Kerr-McGee profit doubles on higher prices, fewer items

Wednesday, April 28th 2004, 12:00 am

By: News On 6

OKLAHOMA CITY (Dow Jones/AP) _ Profit at energy and chemicals company Kerr-McGee Corp. more than doubled in the first quarter, thanks to higher prices and lower exploration costs, the company said Wednesday.

Oklahoma City-based Kerr-McGree had net income of $152.2 million, or $1.41 a share, for the latest quarter, compared with $69.9 million, or 68 cents a share, a year ago.

Excluding items, the company said it would have reported earnings of $159.4 million, or $1.48 a share, up from $127.3 million, or $1.20 a share.

Analysts polled by Thomson First Call had been looking for first-quarter earnings, excluding items, of $1.34 a share.

Revenue rose only slightly to $1.12 billion from $1.10 billion.

Earlier this month, Kerr-McGee announced it is buying Denver-based Westport Resources Corp. for about $2.5 billion in stock in a deal that would create one of the nation's biggest independent oil and gas producers.

The acquisition will boost Kerr-McGee's holdings in oil and natural gas reserves in the Rockies and southern Texas.

The company said the higher prices and lower costs that drove earnings were partially offset by lower crude oil volumes, following the sale of certain higher-cost production facilities last year. Gathering and general and administrative costs also rose for the quarter.

Oil production from continuing operations averaged 143,200 barrels a day in the first quarter, down 13 percent from 165,400 barrels a year earlier. Daily average natural gas production was 763 million cubic feet, up slightly from the prior year.

Kerr-McGee said, after hedges, oil prices from continuing operations averaged $27.30 a barrel during the latest quarter, up 33 cents from last year. The average natural gas price was $5.35 per cubic foot, up 14 percent.