarter of 2013 were $1,631 million, of which $1,613 million related to Exploration and Production operations.
4
Asset Sales:
During the first quarter, the Corporation completed the sale of its interest in the Pangkah Field, offshore Indonesia, for cash proceeds of approximately $650 million. The Corporation also reached an agreement to sell approximately 74,000 acres of its dry gas position in the Utica Shale for $924 million. Approximately 47,000 acres were sold in March 2014 for proceeds of approximately $590 million, and the sale of the remaining dry gas acres is expected to be completed in the second half of the year. In April, the Corporation announced that it had completed the sale of its assets in Thailand for proceeds of approximately $1 billion, effective July 1, 2013. The Corporation also signed an agreement in April, with completion expected mid-year, to sell its 50 percent interest in a joint venture that is constructing an electric generating facility in Newark, New Jersey for approximately $330 million. Divestiture processes continue for the Corporation’s retail marketing and energy trading businesses.
Liquidity:
Net cash provided by operating activities was $1,158 million in the first quarter of 2014, compared with $819 million in the same quarter of 2013. At March 31, 2014, cash and cash equivalents totaled $1,288 million, compared with $1,814 million at December 31, 2013. Total debt was $5,576 million at March 31, 2014 compared with $5,798 million at December 31, 2013. The Corporation’s debt to capitalization ratio at March 31, 2014 was 18.7 percent, down from 19.0 percent at the end of 2013.
Returning Capital to Shareholders:
In the first quarter of 2014, the Corporation purchased approximately 12.6 million shares of common stock at a cost of approximately $1.0 billion for an average cost per share of $79.33, under the Corporation’s authorized $4 billion share repurchase program. Since initiation of the buyback program in August 2013, total shares repurchased through March 31, 2014 were approximately 31.9 million shares at a total cost of approximately $2.54 billion for an average cost per share of $79.53. The total shares purchased through March 31, 2014 represent approximately 9 percent of fully diluted shares at the commencement of the repurchase program. The Corporation’s fully diluted shares were 316.4 million at March 31, 2014.
5
Downstream Businesses:
The downstream businesses reported losses of $33 million in the first quarter of 2014, compared with income of $99 million in the same period in 2013. Adjusted earnings were $13 million in the first quarter of 2014 and $69 million in the first quarter of 2013. The decrease in adjusted earnings was primarily the result of the divestiture of the energy marketing and terminal businesses in the fourth quarter of 2013 and the wind down of operations.
Items Affecting Comparability of Earnings Between Periods:
The following table reflects the total after-tax income (expense) of items affecting comparability of earnings between periods:
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Three Months Ended
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|||||||
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March 31, (unaudited)
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|||||||
| 2014 | 2013 | ||||||
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(In millions)
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|||||||
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Exploration and Production
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$ | (6 | ) | $ | 588 | ||
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Corporate and Interest
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(8 | ) | (11 | ) | |||
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Downstream Businesses
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(46 | ) | 30 | ||||
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Total items affecting comparability of earnings between periods
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$ | (60 | ) | $ | 607 | ||
Exploration and Production: First quarter 2014 Exploration and Production results included an after-tax charge of $6 million for employee severance ($6 million pre-tax).
Corporate and Interest: First quarter results included after-tax charges of $8 million ($12 million pre-tax) for severance and other exit costs.
Downstream Businesses: First quarter results included an after-tax gain of $24 million ($39 million pre-tax) resulting from the required remeasurement of the Corporation’s original 44 percent investment in WilcoHess at fair value following acquisition of the remaining interest in the venture. The Corporation also recorded after-tax income of $16 million ($25 million pre-tax) resulting from the liquidation of last-in, first-out (LIFO) inventories. These gains were offset by an after-tax charge of $52 million ($84 million pre-tax) to reduce to fair value the Corporation’s investment in the Bayonne Energy Center joint venture (Hess 50 percent) and $34 million after income taxes ($53 million pre-tax) for exit costs, severance and other charges.
