By Victoria Stilwell
Apache Corp.'s (APA) second-quarter profit sank 72% as revenue declined and the exploration-and-production company booked a $480 million write-down on its Canada oil and gas properties amid historically low natural gas prices.
Results missed expectations.
The company lowered its forecast for production growth, now seeing global growth of 6% to 9% from earlier expectations of 7% to 13%.
Apache has been acquisitive in recent years, adding mature fields from larger rivals. Apache has spent more than $15 billion in the past two years to acquire a series of assets in Egypt, the North Sea, West Texas and the Gulf of Mexico.
In January, Apache agreed to a $2.85 billion deal for privately held Cordillera Energy Partners III LLC, giving it 254,000 acres atop a property known as the Granite Wash, doubling its acreage in the energy field.
Apache also in June said it plans to produce more than 1 million barrels of oil equivalent a day in 2016, with U.S. oil production leading its growth. About 58% of Apache's production will be oil and similar liquids, up from 50% in 2011, the company said.
Apache reported a profit of $356 million, down from a year-earlier profit of $1.26 billion. Per-share earnings, which include the impact of stock dividends, slipped to 86 cents from $3.17.
The latest quarter included a $480 million reduction in the carrying value of its oil and gas properties in Canada stemming from lower natural gas prices. Excluding this item and others, per-share earnings were $2.07, down from $3.22.
Revenue declined 8.4% to $3.97 billion.
Analysts surveyed by Thomson Reuters recently expected per-share earnings of $2.53 on revenue on $4.26 billion.
Average prices, including hedging impacts, decreased 8.1% for oil, 32% for natural gas liquids and 23% for natural gas.
Shares fell 0.9% to $86.04 in recent premarket trade. The stock is off 28% in the past 12 months through Wednesday's close.
Write to Victoria Stilwell at Victoria.Stilwell@dowjones.com
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