Exhibit 99.1

 

		NEWS RELEASE

APA Corporation Announces Fourth-Quarter and

Full-Year 2024 Financial and Operational Results

2024 Highlights

 

•

Delivered full-year net cash provided by operating activities of $3.6 billion, adjusted EBITDAX of $5.9 billion, and $841 million of free cash flow (FCF);

 

•

Returned $599 million to shareholders or 71% of FCF;

 

•

Transformed Permian portfolio through the acquisition of Callon Petroleum Company and the sale of conventional Central Basin Platform assets; realized an initial 22% reduction in breakeven oil price on Callon Delaware acreage;

 

•

Achieved final investment decision for the GranMorgu Phase 1 project in Suriname Block 58 with partner TotalEnergies; and

 

•

Signed a new gas price agreement in Egypt, bringing gas-focused investment to economic parity with oil.

2025 Outlook

 

•

Planning upstream capital budget of $2.5 to $2.6 billion; includes $200 million for GranMorgu development and $100 million for exploration;

 

•

Total adjusted production expected to be 396,000 barrels of oil equivalent (BOE) per day; 3% higher than 2024;

 

•

Implementing cost-saving initiatives across overhead, lease operating expense (LOE) and capital, targeting $350 million in run-rate savings by year-end 2027; and

 

•

Committed to returning at least 60% of FCF to shareholders.

HOUSTON, Feb. 26, 2025 – APA Corporation (Nasdaq: APA) today announced its financial and operational results for the fourth quarter and full-year 2024.

In the fourth quarter, APA reported net income attributable to common stock of $354 million or $0.96 per diluted common share. When adjusting for items that impact the comparability of results, APA’s fourth-quarter earnings were $290 million, or $0.79 per diluted share. Net cash provided by operating activities was $1.0 billion, and adjusted EBITDAX was $1.6 billion.

Fourth-quarter reported production was 488,000 BOE per day. Adjusted production, excluding Egypt noncontrolling interest and tax barrels, was 418,000 BOE per day.

For the full-year 2024, APA reported net income attributable to common stock of $804 million, or $2.27 per diluted common share. On an adjusted basis, APA’s 2024 earnings totaled $1.3 billion or $3.77 per diluted common share. Reported full-year production was 455,000 BOE per day; adjusted production was 385,000 BOE per day. Full-year net cash provided by operating activities was $3.6 billion, and adjusted EBITDAX was $5.9 billion.

 

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APA CORPORATION ANNOUNCES FOURTH-QUARTER AND FULL-YEAR 2024 FINANCIAL AND OPERATIONAL RESULTS

 

During the year, APA generated $841 million of free cash flow, repurchased $246 million of common stock, and paid $353 million in dividends. The company ended the year with debt of $6 billion and cash of $625 million, an increase in net debt of only $300 million from the end of 2023, despite adding over $2 billion of debt with the Callon acquisition.

CEO Commentary

“Over the last several years, APA has been strategically reshaped in numerous ways. We have enhanced the quality and sustainability of the portfolio in our core areas of the Permian Basin and the Western Desert of Egypt, while also building optionality through a differentiated exploration strategy,” said John J. Christmann IV, APA’s chief executive officer.

“In 2024, we continued this momentum with the acquisition of Callon, the final investment decision for the GranMorgu project in Suriname, and the new gas agreement in Egypt. These actions have further strengthened our portfolio and improved the quality of our investment opportunities, positioning APA for long-term growth and success. We have assembled a large-scale unconventional position in the Permian Basin, surpassing many of our pure-play peers. In addition, we made further progress on strengthening our balance sheet, achieving investment-grade status with all three rating agencies.”

2025 Capital Budget and Outlook

In 2025, APA plans to invest $2.5 to $2.6 billion in upstream oil and gas capital. This includes $200 million toward progressing the GranMorgu project in Suriname and $100 million for exploration activities, predominantly in Alaska.

Total company adjusted production is expected to be relatively flat year-over-year at around 396,000 BOE per day. U.S. oil volumes should stay relatively consistent at 125,000 to 127,000 barrels of oil per day, and gas volumes will benefit from no price-related curtailments. In Egypt, gross production is expected to decline modestly, while adjusted volumes should grow slightly year-over-year, to 69,000 BOE per day compared to 67,500 BOE per day in 2024.

