===============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): FEBRUARY 12, 2003
NEWFIELD EXPLORATION COMPANY
(Exact Name of Registrant as Specified in Its Charter)
DELAWARE 1-12534 72-1133047
(State or Other Jurisdiction (Commission File Number) (I.R.S. Employer
of Incorporation) Identification No.)
363 N. SAM HOUSTON PARKWAY E., SUITE 2020
HOUSTON, TEXAS 77060
(Address of Principal Executive Offices)
(281) 847-6000
(Registrant's Telephone Number, Including Area Code)
===============================================================================
ITEM 5. OTHER EVENTS
On February 12, 2003, Newfield Exploration Company ("Newfield" or the
"Company") announced its financial and operating results for the fourth quarter
and full-year 2002. Set forth below is a portion of the press release.
HOUSTON - (FEBRUARY 12, 2003) -- NEWFIELD EXPLORATION COMPANY
(NYSE:NFX) today announced financial and operating results for the fourth
quarter and full-year 2002. A 2003 capital spending budget of $450 million
(excluding acquisitions) also was announced, as well as financial and
operational guidance for the year. The Company will hold a conference call at
8:30 a.m. CST on Thursday, February 13, 2003. To participate in the call,
please visit the Company's web site at www.newfld.com.
Newfield also disclosed that it plans to hold an investor conference
in Houston from 8 a.m. - 2 p.m. on March 19, 2003. Through the Company's
website, slides will be available the day of the conference and a replay will
be made available the next day.
HIGHLIGHTS INCLUDE:
o Replaced 255% of 2002 production. Year-end proved reserves increased
nearly 30% to 1.2 trillion cubic feet equivalent (Tcfe). Asset
diversification continued, with about 54% of the Company's total
reserves now located onshore, 44% in the Gulf of Mexico and 2%
internationally.
o Increased 2002 production volumes 5%. The Company met production
targets in 2002 despite shutting in 4 Bcfe of production in the
second half of the year due to storms in the Gulf of Mexico and
voluntarily curtailing about 1 Bcf of natural gas production in
February in response to low prices.
o Acquired EEX Corporation, significantly increasing acreage and
production in South Texas. The Company also gained an acreage base in
deepwater Gulf of Mexico, a recently added focus area.
o Reduced commodity price volatility in 2002 through hedging and
captured $28.5 million in additional revenue.
o Announced 2003 capital spending budget of $450 million, an increase
of 34% over 2002. The program includes $200 million for exploration -
a record level. Drilling plans include 25-35 wells in Gulf of Mexico
(including 7-10 deep shelf wells and 2-3 deepwater wells), 45-50
wells onshore Gulf Coast, 40-50 wells in the Mid-Continent and one to
three wells overseas.
o Recent recognition: Newfield was nominated for the 2002 National Safe
Award for Excellence (SAFE) by the Minerals Management Service for
its operations in the Gulf of Mexico. The Company won this award in
1997 and was a finalist in 1998 and 2000. Newfield was also
recognized in 2002 as "Best in Class" by the National Association of
Petroleum Investment Analysts (NAPIA) for its corporate governance
and disclosure practices.
2
FOURTH QUARTER 2002 FINANCIAL RESULTS
-------------------------------------
For the fourth quarter of 2002, the Company reported net income of
$34.3 million, or $0.69 per (all per share amounts are on a diluted basis),
stated without the effect of a non-cash charge related to hedging transactions
(SFAS 133) of $3.7 million ($2.4 million after-tax). Stated with the effect of
the charge, net income was $31.9 million, or $0.65 per share. Revenues for the
fourth quarter of 2002 were $199.5 million. Operating cash flow before changes
in working capital in the fourth quarter of 2002 was $130.0 million.
This compares to a net loss in the fourth quarter of 2001 of $39.1
million, or $0.89 per share. The 2001 results include a non-cash impairment
charge of $106.0 million ($68.1 million after tax) and a non-cash gain related
to SFAS 133 of $9.6 million ($6.2 million after-tax). Without the net effect of
these items, net income in the fourth quarter of 2001 was $22.8 million, or
$0.50 per share. Revenues for the fourth quarter of 2001 were $156.1 million.
Operating cash flow before changes in working capital in the fourth quarter of
2001 was $111.1 million.
FOURTH QUARTER 2002 PRODUCTION
------------------------------
Newfield's production in the fourth quarter of 2002 was 48.6 Bcfe, a
10% increase over 2001 production in the same period. Fourth quarter 2002
volumes reflect the shut-in of 2.5 Bcfe due to a storm in the Gulf of Mexico.
