EX-99.1 3 h14605exv99w1.txt PRESS RELEASE DATED APRIL 21, 2004 . . . EXHIBIT 99.1 (BURLINGTON RESOURCES LOGO) NEWS RELEASE ---------------------------------------------------------------------------------------------------- TO: DAILY PAPERS, TRADE PRESS FOR: IMMEDIATE COMPANY CONTACTS: FINANCIAL AND SECURITY ANALYSTS RELEASE FINANCIAL: JOHN CARRARA 713-624-9548 MEDIA: JAMES BARTLETT 713-624-9354 BURLINGTON RESOURCES WEB SITE: www.br-inc.com BR0416 ---------------------------------------------------------------------------------------------------- BURLINGTON RESOURCES ACHIEVES RECORD QUARTERLY PRODUCTION AND 32 PERCENT INCREASE IN FIRST-QUARTER EARNINGS TO $354 MILLION HOUSTON, TEXAS, APRIL 21, 2004 -- Burlington Resources Inc. (NYSE: BR and TSX: B) today reported estimated earnings during the first quarter of 2004 of $354 million, or $1.78 per diluted share, a 32 percent increase over the $269 million, or $1.33 per diluted share, earned during the first quarter of 2003. Included in the 2003 results was a non-cash after-tax charge of $59 million, or $0.29 per share, for a change in accounting principle related to future asset retirement obligations. The increase in 2004 first-quarter earnings was attributable to a 14 percent rise in total production to a new quarterly record of 2,849 million cubic feet of natural gas equivalent per day (MMcfed), from 2,490 MMcfed during the prior year's quarter. Commodity price realizations were essentially flat. Net cash provided by operating activities increased to $742 million from $589 million during the prior year's quarter. Discretionary cash flow(1) increased to $812 million from $721 million during the prior year's quarter. In addition, at the end of the first quarter the company's balance sheet included more than $1 billion in cash and cash equivalents, an increase of $270 million during the quarter. Share repurchases during the quarter totaled approximately 1.6 million shares for $90 million at an average cost of $58.10 per share. This brings the cumulative number of shares acquired since the late-2000 resumption of Burlington's share repurchase program to more than 25.2 million shares for $1 billion, or an average cost of $45.31 per share. "These outstanding results confirm that we are entering what we believe will be a period of sustainable growth for our company," said Bobby S. Shackouls, chairman, president and chief executive officer. "Our North American core properties continue performing strongly, while the major international development programs are ramping up during a very favorable price window. Our progress as well as our future prospects give us confidence in our goal of generating 20 percent cumulative production growth during the three-year period beginning with 2004." Burlington's first-quarter production growth included a 4 percent increase in natural gas production to 1,953 million cubic feet per day (MMcfd), from 1,872 MMcfd during the prior year's quarter. Natural gas liquids (NGLs) production increased 5 percent to 66.9 thousand barrels per day (Mbd), from 63.7 Mbd during the prior year's quarter. Crude oil production increased 110 percent to 82.4 Mbd, from 39.3 Mbd during the prior year's quarter. The substantially higher crude oil volumes were attributable to higher production from the Williston Basin in the U.S., and from start-ups during 2003 of several fields located in Algeria, China and elsewhere. Increases in natural gas and NGLs production resulted primarily from higher volumes in the Barnett Shale trend in North Texas, and from properties in South Louisiana and Northwestern Europe. During the quarter Burlington conducted ongoing development in virtually all its major properties. The company's realizations for natural gas were $5.31 per Mcf, compared to $5.29 per Mcf during the same quarter in 2003. Price realizations for NGLs were $22.08 per barrel, compared to $22.07 per barrel during the prior year's quarter. Crude oil price realizations were $29.57 per barrel, down from $29.74 per barrel during the prior year's quarter. 2004 OUTLOOK Production - Burlington expects strong volume growth compared to 2003, as a result of anticipated increases in both North American and international production. The guidance breakdown by geographic region and product follows:

2nd-Quarter 2004 Full-Year 2004 Estimate Estimate ---------------- -------------- Gas (MMcfd) U.S. 840 - 885 860 - 905 Canada 825 - 860 825 - 865 Other International 140 - 170 185 - 230 -------------- -------------- Total 1,805 - 1,915 1,870 - 2,000 Natural Gas Liquids (Mbd) U.S. 39.5 - 42.5 40.0 - 42.0 Canada 25.5 - 27.0 25.0 - 27.0 Other International 0.0 - 0.0 0.0 - 0.0 -------------- -------------- Total 65.0 - 69.5 65.0 - 69.0 Crude Oil (Mbd) U.S. 32.5 - 34.2 32.5 - 35.0 Canada 5.0 - 5.5 5.0 - 5.5 Other International 31.0 - 39.0 35.0 - 41.0 -------------- -------------- Total 68.5 - 78.7 72.5 - 81.5 -------------- -------------- Total Equiv. Prod. (MMcfed) 2,606 - 2,804 2,695 - 2,903 ============== ==============

North American Natural Gas Hedges - As of April 14, 2004, Burlington had hedged the following volumes of future North American natural gas production using costless price collars or fixed price contracts. All prices are weighted averages adjusted to a NYMEX equivalent price using an estimate of differentials between the NYMEX price and -2- regional prices. Detailed hedging information is available on Burlington's Web site at www.br-inc.com/docs/hedge.pdf.

2nd-Q. 2004 3rd-Q. 2004 4th-Q. 2004 ----------- ----------- ----------- Costless collar volumes 419 MMcfd 306 MMcfd 266 MMcfd Floor price $4.59/Mcf $4.71/Mcf $4.72/Mcf Ceiling price $6.43/Mcf $6.49/Mcf $6.64/Mcf Sell swaps 39 MMcfd 39 MMcfd 39 MMcfd Sales price $3.58/Mcf $3.63/Mcf $3.61/Mcf Fixed price sales 45 MMcfd Sale price $5.97/Mcf

Other 2004 Financial Parameters - Estimated expenses for the second quarter and full year are:

2nd-Q. 2004 Full-Year 2004 ----------- -------------- Operating costs* $0.55 to $0.59/Mcfe $0.52 to $0.56/Mcfe Administrative costs $0.16 to $0.19/Mcfe $0.16 to $0.19/Mcfe Transportation costs $0.42 to $0.46/Mcfe $0.41 to $0.45/Mcfe Depletion, depreciation & amortization $1.12 to $1.16/Mcfe $1.10 to $1.15/Mcfe Interest expense $68 MM to $72 MM $275 MM to $280 MM Exploration costs $55 MM to $75 MM $235 MM to $255 MM

* Formerly production and processing In addition, Burlington anticipates an effective income tax rate of 33 to 37 percent for the full year of 2004. The breakdown between current and deferred taxes for the year could vary widely depending on commodity prices and other factors. An income statement, statistics and non-GAAP reconciliation tables for the first quarter accompany this release. Burlington will webcast a conference call to discuss its first-quarter 2004 earnings and operations. The call will take place on Thursday, April 22 at 12 p.m. Central time. All materials and information related to the conference call, this press release and a package of financial and statistical information may be accessed from the Burlington Resources Web site home page (www.br-inc.com) by selecting the link entitled "1st Qtr 2004 Conference Call Info Page," and then selecting the resource desired. Burlington Resources ranks among the world's largest independent oil and gas companies, and holds one of the industry's leading positions in North American natural gas reserves and production. Headquartered in Houston, Texas, the company conducts exploration, production and development operations in the U.S., Canada, the United Kingdom, Africa, China and South America. For additional information see the Burlington Resources Web site at www.br-inc.com. -3- (1) See the accompanying tables for a reconciliation of GAAP and non-GAAP measures utilized in calculating discretionary cash flow. -------------------------------------------------------------------------------- FORWARD-LOOKING STATEMENTS This press release may contain projections and other forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Any such projections or statements reflect the company's current views with respect to future events and financial performance. No assurances can be given, however, that these events will occur or that such projections will be achieved and actual results could differ materially from those projected. A discussion of important factors that could cause actual results to differ materially from those projected is included in the company's periodic reports filed with the Securities and Exchange Commission. -------------------------------------------------------------------------------- -4- BURLINGTON RESOURCES INC. RECONCILIATION OF GAAP TO NON-GAAP MEASURE (a) DISCRETIONARY CASH FLOW ($ IN MILLIONS) Below is a reconciliation of net cash provided by operating activities to discretionary cash flow.