 

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APA CORPORATION ANNOUNCES FOURTH-QUARTER AND FULL-YEAR 2024 FINANCIAL AND OPERATIONAL RESULTS

 

“Our 2025 plan builds on the progress achieved in 2024,” continued Christmann. “Through inventory expansion in the Permian Basin and the renegotiation of both oil and gas economics in Egypt, we have positioned our core producing portfolio to deliver steady and predictable production. We expect to run eight rigs in the Permian and 12 rigs in Egypt, leading to a slight increase year-over-year in Permian and adjusted Egypt volumes. This activity set translates to a combined development capital budget for Permian and Egypt of $2.2-$2.3 billion, 17% lower than 2024 development capital when adjusting for Callon’s first-quarter 2024 spend.”

Additionally, APA is undertaking significant cost reduction initiatives aimed at streamlining the business and improving operating practices. The company is targeting at least $350 million in sustainable annual savings by the end of 2027 across LOE, capital and overhead.

“Our cost reduction efforts follow the strategic realignment of our portfolio over the last few years. Our objective is to return our cost structure to a leading position by streamlining every aspect of the business while enhancing the predictability and delivery of our long-term plan. We are confident that our disciplined approach to capital allocation and rigorous cost management will underpin strong free cash flow growth over the next few years, which will be further bolstered by the GranMorgu project in Suriname, with first oil in 2028,” Christmann concluded.

Year-End 2024 Proved Reserves

Worldwide estimated proved reserves totaled 969 million BOE at year-end 2024, 69% of which were classified as proved developed.

Conference Call

APA will host a conference call to discuss its fourth-quarter and full-year 2024 results at 10 a.m. Central time, Thursday, Feb. 27. The conference call will be webcast from APA’s website at www.apacorp.com and investor.apacorp.com. Following the conference call, a replay will be available for one year on the “Investors” page of the company’s website.

About APA

APA Corporation owns consolidated subsidiaries that explore for and produce oil and natural gas in the United States, Egypt and the United Kingdom and that explore for oil and natural gas offshore Suriname and elsewhere. APA posts announcements, operational updates, investor information and press releases on its website, www.apacorp.com.

 

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APA CORPORATION ANNOUNCES FOURTH-QUARTER AND FULL-YEAR 2024 FINANCIAL AND OPERATIONAL RESULTS

 

Additional Information

Additional information follows, including reconciliations of adjusted earnings, adjusted EBITDAX, upstream capital investment, net debt, cash flows from operations before changes in operating assets and liabilities and free cash flow (non-GAAP financial measures) to GAAP measures and information regarding adjusted production. APA’s quarterly supplement is available at http://www.apacorp.com/financialdata.

Non-GAAP Financial Measures

APA’s financial information includes information prepared in conformity with generally accepted accounting principles (GAAP) as well as non-GAAP financial information. It is management’s intent to provide non-GAAP financial information to enhance understanding of our consolidated financial information as prepared in accordance with GAAP. Adjusted earnings, adjusted EBITDAX, upstream capital investment, net debt, cash flows from operations before changes in operating assets and liabilities and free cash flow are non-GAAP measures. This non-GAAP information should be considered by the reader in addition to, but not instead of, the financial statements prepared in accordance with GAAP. Each non-GAAP financial measure is presented along with the corresponding GAAP measure so as not to imply that more emphasis should be placed on the non-GAAP measure.

Forward-Looking Statements

This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements can be identified by words such as “anticipates,” “intends,” “plans,” “seeks,” “believes,” “continues,” “could,” “estimates,” “expects,” “goals,” “guidance,” “may,” “might,” “outlook,” “possibly,” “potential,” “projects,” “prospects,” “should,” “will,” “would,” and similar references to future periods, but the absence of these words does not mean that a statement is not forward-looking. These statements include, but are not limited to, statements about future plans, expectations, and objectives for operations, including statements about our capital plans, drilling plans, production expectations, asset sales, and monetizations. While forward-looking statements are based on assumptions and analyses made by us that we believe to be reasonable under the circumstances, whether actual results

 

