Murphy Oil Corporation (NYSE: MUR) announced today that income from continuing operations was $295.4 million ($1.52 per diluted share) in the 2012 second quarter, up from $280.0 million ($1.44 per diluted share) in the second quarter 2011. The increase in 2012 earnings from continuing operations was mostly attributable to improved downstream results compared to the prior year’s quarter. Net income in the second quarter of 2012 was also $295.4 million ($1.52 per diluted share) compared to net income of $311.6 million ($1.60 per diluted share) in the second quarter of 2011. Net income in the 2011 second quarter included income from discontinued operations of $31.6 million ($0.16 per diluted share), which related to operating results of two U.S. refineries that were sold in the second half of 2011.
For the first six months of 2012, income from continuing operations was $585.5 million ($3.01 per diluted share), an improvement from $518.5 million ($2.66 per diluted share) in 2011. For the six-month period of 2012, net income totaled the same $585.5 million ($3.01 per diluted share), but net income of $580.5 million ($2.98 per diluted share) for the first six months in 2011 included income from discontinued operations of $62.0 million ($0.32 per diluted share).
|Three Mos. Ended||Six Mos. Ended|
|June 30||June 30|
|(Millions of Dollars)|
|Exploration and Production||$||230.1||243.3||551.7||503.7|
|Refining and Marketing||80.5||60.1||76.3||60.4|
|Income from continuing operations||295.4||280.0||585.5||518.5|
|Income from discontinued operations||–||31.6||–||62.0|
|Income per Common share – Diluted:|
|Income from continuing operations||$||1.52||1.44||3.01||2.66|
Second Quarter 2012 vs. Second Quarter 2011
Exploration and Production (E&P)The Company’s income from E&P operations was $230.1 million in the second quarter of 2012 compared to $243.3 million in the same quarter of 2011. The 2011 quarter included an after-tax gain of $13.1 million associated with the sale of natural gas storage assets in Spain. Income in the 2012 quarter was unfavorably affected by lower average realized sales prices in the current period for the Company’s worldwide oil and North American natural gas production. The just completed quarter also had higher extraction costs, primarily due to the higher oil and gas sales volumes, but also due to higher facility and well maintenance costs and increased production in the Eagle Ford Shale area of South Texas, which has higher capital amortization unit costs compared to the Company’s average. The second quarter of 2012 had higher sales volumes for crude oil and natural gas compared to 2011. Exploration expenses were $96.6 million in the second quarter of 2012 compared to $122.5 million in the same period of 2011, with the reduction in 2012 mainly attributable to a prior year dry hole at the Lengkuas prospect in Indonesia. Dry hole expense was higher in the U.S. in the just completed quarter due to write-off of the unsuccessful Deep Blue prospect in the Gulf of Mexico.