Newfield closed its acquisition of EEX Corporation on November 26, 2002, which
contributed approximately 4 Bcfe to fourth quarter production.
The following tables detail production by country and average realized
prices for the fourth quarters of 2002 and 2001.
4Q02 4Q01 % CHANGE
--------------------------------
United States
Natural gas (Bcf) 38.2 31.9 20%
Oil and condensate production (MMBbls) 1.37 1.49 (8%)
Australia
Oil and condensate liftings (MMBbls) 0.376 0.535 (30%)
Total Production (Bcfe) 48.6 44.0 10%
FOURTH QUARTER AVERAGE REALIZED PRICES*
---------------------------------------
4Q02 4Q01 % CHANGE
--------------------------------
United States
Natural gas (per Mcf) $3.98 $3.47 15%
Oil and condensate (per Bbl) $26.21 $22.54 16%
Australia
Oil and condensate liftings (per Bbl) $28.12 $19.34 45%
Total per Mcfe $4.08 $3.51 16%
-------------------------------------------------------------------------------
*Prices shown are net of transportation expense and after realized gains and
losses from hedging. The Company has not entered into hedging transactions
specifically relating to Australian production.
Stated on a unit of production basis, Newfield's lease operating
expense (LOE) in the fourth quarter of 2002 was flat with the same period of
2001 at $0.66 per Mcfe. Higher commodity prices contributed to significantly
higher production taxes in the fourth quarter. Production taxes in the fourth
quarter of 2002 (including resource rent tax in Australia) increased to $0.09
per Mcfe compared to $0.04 per Mcfe in the same period of 2001. DD&A expense,
stated on a unit of production basis, in the fourth quarter of 2002 was $1.68
per Mcfe compared to $1.72 per Mcfe in the fourth quarter of 2001. DD&A during
2002 was slightly lower as a result of the ceiling test writedown in the fourth
quarter of 2001. At year-end 2002, the Company's DD&A rate was $1.71 per Mcfe,
which includes the effects of the EEX transaction under purchase accounting.
3
FULL-YEAR 2002 FINANCIAL RESULTS
--------------------------------
For 2002, Newfield posted net income of $92.8 million, or $1.99 per
share, stated before the effect of a non-cash charge related to SFAS 133 of
$29.1 million ($18.9 million after-tax). Stated after the effect of the
non-cash charge, net income for 2002 was $73.8 million, or $1.61 per share.
Revenues in 2002 were $661.8 million, a 12% decrease from 2001 revenues.
Operating cash flow before changes in working capital in 2002 was $412.6
million.
For 2001, Newfield earned $119.0 million, or $2.56 per share, after a
non-cash impairment charge of $106.0 million ($68.1 million after-tax), a
non-cash gain and a cumulative effect of change in accounting principle related
to the adoption of SFAS 133 of $20.0 million ($11.3 million after-tax). Without
the net effect of these items, net income was $175.7 million, or $3.72 per
share. Revenues in 2001 were $749.4 million. Operating cash flow before changes
in working capital in 2001 was $526.8 million.
2002 PRODUCTION
---------------
Production volumes in 2002 increased 5% over 2001 and totaled 184.1
Bcfe. Production was negatively impacted by two factors: About 4 Bcfe was
shut-in in the second half of 2002 due to storms in the Gulf of Mexico, and, in
February 2002, approximately 1 Bcf was curtailed in response to low gas prices.
2002 2001 % CHANGE
--------------------------------
United States
Natural gas (Bcf) 144.7 133.2 9%
Oil and condensate production (MMBbls) 5.2 5.5 (5%)
Australia
Oil and condensate liftings (MMBbls) 1.34 1.48 (9%)
Total Production (Bcfe) 184.1 175.2 5%
2002 AVERAGE REALIZED PRICES*
2002 2001 % CHANGE
------------------------------------------
United States
Natural gas (per Mcf) $3.42 $4.32 (21%)
Oil and condensate (per Bbl) $24.22 $24.01 1%
Australia
Oil and condensate liftings (per Bbl) $26.05 $23.96 9%
Total per Mcfe $3.56 $4.25 (16%)
---------------------------------
*Prices shown net of transportation expense and after realized gains and losses
from hedging. The Company has not entered into hedging transactions
specifically relating to Australian production.