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APA CORPORATION ANNOUNCES FOURTH-QUARTER AND FULL-YEAR 2024 FINANCIAL AND OPERATIONAL RESULTS

 

and developments will meet our expectations and predictions depend on a number of risks and uncertainties which could cause our actual results, performance, and financial condition to differ materially from our expectations. See “Risk Factors” in APA’s Form 10-K for the year ended December 31, 2023, and in our quarterly reports on Form 10-Q (and in APA’s Form 10-K for the year ended December 31, 2024, when filed) for a discussion of risk factors that affect our business. Any forward-looking statement made in this news release speaks only as of the date on which it is made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. APA and its subsidiaries undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future development or otherwise, except as may be required by law.

Cautionary Note to Investors

The United States Securities and Exchange Commission permits oil and gas companies, in their filings with the SEC, to disclose only proved, probable, and possible reserves that meet the SEC’s definitions for such terms. APA may use certain terms in this news release, such as “resources,” “potential resources,” “resource potential,” “estimated net reserves,” “recoverable reserves,” and other similar terms that the SEC guidelines strictly prohibit APA from including in filings with the SEC. Such terms do not take into account the certainty of resource recovery, which is contingent on exploration success, technical improvements in drilling access, commerciality, and other factors, and are therefore not indicative of expected future resource recovery and should not be relied upon. Investors are urged to consider carefully the disclosure in APA’s Annual Report on Form 10-K for the fiscal year ended Dec. 31, 2023 and in APA’s Form 10-K for the year ended December 31, 2024, when filed, available from APA at www.apacorp.com or by writing APA at: 2000 W. Sam Houston Pkwy S, Ste. 200, Houston, TX 77042 (Attn: Corporate Secretary). You can also obtain this report from the SEC by calling 1-800-SEC-0330 or from the SEC’s website at www.sec.gov.

Contacts

Investor: (281) 302-2286

Media:  (713) 296-7276

Website: www.apacorp.com

APA-F

-end-

 

Page 5 of 5

APA CORPORATION

STATEMENT OF CONSOLIDATED OPERATIONS

(Unaudited)

(In millions, except per share data)

 

		For the Quarter Ended								For the Year Ended
		December 31,								December 31,
		2024				2023				2024				2023
REVENUES AND OTHER:
Oil, natural gas, and natural gas liquids production revenues
Oil revenues		$	1,830			$	1,530			$	6,966			$	5,997
Natural gas revenues			170				222				584				880
Natural gas liquids revenues			189				133				646				508
			2,189				1,885				8,196				7,385
Purchased oil and gas sales			523				282				1,541				894
Total revenues			2,712				2,167				9,737				8,279
Derivative instrument gain (loss), net			7				(5	)			(10	)			99
Gain on divestitures, net			5				1				289				8
Loss on previously sold Gulf of America properties			(190	)			(212	)			(273	)			(212	)
Other, net			(32	)			(59	)			(6	)			18
			2,502				1,892				9,737				8,192
OPERATING EXPENSES:
Lease operating expenses			474				360				1,690				1,436
Gathering, processing, and transmission			104				89				432				334
Purchased oil and gas costs			382				184				1,047				742
Taxes other than income			65				44				270				207
Exploration			65				51				313				195
General and administrative			102				75				372				351
Transaction, reorganization, and separation			12				4				168				15
Depreciation, depletion, and amortization:
Oil and gas property and equipment			646				414				2,235				1,500
Other assets			7				9				31				40
Asset retirement obligation accretion			36				30				148				116
Impairments			18				15				1,129				61
Financing costs, net			91				77				367				312
			2,002				1,352				8,202				5,309
NET INCOME BEFORE INCOME TAXES			500				540				1,535				2,883
Current income tax provision			308				316				1,153				1,338
Deferred income tax benefit			(233	)			(1,640	)			(736	)			(1,662	)
NET INCOME INCLUDING NONCONTROLLING INTERESTS			425				1,864				1,118				3,207
Net income attributable to noncontrolling interest			71				91				314				352
NET INCOME ATTRIBUTABLE TO COMMON STOCK		$	354			$	1,773			$	804			$	2,855
NET INCOME PER COMMON SHARE:
Basic		$	0.96			$	5.79			$	2.28			$	9.26
Diluted		$	0.96			$	5.78			$	2.27			$	9.25
WEIGHTED-AVERAGE NUMBER OF COMMON SHARES OUTSTANDING:
Basic			369				306				353				308
Diluted			369				307				353				309
DIVIDENDS DECLARED PER COMMON SHARE		$	0.25			$	0.25			$	1.00			$	1.00

