ConocoPhillips rides high prices on oil, gas to $1.3 billion profit

HOUSTON -- ConocoPhillips rode high oil and gas prices and better refining margins to a $1.3 billion third-quarter profit, the company said Wednesday.

ConocoPhillips' net income totaled $1.90 per share, compared to a net loss of $116 million, or 24 cents per share, in the year-ago quarter. The 2002 results include two months of activity from Phillips Petroleum Inc. and one month of activity from the combined company, which completed its $15 billion merger in August last year.

The fourth quarter of this year will be the first since the merger in which earnings will be compared to the combined company's performance in the year-ago period.

Income from continuing operations for the third quarter was $1.25 billion, or $1.82 per share, compared to a loss of $74 million, or 15 cents per share, a year earlier.

Analysts surveyed by Thomson First Call expected ConocoPhillips to earn $1.59 per share.

Revenues were $26.5 billion, compared to $14.7 billion in the third quarter of 2002.

"We operated and benefited from market conditions in both upstream and downstream," said Jim Mulva, president and chief executive officer of ConocoPhillips.

In the first nine months of 2003, net income was $3.69 billion, or $5.40 per share, compared to $133 million, or 32 cents a share, in the January-September period of 2002, which included one month of activity by the combined company. Total revenues for the first nine months were $79.1 billion, compared to $33.7 billion a year ago.

John Parry, an analyst with John S. Herold, said he had expected oil prices to be softer in the third quarter and ConocoPhillips, the nation's third-largest oil company, reaped the benefits.

"Fundamentally I would say, probably oil prices are staying stronger than we anticipated" and that, with stronger refining and marketing results, "brought the earnings up a little bit more than we thought."

Mulva said ConocoPhillips has completed asset sales of $2.2 billion since the merger closed, and the company expects to finish an estimated $1.3 billion more by the end of the year.

"This will meet our announced divestiture program target of $3 billion to $4 billion by the end of 2004," Mulva said.

Daily production for the third quarter dropped to 1.56 million barrels of oil equivalent per day from 1.64 million in the second quarter this year because of seasonal declines, scheduled maintenance in Alaska and the North Sea, and asset dispositions in the Lower 48 states.

Mulva said the company will pursue expansion of worldwide natural gas opportunities in Qatar, Venezuela and Australia. He also said the company anticipates crude oil utilization rates to exceed 90 percent.

ConocoPhillips shares ended unchanged at $56.97 in trading Wednesday on the New York Stock Exchange.

Copyright C 2003 Deseret News Publishing Co.
Provided by ProQuest Information and Learning Company. All rights Reserved.