Stated on a unit of production basis, Newfield's LOE in 2002 decreased
to $0.57 per Mcfe compared to $0.59 per Mcfe in 2001. Production taxes in 2002,
including resource rent tax in Australia, were $0.09 per Mcfe compared to $0.10
per Mcfe in 2001. DD&A expense in 2002 increased on a unit of production basis
to $1.65 per Mcfe compared to $1.61 per Mcfe in the prior year. The increase in
DD&A expense is primarily related to the cost of reserve additions and the
acquisition of EEX in late 2002.
FINDING AND DEVELOPMENT COSTS
-----------------------------
United States: Excluding the acquisition of EEX, Newfield added 181.2
Bcfe with its core domestic program, replacing 105% of 2002 production
(excluding a 4 Bcfe contribution from EEX in late 2002). Total domestic
investment was $308.8 million, including other acquisitions made primarily to
capture drilling opportunities. U.S. finding and development costs for 2002
were $1.70 per Mcfe.
4
"Our domestic finding and development costs were in line with our
targets and well below last year," said Trice. "I am particularly pleased with
the results posted by our Gulf of Mexico teams, which added substantial
reserves below their targeted unit costs. Successful results from our deep
shelf drilling program contributed to our lower unit costs."
EEX Acquisition: Under purchase accounting, $571.5 million of the
acquisition's total consideration was allocated to EEX's oil and gas
properties. Of this amount, $88.5 million (16%) has been assigned to unproved
properties, undeveloped leasehold (including 59 deepwater blocks and 29 shelf
blocks associated with the deep exploratory concept known as Treasure Island)
and fee minerals interests. As of closing, Newfield booked 287.8 Bcfe of proved
reserves attributable to the EEX properties. During 2002, EEX's onshore
drilling program was focused on developing proved undeveloped reserves rather
than finding new reserves.
International: Newfield invested $28 million in international
operations in 2002, mainly in China and Australia where expenditures were
related to appraisal of the 12-1 South Field in Bohai Bay and the Montara
Field, offshore Australia. Neither of these projects has yet been sanctioned
for development and, accordingly, no reserves have been booked for these
properties.
RESERVE REPLACEMENT AND PROVED RESERVES
---------------------------------------
During 2002, Newfield's worldwide reserve replacement was 255% of
total production of 184.1 Bcfe. The Company's reserve replacement in 2001 was
242% of total production. 2002 marks the 13th consecutive year that Newfield
has more than replaced annual production with proved reserves.
At the end of 2002, Newfield had proved reserves of 1.2 Tcfe, which is
net of the impact of U.S. property sales of approximately 16 Bcfe. Proved
reserves at year-end 2002 increased nearly 30% over 2001 proved reserves of 936
Bcfe. At year-end 2002, Newfield's reserves were 81% natural gas compared to
77% natural gas at year-end 2001. Approximately 83% of the Company's domestic
reserves are natural gas and 98% of the Company's total proved reserves are
located in the U.S. Only 7% of Newfield's proved reserves are "proved
undeveloped," among the lowest percentage in the industry.
5
CONSOLIDATED STATEMENT OF INCOME FOR THE FOR THE
------------------------------------------------------- THREE MONTHS ENDED TWELVE MONTHS ENDED
(UNAUDITED, IN 000'S, EXCEPT PER SHARE DATA) DECEMBER 31, DECEMBER 31,
---------------------------------- -----------------------------------
2002 2001 2002 2001
----------------- ---------------- ---------------- -----------------
OIL AND GAS REVENUES $ 199,490 $ 156,073 $ 661,750 $ 749,405
----------------- ---------------- ---------------- -----------------
OPERATING EXPENSES:
Lease operating 32,036 29,103 105,860 102,922
Production and other taxes 4,380 1,631 17,286 17,523
Transportation 1,331 1,419 5,708 5,569
Depreciation, depletion and amortization 81,746 75,585 303,274 282,567
Ceiling test write-down - 106,011 - 106,011
General and administrative 16,298 7,872 53,316 41,204
Stock compensation 735 724 2,801 2,751
----------------- ---------------- ---------------- -----------------
TOTAL OPERATING EXPENSES 136,526 222,345 488,245 558,547