 

Page 1

APA CORPORATION

PRODUCTION INFORMATION

 

		For the Quarter Ended												% Change								For the Year Ended
		December 31,				September 30,				December 31,				4Q24 to				4Q24 to				December 31,				December 31,
		2024				2024				2023				3Q24				4Q23				2024				2023
OIL VOLUME - Barrels per day
United States			147,573				143,299				83,909				3%				76%				128,531				78,889
Egypt (1, 2)			89,927				91,673				92,365				-2%				-3%				89,027				89,129
North Sea			27,683				21,334				30,748				30%				-10%				26,340				34,728
International (1)			117,610				113,007				123,113				4%				-4%				115,367				123,857
Total (1)			265,183				256,306				207,022				3%				28%				243,898				202,746
NATURAL GAS VOLUME - Mcf per day
United States			511,587				467,615				462,498				9%				11%				483,446				452,281
Egypt (1, 2)			300,118				300,418				309,814				0%				-3%				291,011				325,778
North Sea			36,842				18,911				58,054				95%				-37%				39,986				50,284
International (1)			336,960				319,329				367,868				6%				-8%				330,997				376,062
Total (1)			848,547				786,944				830,366				8%				2%				814,443				828,343
NGL VOLUME - Barrels per day
United States			80,390				79,474				67,679				1%				19%				73,877				62,997
North Sea			1,311				543				1,335				141%				-2%				1,201				1,240
Total (1)			81,701				80,017				69,014				2%				18%				75,078				64,237
BOE per day
United States			313,227				300,709				228,671				4%				37%				282,983				217,266
Egypt (1, 2)			139,947				141,742				144,001				-1%				-3%				137,529				143,425
North Sea			35,134				25,029				41,758				40%				-16%				34,204				44,349
International (1)			175,081				166,771				185,759				5%				-6%				171,733				187,774
Total (1)			488,308				467,480				414,430				4%				18%				454,716				405,040
Total excluding noncontrolling interests			441,618				420,199				366,352				5%				21%				408,838				357,184
(1) Includes net production volumes attributed to our noncontrolling partner in Egypt below:
Oil (b/d)			30,002				30,579				30,837												29,698				29,739
Gas (Mcf/d)			100,127				100,210				103,443												97,078				108,703
BOE per day			46,690				47,281				48,078												45,878				47,856
(2) Egypt Gross Production
Oil (b/d)			134,504				136,670				141,953												137,150				141,985
Gas (Mcf/d)			438,052				447,173				466,403												443,551				500,080
BOE per day			207,513				211,199				219,687												211,075				225,332

 

Page 2

APA CORPORATION

ADJUSTED PRODUCTION INFORMATION

Adjusted production excludes certain items that management believes affect the comparability of operating results for the periods presented. Adjusted production excludes production attributable to 1) noncontrolling interest in Egypt and 2) Egypt tax barrels. Management uses adjusted production to evaluate the company’s operational trends and performance and believes it is useful to investors and other third parties.

 

