Burlington Resources Reports Record Production, Offset by Lower Gas Prices

Burlington Resources, a major natural gas production giant, reported record production in the third quarter of 1994, but was offset by sharply lower gas prices. The company's net income for the quarter ended September 30 came in at $20.7 million on revenues of $314 million, a decline from $24.6 million in income on revenues of $309.5 million in the same period of 1993. Despite the lower gas prices, natural gas sales volumes reached an average 1.077 Bcfd, a 21% increase from 890 MMcfd in the year-earlier period. The company's oil sales also saw an increase, with 46,800 b/d sold at prices of $16.97/bbl, up 14% from 41,100 b/d in the 1993 third quarter.

Key Takeaways:

• Burlington Resources reported record production in the third quarter of 1994, with natural gas sales volumes reaching an average 1.077 Bcfd, a 21% increase from the year-earlier period.
• However, lower gas prices dropped to an average $1.42/Mcf from $1.70/ Mcf in the 1993 third quarter, offsetting the increase in production.
• Oil sales also increased to 46,800 b/d, up 14% from 41,100 b/d a year ago, at prices of $16.97/bbl, compared with $15.76/bbl in the 1993 third quarter.
• The company attributed the lower gas prices to cool summer weather and increased power generation by nuclear plants, which reduced demand for natural gas.
• Burlington Resources has not been active in hedging gas prices, a company source said.
• For the first nine months of 1994, operating income was $154.7 million, compared with $192.2 million for the same period last year.
• Capital expenditures for the 1994 period jumped to $751 million from $427 million, reflecting increased development work and reserve acquisitions.
• The company has repurchased 26.9 million shares of its own common stock since 1988, out of about 128.7 million shares outstanding.
• Kidder, Peabody & Co. expects Burlington Resources' operating earnings per share to rise to 41* for the fourth quarter and $1.20 for 1995 from the 16* reported for the third quarter.

Statistics:

• Net income for the three months ended September 30 of $20.7 million, a decline from $24.6 million in the same period of 1993.
• Operating income for the third quarter was $39.4 million, compared with $56.5 million in 1993.
• Natural gas sales volumes reached an average 1.077 Bcfd in the 1994 third quarter, a 21% increase from 890 MMcfd in the year-earlier period.
• Received gas prices dropped to an average $1.42/Mcf from $1.70/ Mcf for the 1993 third quarter.
• Oil sales increased to 46,800 b/d, up 14% from 41,100 b/d a year ago, at prices of $16.97/bbl, compared with $15.76/bbl in the 1993 third quarter.
• Capital expenditures for the 1994 period jumped to $751 million from $427 million.

Sources:

• [No sources mentioned in the original text]