----------------- ---------------- ---------------- -----------------
INCOME (LOSS) FROM OPERATIONS 62,964 (66,272) 173,505 190,858
OTHER INCOME (EXPENSES):
Interest expense (13,158) (7,339) (34,555) (27,859)
Capitalized interest 2,286 2,383 8,839 8,891
Dividends on preferred securities of
Newfield Financial Trust I (2,336) (2,336) (9,344) (9,344)
Unrealized commodity derivative income (expense)* (3,670) 9,559 (29,147) 24,821
Other (328) 2,535 1,587 3,993
----------------- ---------------- ---------------- -----------------
(17,206) 4,802 (62,620) 502
----------------- ---------------- ---------------- -----------------
INCOME (LOSS) BEFORE INCOME TAXES 45,758 (61,470) 110,885 191,360
----------------- ---------------- ---------------- -----------------
Income tax provision (benefit) 13,878 (22,360) 37,038 67,612
----------------- ---------------- ---------------- -----------------
Cumulative effect of change in accounting principles* - - - (4,794)
----------------- ---------------- ---------------- -----------------
NET INCOME (LOSS) $ 31,880 $ (39,110) $ 73,847 $ 118,954
================= ================ ================ =================
EARNINGS (LOSS) PER SHARE:
BASIC $ 0.68 $ (0.89) $ 1.64 $ 2.69
================= ================ ================ =================
DILUTED $ 0.65 $ (0.89) $ 1.61 $ 2.56
================= ================ ================ =================
WEIGHTED AVERAGE SHARES OUTSTANDING
FOR BASIC EARNINGS (LOSS) PER SHARE 47,227 44,018 45,096 44,258
WEIGHTED AVERAGE SHARES OUTSTANDING
FOR DILUTED EARNINGS (LOSS) PER SHARE 51,713 44,018** 49,589 48,894
PRODUCTION DATA FOR THE FOR THE
THREE MONTHS ENDED TWELVE MONTHS ENDED
DECEMBER 31, DECEMBER 31,
---------------------------------- -----------------------------------
2002 2001 2002 2001
----------------- ---------------- ---------------- -----------------
Average daily production:
Oil and condensate (Bbls) 18,935 21,996 17,997 19,173
Gas (Mcf) 414.7 346.5 396.4 364.8
Average realized price:
Oil and condensate (Bbls) $ 26.63 $ 21.70 $ 24.60 $ 24.00
Gas (Mcf) $ 3.98 $ 3.47 $ 3.42 $ 4.32
---------------
* Associated with SFAS 133.
** Absent a loss in this period, the outstanding shares would have been 48,552.
6
CONSOLIDATED BALANCE SHEET DECEMBER 31, DECEMBER 31,
(UNAUDITED, IN THOUSANDS OF DOLLARS) 2002 2001
---------------- -----------------
ASSETS
Current assets:
Cash & cash equivalents $ 48,898 $ 26,610
Accounts receivable, oil and gas 130,489 92,644
Inventories 7,910 7,332
Commodity derivatives * 2,464 79,012
Deferred taxes 12,801 -
Other current assets 36,074 25,006
---------------- -----------------
Total current assets 238,636 230,604
---------------- -----------------
Oil and gas properties, net (full cost method) 2,010,005 1,408,579
Assets held for sale 35,000 -
Furniture, fixtures and equipment, net 8,030 6,807
Commodity derivatives * 4,439 7,409
Other assets 19,452 9,972
---------------- -----------------
$ 2,315,562 $ 1,663,371
================ =================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities $ 256,099 $ 160,814
Commodity derivatives * 39,517 4,217
---------------- -----------------
Total current liabilities 295,616 165,031
---------------- -----------------
Other liabilities 16,976 6,288
Commodity derivatives * 10,610 1,813
Long-term debt 709,615 428,631
Deferred taxes 129,309 207,880
---------------- -----------------
Total long-term liabilities 866,510 644,612
---------------- -----------------
Company-obligated, mandatorily redeemable,
convertible preferred securities of Newfield
Financial Trust I 143,750 143,750
---------------- -----------------
Minority Interest 455 -
---------------- -----------------
STOCKHOLDERS' EQUITY
Common stock 526 449
Additional paid-in capital 636,317 364,734
Treasury stock (26,213) (25,794)
Unearned compensation (6,479) (7,845)
Accumulated other comprehensive income (loss)
Foreign currency translation adjustment (3,888) (8,918)
Commodity derivatives * (27,295) 24,936
Retained earnings 436,263 362,416
---------------- -----------------
Total stockholders' equity 1,009,231 709,978
---------------- -----------------
Total liabilities and stockholders' equity $ 2,315,562 $ 1,663,371
================ =================
---------------
* Associated with SFAS 133.