First Quarter ------------- 2004 2003 ---- ---- Net cash provided by operating activities $742 $589 Adjustments: Working capital 63 122 Changes in other assets and liabilities 7 10 ---- ---- Discretionary cash flow $812 $721 ==== ====

(a) GAAP - Generally Accepted Accounting Principles. Management believes that the non-GAAP measure of discretionary cash flow is useful information for investors because it is used internally and accepted by the investment community as a means of measuring the company's ability to fund its capital and dividend programs and to service its debt. Discretionary cash flow is also useful because it is widely used by professional research analysts in valuing, comparing ratings and providing investment recommendations of companies in the oil and gas exploration and production industry. Many investors use this published research in making investment decisions. -5- BURLINGTON RESOURCES INC. CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)

FIRST QUARTER ------------------ 2004 2003 ------- ------- (In Millions, Except per Share Amounts) Revenues .............................................................................. $ 1,308 $ 1,128 ------- ------- Costs and Other Income - Net Taxes Other than Income Taxes ......................................................... 59 48 Transportation Expense ................................................................ 110 99 Operating Costs ....................................................................... 131 102 Depreciation, Depletion and Amortization .............................................. 277 203 Exploration Costs ..................................................................... 60 68 Administrative ........................................................................ 48 42 Interest Expense ...................................................................... 71 64 (Gain)/Loss on Disposal of Assets ..................................................... 8 (1) Other Expense (Income) - Net .......................................................... (3) 4 ------- ------- Total Costs and Other Income - Net ............................................. 761 629 ------- ------- Income Before Income Taxes and Cumulative Effect of Change in Accounting Principle .... 547 499 Income Tax Expense .................................................................... 193 171 ------- ------- Income Before Cumulative Effect of Change in Accounting Principle ..................... 354 328 Cumulative Effect of Change in Accounting Principle - Net ............................. -- (59) ------- ------- Net Income ............................................................................ $ 354 $ 269 ======= ======= Earnings per Common Share Basic Before Cumulative Effect of Change in Accounting Principle ....................... $ 1.79 $ 1.63 Cumulative Effect of Change in Accounting Principle - Net ........................ -- (0.29) ------- ------- Net Income ....................................................................... $ 1.79 $ 1.34 ======= ======= Diluted Before Cumulative Effect of Change in Accounting Principle ....................... $ 1.78 $ 1.62 Cumulative Effect of Change in Accounting Principle - Net ........................ -- (0.29) ------- ------- Net Income ....................................................................... $ 1.78 $ 1.33 ======= ======= Basic Common Shares ................................................................... 197 201 ======= ======= Diluted Common Shares ................................................................. 198 202 ======= =======

This statement should be read in conjunction with the attached press release. -6- BURLINGTON RESOURCES INC. SALES VOLUMES AND PRICES