6
Reconciliation of U.S. GAAP to Non-GAAP measures:
The following table reconciles reported net income attributable to Hess Corporation and adjusted earnings:
|
Three Months Ended
|
|||||||
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March 31, (unaudited)
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|||||||
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2014
|
2013
|
||||||
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(In millions)
|
|||||||
|
Net income attributable to Hess Corporation
|
$ | 386 | $ | 1,276 | |||
|
Less: Total items affecting comparability of earnings between periods
|
(60 | ) | 607 | ||||
|
Adjusted earnings attributable to Hess Corporation
|
$ | 446 | $ | 669 | |||
The following table reconciles reported net cash provided by operating activities to cash flows from operations before changes in working capital:
|
Three Months
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|||
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Ended
|
|||
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March 31, 2014
|
|||
|
(unaudited)
|
|||
|
(In millions)
|
|||
|
Net cash provided by operating activities
|
$ | 1,158 | |
|
Add back: Increases in working capital
|
248 | ||
|
Cash flows from operations, excluding
|
|||
|
working capital changes
|
$ | 1,406 | |
Hess Corporation will review first quarter financial and operating results and other matters on a webcast at 10 a.m. today. For details about the event, refer to the Investor Relations section of our website at www.hess.com.
Hess Corporation is a leading global independent energy company engaged in the exploration and production of crude oil and natural gas. More information on Hess Corporation is available at www.hess.com.
Forward-looking Statements
Certain statements in this release may constitute "forward-looking statements" within the meaning of Section 21E of the United States Securities Exchange Act of 1934, as amended, and Section 27A of the United States Securities Act of 1933, as amended. Forward-looking statements are subject to known and unknown risks and uncertainties and other factors which may cause actual results to differ materially from those expressed or implied by such statements, including, without limitation, uncertainties inherent in the measurement and interpretation of geological, geophysical and other technical data. Estimates and projections contained in this release are based on the Company’s current understanding and assessment based on reasonable assumptions. Actual results may differ materially from these estimates and projections due to certain risk factors discussed in the Corporation’s periodic filings with the Securities and Exchange Commission and other factors.
7
Non-GAAP financial measures
The Corporation has used two non-GAAP financial measures in this earnings release. “Adjusted earnings” presented in this release is defined as reported net income attributable to Hess Corporation excluding items identified as affecting comparability of earnings between periods. “Cash flows from operations, excluding working capital changes” is defined as net cash provided by operating activities before adjustments for changes in working capital. We believe that investors’ understanding of our performance is enhanced by disclosing these measures. These measures are not, and should not be viewed as, a substitute for U.S. GAAP net income or cash flow. A reconciliation of reported net income attributable to Hess Corporation (U.S. GAAP) to adjusted earnings and a reconciliation of net cash provided by operating activities (U.S. GAAP) to cash flows from operations excluding working capital changes, are provided in the release.
For Hess Corporation
Investor Contact:
Jay Wilson
(212) 536-8940
Media Contact:
Michael Henson/Patrick Scanlan
Sard Verbinnen & Co
(212) 687-8080
8
HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
SUPPLEMENTAL FINANCIAL DATA (UNAUDITED)
(IN MILLIONS)
|
First
|
First
|
Fourth
|
||||||||||
|
Quarter
|
Quarter
|
Quarter
|
||||||||||
|
2014
|
2013
|
2013
|
||||||||||
|
Income Statement
|
||||||||||||
|
Revenues and Non-operating Income
|
||||||||||||
|
Sales and other operating revenues
|
$ | 5,554 | $ | 6,106 | $ | 5,183 | ||||||
|
Gains on asset sales, net
|
10 | 688 | 380 | |||||||||
|
Other, net
|
(58 | ) | (34 | ) | 5 | |||||||
|
Total revenues and non-operating income
|
5,506 | 6,760 | 5,568 | |||||||||
|
Costs and Expenses
|
||||||||||||
|
Cost of products sold (excluding items shown separately below)
|
2,922 | 3,054 | 2,693 | |||||||||
|
Operating costs and expenses
|
466 | 585 | 546 | |||||||||
|
Production and severance taxes
|
62 | 130 | 61 | |||||||||
|
Marketing expenses
|
