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Occidental Petroleum Says Earnings Up 56%

July 23, 2003|Elizabeth Douglass | Times Staff Writer

Boosted by higher oil prices and increased production, Occidental Petroleum Corp. on Tuesday reported 56% higher second-quarter profit on a 21% sales gain.

The Los Angeles company, which is primarily an oil and natural gas producer, said its net income rose to $374 million, or 97 cents a share, for the quarter that ended June 30, compared with $240 million, or 63 cents, for the same quarter last year.

The company's sales were $2.27 billion, up from $1.87 billion a year earlier.

Occidental said the results reflect the quarter's 6% rise in average worldwide output to the equivalent of 544,000 barrels of oil per day, plus strong commodity prices.

In the United States, the company pocketed an average of $26.89 per barrel of oil and $5.46 per thousand cubic feet of natural gas -- increases of 12.6% and 87%, respectively, from prices in the second quarter of last year.

"Overall, things are going well for the company," said Jacques Rousseau, an oil and gas analyst at Friedman Billings Ramsey & Co., which has an "outperform" rating on Occidental shares and doesn't own the stock or have banking business with the oil company.

Special items for the second quarter included an after-tax gain of $14 million on the sale of some Gulf of Mexico assets and $37 million in charges for environmental cleanup, severance and asset write-downs.

In a conference call during trading hours Tuesday, Chairman and Chief Executive Ray R. Irani told analysts that the company was reviewing ways to participate in natural gas production in Saudi Arabia.

He also said the company planned to redeem more than $400 million in 8.16% preferred securities in January.

Occidental shares fell 38 cents Tuesday to $32.45 on the New York Stock Exchange after earnings were announced. The stock is up 14% this year.

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