		For the Quarter Ended												% Change								For the Year Ended
		December 31, 2024				September 30, 2024				December 31, 2023				4Q24 to 3Q24				4Q24 to 4Q23				December 31, 2024				December 31, 2023
OIL VOLUME - Barrels per day
United States			147,573				143,299				83,909				3%				76%				128,531				78,889
Egypt			45,017				44,627				45,204				1%				0%				43,817				43,349
North Sea			27,683				21,334				30,748				30%				-10%				26,340				34,728
International			72,700				65,961				75,952				10%				-4%				70,157				78,077
Total			220,273				209,260				159,861				5%				38%				198,688				156,966
NATURAL GAS VOLUME - Mcf per day
United States			511,587				467,615				462,498				9%				11%				483,446				452,281
Egypt			149,816				145,190				150,212				3%				0%				142,363				157,269
North Sea			36,842				18,911				58,054				95%				-37%				39,986				50,284
International			186,658				164,101				208,266				14%				-10%				182,349				207,553
Total			698,245				631,716				670,764				11%				4%				665,795				659,834
NGL VOLUME - Barrels per day
United States			80,390				79,474				67,679				1%				19%				73,877				62,997
North Sea			1,311				543				1,335				141%				-2%				1,201				1,240
Total			81,701				80,017				69,014				2%				18%				75,078				64,237
BOE per day
United States			313,227				300,709				228,671				4%				37%				282,983				217,266
Egypt			69,986				68,825				70,239				2%				0%				67,544				69,561
North Sea			35,134				25,029				41,758				40%				-16%				34,204				44,349
International			105,120				93,854				111,997				12%				-6%				101,748				113,910
Total			418,347				394,563				340,668				6%				23%				384,731				331,176

 

Page 3

APA CORPORATION

PRICE INFORMATION

 

		For the Quarter Ended												For the Year Ended
		December 31,				September 30,				December 31,				December 31,				December 31,
		2024				2024				2023				2024				2023
AVERAGE OIL PRICE PER BARREL
United States		$	70.38			$	76.34			$	79.04			$	75.92			$	77.84
Egypt			74.54				79.88				83.67				80.41				82.47
North Sea			75.42				83.36				80.70				80.74				82.75
International			74.80				80.38				82.98				80.48				82.55
Total			72.42				78.06				81.36				78.08				80.72
AVERAGE NATURAL GAS PRICE PER MCF
United States		$	1.01			$	0.16			$	1.62			$	0.71			$	1.80
Egypt			2.97				2.93				2.89				2.94				2.91
North Sea			14.40				9.76				13.46				10.84				13.02
International			4.03				3.30				4.56				3.82				4.25
Total			2.20				1.43				2.92				1.97				2.91
AVERAGE NGL PRICE PER BARREL
United States		$	24.52			$	20.91			$	19.82			$	22.83			$	20.85
North Sea			50.65				45.93				48.16				47.59				47.77
Total			25.08				21.29				20.70				23.37				21.54

 

Page 4

APA CORPORATION

SUPPLEMENTAL FINANCIAL INFORMATION

(Unaudited)

(In millions)

SUMMARY EXPLORATION EXPENSE INFORMATION

 

		For the Quarter Ended								For the Year Ended
		December 31,								December 31,
		2024				2023				2024				2023
Unproved leasehold impairments		$	24			$	2			$	35			$	22
Dry hole expense			29				21				201				92
Geological and geophysical expense			—				16				21				19
Exploration overhead and other			12				12				56				62
		$	65			$	51			$	313			$	195

SUMMARY CASH FLOW INFORMATION

 

		For the Quarter Ended								For the Year Ended
		December 31,								December 31,
		2024				2023				2024				2023
Net cash provided by operating activities		$	1,036			$	1,030			$	3,620			$	3,129
Additions to upstream oil and gas property			(698	)			(575	)			(2,851	)			(2,313	)
Leasehold and property acquisitions			4				—				(60	)			(44	)
Proceeds from asset divestitures			885				—				1,609				29
Proceeds from sale of Kinetik shares			—				228				428				228
Other, net			(108	)			(9	)			(50	)			(38	)
Net cash provided by (used in) investing activities		$	83			$	(356	)		$	(924	)		$	(2,138	)
Payments on commercial paper and revolving credit facilities, net			(230	)			(396	)			(40	)			(194	)
Proceeds from term loan facility			—				—				1,500				—
Payments on term loan facility			(100	)			—				(600	)			—
Payment on Callon Credit Agreement			—				—				(472	)			—
Payments on fixed-rate debt			—				—				(1,641	)			(65	)
Distributions to noncontrolling interest			(35	)			(84	)			(268	)			(238	)
Treasury stock activity, net			(100	)			(121	)			(246	)			(329	)
Dividends paid to APA common stockholders			(93	)			(76	)			(353	)			(308	)
Other, net			—				(5	)			(38	)			(15	)
Net cash used in financing activities		$	(558	)		$	(682	)		$	(2,158	)		$	(1,149	)