293 | 225 | 245 | |||||||||
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Exploration expenses, including dry holes and lease impairment
|
119 | 219 | 458 | |||||||||
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General and administrative expenses
|
153 | 158 | 214 | |||||||||
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Interest expense
|
81 | 106 | 97 | |||||||||
|
Depreciation, depletion and amortization
|
752 | 689 | 778 | |||||||||
|
Asset impairments
|
- | - | 289 | |||||||||
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Total costs and expenses
|
4,848 | 5,166 | 5,381 | |||||||||
|
Income from continuing operations before income taxes
|
658 | 1,594 | 187 | |||||||||
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Provision (benefit) for income taxes
|
248 | 451 | (666 | ) | ||||||||
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Net income from continuing operations
|
410 | 1,143 | 853 | |||||||||
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Net income from discontinued operations
|
11 | 130 | 1,062 | |||||||||
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Net income
|
421 | 1,273 | 1,915 | |||||||||
|
Less: Net income (loss) attributable to noncontrolling interests
|
35 | (3 | ) | (10 | ) | |||||||
|
Net income attributable to Hess Corporation
|
$ | 386 | $ | 1,276 | $ | 1,925 | ||||||
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|
||||||||||||
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Cash Flow Information
|
||||||||||||
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Net cash provided by operating activities (*)
|
$ | 1,158 | $ | 819 | $ | 1,550 | ||||||
|
Net cash provided by (used in) investing activities
|
(262 | ) | (261 | ) | 1,390 | |||||||
|
Net cash provided by (used in) financing activities
|
(1,422 | ) | (756 | ) | (1,447 | ) | ||||||
|
Net increase (decrease) in cash and cash equivalents
|
$ | (526 | ) | $ | (198 | ) | $ | 1,493 | ||||
(*) Includes changes in working capital.
9
HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
SUPPLEMENTAL FINANCIAL DATA (UNAUDITED)
(IN MILLIONS)
|
March 31,
|
December 31,
|
|||||||
|
2014
|
2013
|
|||||||
|
Balance Sheet Information
|
||||||||
|
Cash and cash equivalents
|
$ | 1,288 | $ | 1,814 | ||||
|
Assets held for sale
|
366 | 1,097 | ||||||
|
Other current assets
|
5,606 | 5,688 | ||||||
|
Investments
|
485 | 687 | ||||||
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Property, plant and equipment – net
|
29,166 | 28,771 | ||||||
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Other long-term assets
|
4,725 | 4,697 | ||||||
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Total assets
|
$ | 41,636 | $ | 42,754 | ||||
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Short-term debt and current maturities of long-term debt
|
$ | 142 | $ | 378 | ||||
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Liabilities associated with assets held for sale
|
193 | 286 | ||||||
|
Other current liabilities
|
5,858 | 5,894 | ||||||
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Long-term debt
|
5,434 | 5,420 | ||||||
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Other long-term liabilities
|
5,767 | 5,992 | ||||||
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Total equity excluding other comprehensive income (loss)
|
24,518 | 25,122 | ||||||
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Accumulated other comprehensive income (loss)
|
(276 | ) | (338 | ) | ||||
|
Total liabilities and equity
|
$ | 41,636 | $ | 42,754 | ||||
10
HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
SUPPLEMENTAL FINANCIAL DATA (UNAUDITED)
(IN MILLIONS)
|
First
|
First
|
Fourth
|
||||||||||
|
Quarter
|
Quarter
|
Quarter
|
||||||||||
|
2014
|
2013
|
2013
|
||||||||||
|
Capital and Exploratory Expenditures
|
||||||||||||
|
Exploration and Production
|
||||||||||||
|
United States
|
||||||||||||
|
Bakken
|
$ | 451 | $ | 535 | $ | 571 | ||||||
|
Other Onshore
|
155 | 176 | 176 | |||||||||
|
Total Onshore
|
606 | 711 | 747 | |||||||||
|
Offshore
|
162 | 228 | 212 | |||||||||
|
Total United States
|
768 | 939 | 959 | |||||||||
|
Europe
|
145 | 219 | 174 | |||||||||
|
Africa
|
100 | 229 | 132 | |||||||||
|
Asia and other
|
195 | 226 | 211 | |||||||||
|
Total Exploration and Production
|
1,208 | 1,613 | 1,476 | |||||||||
|
Other
|
314 | (*) | 18 | 68 | ||||||||
|
Total Capital and Exploratory Expenditures
|
$ | 1,522 | $ | 1,631 | $ | 1,544 | ||||||
|
Total exploration expenses charged to income included above
|
$ | 78 | $ | 110 | $ | 123 | ||||||
(*) Includes $290 million related to the Corporation’s acquisition of its partners' 56 percent interest in WilcoHess, a retail gasoline joint venture.
