APA (APA) Q3 2024 earnings summary

Executive summary

• Achieved strong Q3 2024 operational and financial results, with production of 467,000 BOE/d, exceeding guidance and driven by Permian and Egypt performance.

• Completed Callon acquisition and integration, increasing Permian assets and capturing cost synergies.

• Announced $950 million sale of non-core Permian assets, expected to close in Q4 2024, with proceeds aimed at debt reduction.

• Reached FID on Suriname Block 58 (GranMorgu), a 220,000 b/d project with first oil expected in 2028 and robust economics.

• Upgraded to investment-grade status by all three major rating agencies.

Financial highlights

• Q3 2024 net loss attributable to common stock was $223 million ($0.60/share), driven by $1.1 billion in impairments (mainly North Sea and Permian).

• Adjusted Q3 net income was $370 million ($1.00/share), with adjusted EBITDAX of $1.6 billion.

• Net cash from operating activities was $1.3 billion; free cash flow for Q3 was $219 million.

• Q3 2024 revenues were $2.06 billion; oil prices averaged $78.06/bbl, natural gas $1.43/mcf.

• Net debt at quarter-end was $6.3 billion, down from $6.6 billion in Q2.

Outlook and guidance

• 2025 capital budget set at $2.5–$2.6 billion, with $200 million for Suriname and $100 million for Alaska exploration.

• Plan to run 8 rigs in the Permian and 12 in Egypt to sustain production; North Sea production expected to decline ~20% year-over-year and cease before 2030.

• 2025 cost structure expected to decrease 10%-15% year-over-year, driven by synergies and divestitures.

• U.S. oil production expected to be maintained at ~130,000 bbl/d post-asset sale with 8 rigs.