APA Q2 Earnings Top as Callon Acquisition Drives Production

Core Viewpoint - APA Corporation reported strong second-quarter 2024 results, with adjusted earnings of $1.17 per share, exceeding expectations and showing year-over-year improvement, primarily driven by increased production from the Callon Petroleum acquisition [1] Financial Performance - Revenues reached $2.8 billion, a 42.4% increase from the previous year, and surpassed the Zacks Consensus Estimate by 20.7% [1] - The company generated $877 million in cash from operating activities and reported an adjusted operating cash flow of $1.1 billion [4] - Free cash flow was $103 million, compared to $94 million in the same quarter last year [4] Production and Pricing - Average production of oil and natural gas was 473,409 BOE/d, up 18.7% year-over-year, exceeding expectations [3] - U.S. output increased by 42.5% year-over-year to 303,416 BOE/d, while international production decreased by 8.7% [3] - Average realized crude oil price was $82.28 per barrel, a 7.7% increase from the previous year, while the average realized natural gas price fell to $1.77 per thousand cubic feet [3] Costs and Expenses - Lease operating expenses totaled $460 million, a 27.4% increase from the previous year, contributing to total operating expenses rising 47.8% to $1.9 billion [4] - The company incurred $839 million in upstream capital expenditures during the quarter [4] Shareholder Returns - APA Corporation continued to reward shareholders with dividends and buybacks, repurchasing 1.5 million shares at $28.72 each and paying out $92 million in dividends [1] Guidance - The company expects adjusted production to average 388,000 BOE/d in Q3 and 387,000 BOE/d for the full year, with upstream capital expenditure pegged at $2.7 billion or more [6]