11
HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
EXPLORATION AND PRODUCTION EARNINGS (UNAUDITED)
(IN MILLIONS)
|
First Quarter 2014
|
||||||||||||||
|
United States
|
International
|
Total
|
||||||||||||
|
Sales and other operating revenues
|
$
|
1,545
|
$
|
1,128
|
$
|
2,673
|
||||||||
|
Gains on asset sales, net
|
-
|
10
|
10
|
|||||||||||
|
Other, net
|
(2
|
) |
(4
|
) |
(6
|
) | ||||||||
|
Total revenues and non-operating income
|
1,543
|
1,134
|
2,677
|
|||||||||||
|
Costs and Expenses
|
||||||||||||||
|
Cost of products sold (excluding items shown separately below)
|
414
|
(21
|
) |
393
|
||||||||||
|
Operating costs and expenses
|
209
|
257
|
466
|
|||||||||||
|
Production and severance taxes
|
58
|
4
|
62
|
|||||||||||
|
Exploration expenses, including dry holes and lease impairment
|
47
|
72
|
119
|
|||||||||||
|
General and administrative expenses
|
58
|
22
|
80
|
|||||||||||
|
Depreciation, depletion and amortization
|
360
|
361
|
721
|
|||||||||||
|
Total costs and expenses
|
1,146
|
695
|
1,841
|
|||||||||||
|
Results of operations before income taxes
|
397
|
439
|
836
|
|||||||||||
|
Provision (benefit) for income taxes
|
157
|
171
|
328
|
|||||||||||
|
Net income
|
240
|
268
|
508
|
|||||||||||
|
Less: Net income attributable to noncontrolling interests
|
-
|
-
|
-
|
|||||||||||
|
Net income attributable to Hess Corporation
|
$
|
240
|
$
|
268
|
(b)
|
$
|
508
|
|||||||
|
First Quarter 2013
|
||||||||||||||
|
United States
|
International
|
Total
|
||||||||||||
|
Sales and other operating revenues
|
$
|
1,691
|
$
|
1,775
|
$
|
3,466
|
||||||||
|
Gains on asset sales, net
|
-
|
688
|
688
|
|||||||||||
|
Other, net
|
(6
|
) |
(29
|
) |
(35
|
) | ||||||||
|
Total revenues and non-operating income
|
1,685
|
2,434
|
4,119
|
|||||||||||
|
Costs and Expenses
|
||||||||||||||
|
Cost of products sold (excluding items shown separately below)
|
577
|
19
|
596
|
|||||||||||
|
Operating costs and expenses
|
191
|
394
|
585
|
|||||||||||
|
Production and severance taxes
|
57
|
73
|
130
|
|||||||||||
|
Exploration expenses, including dry holes and lease impairment
|
108
|
111
|
219
|
|||||||||||
|
General and administrative expenses
|
41
|
44
|
85
|
|||||||||||
|
Depreciation, depletion and amortization
|
365
|
311
|
676
|
|||||||||||
|
Total costs and expenses
|
1,339
|
952
|
2,291
|
|||||||||||
|
Results of operations before income taxes
|
346
|
1,482
|
1,828
|
|||||||||||
|
Provision (benefit) for income taxes
|
145
|
390
|
535
|
|||||||||||
|
Net income
|
201
|
1,092
|
1,293
|
|||||||||||
|
Less: Net income attributable to noncontrolling interests
|
-
|
7
|
7
|
|||||||||||
|
Net income attributable to Hess Corporation
|
$
|
201
|
(a)
|
$
|
1,085
|
(b)
|
$
|
1,286
|
||||||
|
(a)
|
The results of crude oil hedging activities were after-tax realized losses of $4 million in the first quarter of 2013.
|
|
(b)
|
The results of crude oil hedging activities were after-tax realized gains of $2 million in the first quarter of 2014 and losses of $7 million in the first quarter of 2013.