2004 2003 Year Ended ------- ----------------------------------------- ------------------------------ First First Second Third Fourth Quarter Quarter Quarter Quarter Quarter 2003 2002 2001 ------- ------- ------- ------- ------- -------- -------- -------- SALES VOLUMES Gas (MMCF/Day) U.S. 880 867 875 848 870 865 949 1,121 Canada 846 852 868 873 876 867 802 433 Other International 227 153 136 168 211 167 165 170 ------- ------- ------- ------- ------- ------- ------- ------- Worldwide 1,953 1,872 1,879 1,889 1,957 1,899 1,916 1,724 ------- ------- ------- ------- ------- ------- ------- ------- NGLs (MBBLS/Day) U.S. 40.8 35.7 34.6 35.9 43.1 37.4 32.7 34.6 Canada 26.1 28.0 28.5 27.1 26.1 27.4 27.4 12.5 ------- ------- ------- ------- ------- ------- ------- ------- Worldwide 66.9 63.7 63.1 63.0 69.2 64.8 60.1 47.1 ------- ------- ------- ------- ------- ------- ------- ------- Oil (MBBLS/Day) U.S. 32.1 27.6 28.8 30.0 30.7 29.3 35.4 44.0 Canada 5.8 5.1 5.2 5.2 4.9 5.1 7.8 11.9 Other International 44.5 6.6 6.7 12.1 22.9 12.1 5.9 7.3 ------- ------- ------- ------- ------- ------- ------- ------- Worldwide 82.4 39.3 40.7 47.3 58.5 46.5 49.1 63.2 ------- ------- ------- ------- ------- ------- ------- ------- Total Equivalent (MMCFE/D) 2,849 2,490 2,502 2,551 2,723 2,567 2,571 2,386 ------- ------- ------- ------- ------- ------- ------- ------- AVERAGE REALIZED PRICES Gas ($/MCF) U.S. $ 5.52 $ 5.27 $ 4.94 $ 4.91 $ 4.38 $ 4.87 $ 3.39 $ 3.99 Canada 5.53 5.72 5.34 4.90 4.57 5.12 3.17 4.60 Other International 3.69 3.02 2.72 2.46 3.81 3.07 2.27 2.83 ------- ------- ------- ------- ------- ------- ------- ------- Combined including hedging 5.31 5.29 4.96 4.68 4.40 4.83 3.20 4.03 Hedging loss (gain) (0.01) 0.23 0.07 0.04 0.03 0.09 (0.16) 0.48 ------- ------- ------- ------- ------- ------- ------- ------- Combined before hedging $ 5.30 $ 5.52 $ 5.03 $ 4.72 $ 4.43 $ 4.92 $ 3.04 $ 4.51 ------- ------- ------- ------- ------- ------- ------- ------- NGLs ($/BBL) U.S. $ 19.98 $ 19.54 $ 17.26 $ 17.81 $ 18.96 $ 18.42 $ 13.23 $ 14.75 Canada 25.36 25.31 20.07 23.88 23.16 23.08 15.92 22.50 ------- ------- ------- ------- ------- ------- ------- ------- Combined $ 22.08 $ 22.07 $ 18.53 $ 20.42 $ 20.54 $ 20.40 $ 14.46 $ 16.79 ------- ------- ------- ------- ------- ------- ------- ------- Oil ($/BBL) U.S. $ 31.70 $ 30.87 $ 26.93 $ 27.66 $ 27.09 $ 28.08 $ 23.16 $ 22.63 Canada 32.78 35.68 27.96 32.30 28.52 31.11 28.32 26.51 Other International 27.62 20.32 29.74 23.67 22.48 23.49 24.30 23.42 ------- ------- ------- ------- ------- ------- ------- ------- Combined including hedging 29.57 29.74 27.53 27.16 25.40 27.22 24.11 23.45 Hedging loss (gain) 0.32 0.44 -- -- -- 0.09 (0.18) 1.10 ------- ------- ------- ------- ------- ------- ------- ------- Combined before hedging $ 29.89 $ 30.18 $ 27.53 $ 27.16 $ 25.40 $ 27.31 $ 23.93 $ 24.55 ------- ------- ------- ------- ------- ------- ------- -------

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