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Murphy Oil Reports Revenue Gain, 2Q Adjusted Income of $36M

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Murphy Oil Corp., the El Dorado oil production and exploration titan, reported better-than-expected second-quarter earnings in financial results filed Wednesday evening, including an 82% revenue gain over results from the same quarter last year.

The company, which recently divested offshore oil fields in Malaysia and reported them as discontinued operations, listed net income attributable to Murphy of $92 million, or 54 cents per diluted share of stock. Adjusted net income, excluding the Asian sale and other one-off items, weighed in at $36 million, or 21 cents a share.

Murphy noted a crude production increase of nearly 30 percent year over year, as well as increased drilling efficiencies and strong performance by its onshore portfolio, which includes operations in Texas and the oil sands of western Canada. 

In a report to the federal Securities & Exchange Commission, Murphy offered these financial highlights for the second quarter:

  • The repurchase of about 7% of outstanding shares for $300 million, resulting in cumulative share repurchases of more than $1.6 billion since 2012.

  • High values of EBITDA per barrel of oil equivalent: $35 for the Eagle Ford Shale and $38 for North America Offshore at the field level.

  • Reduced lease operating expenses to below $9 per barrel of oil equivalent.

Overall, production was above guidance, the company said, aided by reduced downtime and better performance from the company’s newly acquired Gulf of Mexico assets.

“2019 is proving to be an excellent year for Murphy,” company President and CEO Roger Jenkins said in a statement. “We closed our Gulf of Mexico and Malaysia transactions, leading to a completely transformed portfolio. Our now simplified and concentrated Gulf Coast asset base, in the Eagle Ford Shale and Gulf of Mexico, has an extensive runway that is able to generate oil-weighted, high-margin production. Additionally, our Eagle Ford Shale team executed beyond their well delivery plan, further supporting forecasted growth expectations.”

At the end of June, Murphy Oil had total debt outstanding of $4.7 billion: $2.8 billion of outstanding long-term, fixed-rate notes; $1.4 billion of borrowings on a $1.6 billion unsecured senior credit facility; and a $500 million unsecured senior term loan. Through stock buybacks, the company has reduced its share count by 11.4 million shares, or approximately 7%, to 162.3 million shares outstanding. As of July 31, 2019, liquidity totaled more than $2.0 billion, including approximately $450 million in cash and cash equivalents.

“I am very pleased with our financial position,” Jenkins added. “We have completed the execution of a year-long business development plan that resulted in a transformed company with a strong liquidity position. Furthermore, I am most proud of setting up the company with an improved asset base capable of generating fourth quarter 2019 production of approximately 200,000 barrels of oil equivalent per day with more oil production and reserves, all while reducing share count and providing a leading dividend yield to our shareholders.”

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