|
12
HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
EXPLORATION AND PRODUCTION EARNINGS (UNAUDITED)
(IN MILLIONS)
|
Fourth Quarter 2013
|
||||||||||||||
|
United States
|
International
|
Total | ||||||||||||
|
Sales and other operating revenues
|
$
|
1,396
|
$
|
1,326
|
$
|
2,722
|
||||||||
|
Gains on asset sales, net
|
(6
|
) |
386
|
380
|
||||||||||
|
Other, net
|
(1
|
) |
-
|
(1
|
) | |||||||||
|
Total revenues and non-operating income
|
1,389
|
1,712
|
3,101
|
|||||||||||
|
Costs and Expenses
|
||||||||||||||
|
Cost of products sold (excluding items shown separately below)
|
413
|
49
|
462
|
|||||||||||
|
Operating costs and expenses
|
213
|
333
|
546
|
|||||||||||
|
Production and severance taxes
|
56
|
5
|
61
|
|||||||||||
|
Exploration expenses, including dry holes and lease impairment
|
129
|
329
|
458
|
|||||||||||
|
General and administrative expenses
|
72
|
37
|
109
|
|||||||||||
|
Depreciation, depletion and amortization
|
347
|
363
|
710
|
|||||||||||
|
Asset impairments
|
-
|
289
|
289
|
|||||||||||
|
Total costs and expenses
|
1,230
|
1,405
|
2,635
|
|||||||||||
|
Results of operations before income taxes
|
159
|
307
|
466
|
|||||||||||
|
Provision (benefit) for income taxes
|
45
|
(608
|
) |
(563
|
) | |||||||||
|
Net income
|
114
|
915
|
1,029
|
|||||||||||
|
Less: Net income attributable to noncontrolling interests
|
-
|
-
|
-
|
|||||||||||
|
Net income attributable to Hess Corporation
|
$
|
114
|
(a)
|
$
|
915
|
|
(b)
|
$
|
1,029
|
|||||
|
(a)
|
The results of crude oil hedging activities were after-tax realized gains of $1 million in the fourth quarter of 2013.
|
|
(b)
|
The results of crude oil hedging activities were after-tax realized gains of $1 million in the fourth quarter of 2013.
|
13
HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
EXPLORATION AND PRODUCTION SUPPLEMENTAL OPERATING DATA (UNAUDITED)
|
First
|
First
|
Fourth
|
||||||||
|
Quarter
|
Quarter
|
Quarter
|
||||||||
|
2014
|
2013
|
2013
|
||||||||
|
Operating Data
|
||||||||||
|
Net Production Per Day (in thousands)
|
||||||||||
|
Crude oil - barrels
|
||||||||||
|
United States
|
||||||||||
|
Bakken
|
58
|
53
|
57
|
|||||||
|
Other Onshore
|
9
|
13
|
9
|
|||||||
|
Total Onshore
|
67
|
66
|
66
|
|||||||
|
Offshore
|
51
|
47
|
41
|
|||||||
|
Total United States
|
118
|
113
|
107
|
|||||||
|
Europe
|
39
|
65
|
39
|
|||||||
|
Africa
|
48
|
78
|
42
|
|||||||
|
Asia
|
5
|
16
|
9
|
|||||||
|
Total
|
210
|
272
|
197
|
|||||||
|
Natural gas liquids - barrels
|
||||||||||
|
United States
|
||||||||||
|
Bakken
|
2
|
6
|
5
|
|||||||
|
Other Onshore
|
2
|
4
|
3
|
|||||||
|
Total Onshore
|
4
|
10
|
8
|
|||||||
|
Offshore
|
7
|
7
|
5
|
|||||||
|
Total United States
|
11
|
17
|
13
|
|||||||
|
Europe
|
2
|
-
|
2
|
|||||||
|
Asia
|
-
|
1
|
1
|
|||||||
|
Total
|
13
|
18
|
16
|
|||||||
|
Natural gas - mcf
|
||||||||||
|
United States
|
||||||||||
|
Bakken
|
15
|
34
|
33
|
|||||||
|
Other Onshore
|
26
|