7
CONSOLIDATED STATEMENT OF FOR THE FOR THE
CASH FLOWS THREE MONTHS ENDED TWELVE MONTHS ENDED
(UNAUDITED, IN THOUSANDS OF DOLLARS) DECEMBER 31, DECEMBER 31,
----------------------------------- -------------------------------------
2002 2001 2002 2001
---------------- ----------------- ------------------- -----------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 31,880 $ (39,110) $ 73,847 $ 118,954
Depreciation, depletion and amortization 81,746 75,585 303,274 282,567
Deferred taxes 11,927 (22,506) 3,515 36,505
Stock compensation 735 724 2,801 2,751
Unrealized commodity derivative * 3,670 (9,559) 29,147 (24,821)
Cumulative effect of change in
accounting principle - - - 4,794
Ceiling test write-down - 106,011 - 106,011
---------------- ----------------- ------------------- -----------------
129,958 111,145 412,584 526,761
Changes in operating assets and liabilities (21,862) (71,864) (9,125) (24,389)
---------------- ----------------- ------------------- -----------------
NET CASH PROVIDED BY OPERATING ACTIVITIES 108,096 39,281 403,459 502,372
---------------- ----------------- ------------------- -----------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition, net of cash acquired (204,411) - (204,411) (264,089)
Additions to oil and gas properties (77,459) (79,804) (311,045) (497,610)
Additions to furniture, fixtures and equipment (408) (655) (2,657) (4,123)
---------------- ----------------- ------------------- -----------------
NET CASH USED IN INVESTING ACTIVITIES (282,278) (80,459) (518,113) (765,822)
---------------- ----------------- ------------------- -----------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings 164,700 378,000 654,700 1,488,000
Repayments of borrowings (189,700) (343,000) (747,700) (1,368,000)
Deliveries under the gas sales obligation (1,672) - (1,672) -
Proceeds from issuance of senior notes 247,920 - 247,920 174,879
Proceeds from issuances of common stock, net 1,957 1,848 7,787 3,643
Purchase of secured notes payable (23,586) - (23,586) -
Purchases of treasury stock (53) (43) (419) (25,395)
---------------- ----------------- ------------------- -----------------
NET CASH PROVIDED BY FINANCING ACTIVITIES 199,566 36,805 137,030 273,127
---------------- ----------------- ------------------- -----------------
Effect of exchange rate changes on cash
and cash equivalents (180) (2,211) (88) (1,518)
---------------- ----------------- ------------------- -----------------
Increase (decrease) in cash and cash equivalents 25,204 (6,584) 22,288 8,159
Cash and cash equivalents, beginning of period 23,694 33,194 26,610 18,451
---------------- ----------------- ------------------- -----------------
Cash and cash equivalents, end of period $ 48,898 $ 26,610 $ 48,898 $ 26,610
================ ================= =================== =================
---------------
* Associated with SFAS 133.
8
ITEM 9. REGULATION FD DISCLOSURE
On February 12, 2003, Newfield issued a press release that contained
2003 planned capital spending, production estimates for the full-year 2003 and
estimates for significant operating and financial data for the first quarter of
2003.
2003 PLANNED CAPITAL SPENDING
-----------------------------
Newfield announced a 2003 capital budget of $450 million. The Company
expects that approximately 55 - 60% of the budget will be invested in the Gulf
of Mexico (including deepwater), 35 - 40% onshore U.S. and the balance on
international projects.
Trice said, "We announced an increased capital budget in 2003, which
reflects the quality and depth of our inventory. Despite our higher budget, we
estimate that cash flow will exceed the budget by $100 - 150 million, based on
our current hedges and today's market prices. We should have the flexibility to
pay down bank debt, repurchase some of our common stock or make a meaningful
acquisition."
2003 ESTIMATES
--------------
Below are production estimates for the full-year 2003 and estimates
for significant operating and financial data for the first quarter of 2003.
Although the Company believes the expectations reflected in this
forward-looking information are reasonable, such expectations are based upon
assumptions and anticipated results that are subject to numerous uncertainties.
Please see the discussion regarding forward-looking information set forth
below.
2003 PRODUCTION Newfield expects its 2003 production to be in the
range of 215 - 225 Bcfe, an increase of 17 - 22% over 2002 production of 184.1
Bcfe. Newfield's 2003 production forecast does not include any production that
may result from exploration success. Approximately 80% of production is
expected to be natural gas (166 - 184 Bcfe, or an average of 455 - 504 MMcf/d).
Crude oil, including 1.1 - 1.3 MMBbls from Australia, should total 6.7 - 7.4
MMBbls, or an average of 18,400 - 20,400 BOPD in 2003.