27
|
23
|
|||||||
|
Total Onshore
|
41
|
61
|
56
|
|||||||
|
Offshore
|
78
|
72
|
58
|
|||||||
|
Total United States
|
119
|
133
|
114
|
|||||||
|
Europe
|
37
|
13
|
33
|
|||||||
|
Asia and other
|
415
|
447
|
418
|
|||||||
|
Total
|
571
|
593
|
565
|
|||||||
|
Barrels of oil equivalent
|
318
|
389
|
307
|
|||||||
|
Sales Volumes Per Day (in thousands)
|
||||||||||
|
Crude oil - barrels
|
197
|
275
|
202
|
|||||||
|
Natural gas liquids - barrels
|
12
|
18
|
16
|
|||||||
|
Natural gas - mcf
|
571
|
596
|
566
|
|||||||
|
Barrels of oil equivalent
|
305
|
393
|
313
|
|||||||
|
Sales Volumes (in thousands)
|
||||||||||
|
Crude oil - barrels
|
17,750
|
24,767
|
18,598
|
|||||||
|
Natural gas liquids - barrels
|
1,122
|
1,647
|
1,485
|
|||||||
|
Natural gas - mcf
|
51,357
|
53,662
|
52,085
|
|||||||
|
Barrels of oil equivalent
|
27,432
|
35,358
|
28,764
|
|||||||
14
HESS CORPORATION AND CONSOLIDATED SUBSIDIARIES
EXPLORATION AND PRODUCTION SUPPLEMENTAL OPERATING DATA (UNAUDITED)
|
First
|
First
|
Fourth
|
||||||||||
|
Quarter
|
Quarter
|
Quarter
|
||||||||||
|
2014
|
2013
|
2013
|
||||||||||
|
Operating Data
|
||||||||||||
|
Average Selling Prices
|
||||||||||||
|
Crude oil - per barrel (including hedging)
|
||||||||||||
|
United States
|
||||||||||||
|
Onshore
|
$ | 88.04 | $ | 89.46 | $ | 84.54 | ||||||
|
Offshore
|
99.34 | 107.52 | 93.62 | |||||||||
|
Total United States
|
92.94 | 97.03 | 87.98 | |||||||||
|
Europe
|
109.17 | 63.51 | 110.73 | |||||||||
|
Africa
|
108.40 | 109.81 | 109.34 | |||||||||
|
Asia
|
102.29 | 110.70 | 105.20 | |||||||||
|
Worldwide
|
99.17 | 94.50 | 98.27 | |||||||||
|
Crude oil - per barrel (excluding hedging)
|
||||||||||||
|
United States
|
||||||||||||
|
Onshore
|
$ | 88.04 | $ | 89.82 | $ | 84.47 | ||||||
|
Offshore
|
99.34 | 108.70 | 93.34 | |||||||||
|
Total United States
|
92.94 | 97.74 | 87.83 | |||||||||
|
Europe
|
108.74 | 63.69 | 110.20 | |||||||||
|
Africa
|
107.92 | 111.18 | 109.32 | |||||||||
|
Asia
|
102.29 | 110.70 | 105.20 | |||||||||
|
Worldwide
|
99.00 | 95.24 | 98.07 | |||||||||
|
Natural gas liquids - per barrel
|
||||||||||||
|
United States
|
||||||||||||
|
Onshore
|
$ | 53.46 | $ | 43.47 | $ | 46.02 | ||||||
|
Offshore
|
34.07 | 27.79 | 30.29 | |||||||||
|
Total United States
|
41.54 | 37.29 | 40.08 | |||||||||
|
Europe
|
63.83 | 45.77 | 59.78 | |||||||||
|
Asia
|
- | 79.44 | 81.11 | |||||||||
|
Worldwide
|
44.28 | 38.67 | 44.59 | |||||||||
|
Natural gas - per mcf
|
||||||||||||
|
United States
|
||||||||||||
|
Onshore
|
$ | 6.10 | $ | 2.86 | $ | 3.39 | ||||||
|
Offshore
|
4.37 | 2.54 | 2.96 | |||||||||
|
Total United States
|
4.96 | 2.69 | 3.17 | |||||||||
|
Europe
|
11.48 | 7.98 | 11.82 | |||||||||
|
Asia and other
|
7.23 | 7.75 | 7.62 | |||||||||
|
Worldwide
|
7.03 | 6.62 | 6.97 | |||||||||
For Hess Corporation
Investor Contact:
Jay Wilson
(212) 536-8940
Media Contact:
Michael Henson/Patrick Scanlan
Sard Verbinnen & Co
(212) 687-8080
15