About 53% of Newfield's production in 2003 is expected to come from
the Gulf of Mexico, its largest focus area. Approximately 32% of its total
production in 2003 is expected to come from the onshore Gulf Coast region. The
Mid-Continent region accounts for about 12% of expected 2003 production. About
3% of Newfield's production is expected to come from Australia, all of which is
crude oil.
FIRST QUARTER 2003 ESTIMATES
----------------------------
NATURAL GAS PRODUCTION AND PRICING Newfield's natural gas production
in the first quarter of 2003 is expected to be 42 - 46 Bcf (462 - 510 MMcf/d).
The price received by the Company for its natural gas production from the Gulf
of Mexico and onshore Gulf Coast has typically tracked the Henry Hub Index. Gas
from the Company's Mid-Continent properties has typically sold at a discount of
$0.12 - $0.15 per Mcfe to Henry Hub. Hedging gains or losses will affect price
realizations.
CRUDE OIL PRODUCTION AND PRICING Consolidated oil production in the
first quarter of 2003 is expected to be 1.7 - 1.9 million barrels (18,600 -
20,600 BOPD). Australian oil production during the first quarter is expected to
be 325 - 360 thousand barrels (3,500 - 3,900 BOPD). The timing of liftings in
Australia will impact reported production and revenues. The price the Company
receives from its Gulf Coast production has typically averaged about $2 below
the NYMEX WTI price. Oil production from the Mid-Continent has typically sold
at a $1.00 - $1.50 per barrel discount to West Texas Intermediate (WTI).
Australian crude oil sales are based on the Tapis Benchmark, which has
historically been comparable to WTI. Hedging gains or losses will affect price
realizations.
LEASE OPERATING AND OTHER EXPENSES Newfield's LOE is expected to be
$32 - $35 million ($0.59 - $0.65 per Mcfe) in the first quarter of 2003. The
Company's domestic LOE is expected to be $28 - $31 million ($0.52 - $0.58 per
Mcfe). Production taxes in the first quarter of 2003 (including resource rent
tax in Australia) is expected to be $14 - $16 million ($0.26 - $0.28 per Mcfe).
Higher LOE in the first quarter relates to non-recurring expenses, primarily
workovers, scheduled for the first quarter. LOE varies and is subject to impact
from, among other things, production volumes and commodity pricing, tax rates,
service costs, the costs of goods and materials and workover activities.
9
GENERAL AND ADMINISTRATIVE EXPENSE Newfield's G&A expense for the
first quarter of 2003 is expected to be $14 - $18 million ($0.25 - $0.32 per
Mcfe) including stock and incentive compensation, which depends largely on
Newfield's net income.
INTEREST EXPENSE The non-capitalized portion of the Company's interest
expense for the first quarter of 2003 is expected to be $12 - $13 million
($0.22 - $0.24 per Mcfe), including a $2.3 million payment on its convertible
trust preferred securities. Current borrowings under the Company's bank
facilities are $36 million. The remainder of long-term debt consists of three
separate issuances of senior notes that in the aggregate total $575 million.
Capitalized interest for the first quarter of 2003 is expected to be about $2 -
$3 million.
INCOME TAXES Including both current and deferred taxes, the Company
expects its consolidated income tax rate in the first quarter of 2003 to be
about 35 - 38%. About 40% of the tax provision is expected to be deferred.
The Company provides information regarding its outstanding hedging
positions in its annual report and quarterly reports filed with the SEC and in
its electronic publication -- @NFX. This publication can be found on the
Company's web page at http://www.newfld.com. Through the web page, interested
persons may elect to receive @NFX through e-mail distribution.
FORWARD-LOOKING INFORMATION
Certain of the statements set forth in this release regarding
estimated or anticipated 2003 results, capital spending and activity levels and
production forecasts are forward-looking and based upon assumptions and
anticipated results that are subject to numerous uncertainties. Actual results
may vary significantly from those anticipated due to many factors, including
drilling results, oil and gas prices, industry conditions, the prices of goods
and services, the availability of drilling rigs and other support services and
the availability of capital resources, labor conditions and other factors set
forth in our Annual Report on Form 10-K for the year ended December 31, 2001.
In addition, the drilling of oil and gas wells and the production of
hydrocarbons are subject to governmental regulations and operating risks.
10
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this Form 8-K to be signed on its behalf by the
undersigned hereunto duly authorized.
NEWFIELD EXPLORATION COMPANY
Date: February 13, 2003 By: /s/ BRIAN L. RICKMERS
-----------------------------
Brian L. Rickmers
Controller
11