SUMMARY BALANCE SHEET INFORMATION

 

		December 31,				December 31,
		2024				2023
Cash and cash equivalents		$	625			$	87
Other current assets			2,779				2,375
Property and equipment, net			12,646				10,038
Decommissioning security for sold Gulf of America properties			21				21
Other assets			3,319				2,723
Total assets		$	19,390			$	15,244
Current debt		$	53			$	2
Current liabilities			2,902				2,402
Long-term debt			5,991				5,186
Decommissioning contingency for sold Gulf of America properties			929				764
Deferred credits and other noncurrent liabilities			3,153				3,199
APA shareholders’ equity			5,280				2,655
Noncontrolling interest			1,082				1,036
Total Liabilities and equity		$	19,390			$	15,244
Common shares outstanding at end of period			365				304

 

Page 5

APA CORPORATION

NON-GAAP FINANCIAL MEASURES

(In millions, except per share data)

Reconciliation of Costs incurred to Upstream capital investment

Management believes the presentation of upstream capital investments is useful for investors to assess APA’s expenditures related to our upstream capital activity. We define capital investments as costs incurred for oil and gas activities, adjusted to exclude property acquisitions, asset retirement obligation revisions and liabilities incurred, capitalized interest, and certain exploration expenses, while including amounts paid during the period for abandonment and decommissioning expenditures. Upstream capital expenditures attributable to a one-third noncontrolling interest in Egypt are also excluded. Management believes this provides a more accurate reflection of APA’s cash expenditures related to upstream capital activity and is consistent with how we plan our capital budget.

 

		For the Quarter Ended								For the Year Ended
		December 31,								December 31,
		2024				2023				2024				2023
Costs incurred in oil and gas property:
Asset and leasehold acquisitions		$	10			$	10			$	4,564			$	25
Exploration and development			752				969				3,298				2,694
Total Costs incurred in oil and gas property		$	762			$	979			$	7,862			$	2,719
Reconciliation of Costs incurred to Upstream capital investment:
Total Costs incurred in oil and gas property		$	762			$	979			$	7,862			$	2,719
Property acquisitions			(12	)			—				(4,562	)			(1	)
Asset retirement obligations settled vs. incurred - oil and gas property			(81	)			(347	)			(244	)			(327	)
Capitalized interest			(7	)			(6	)			(29	)			(24	)
Exploration seismic and administration costs			(12	)			(28	)			(77	)			(81	)
Upstream capital investment including noncontrolling interest - Egypt		$	650			$	598			$	2,950			$	2,286
Less noncontrolling interest - Egypt			(58	)			(78	)			(253	)			(281	)
Total Upstream capital investment		$	592			$	520			$	2,697			$	2,005

Reconciliation of Net cash provided by operating activities to Cash flows from operations before changes in operating assets and liabilities and Free cash flow

Cash flows from operations before changes in operating assets and liabilities and free cash flow are non-GAAP financial measures. APA uses these measures internally and provides this information because management believes it is useful in evaluating the company’s ability to generate cash to internally fund exploration and development activities, fund dividend programs, and service debt, as well as to compare our results from period to period. We believe these measures are also used by research analysts and investors to value and compare oil and gas exploration and production companies and are frequently included in published research reports when providing investment recommendations. Cash flows from operations before changes in operating assets and liabilities and free cash flow are additional measures of liquidity but are not measures of financial performance under GAAP and should not be considered as an alternative to cash flows from operating, investing, or financing activities. Additionally, this presentation of free cash flow may not be comparable to similar measures presented by other companies in our industry.

 

		For the Quarter Ended								For the Year Ended
		December 31,								December 31,
		2024				2023				2024				2023
Net cash provided by operating activities		$	1,036			$	1,030			$	3,620			$	3,129
Changes in operating assets and liabilities			107				(23	)			535				417
Cash flows from operations before changes in operating assets and liabilities		$	1,143			$	1,007			$	4,155			$	3,546
Adjustments to free cash flow:
Upstream capital investment including noncontrolling interest—Egypt			(650	)			(598	)			(2,950	)			(2,286	)
Decommissioning spend on previously sold Gulf of America properties			(24	)			—				(63	)			—
Non oil and gas capital investment			(14	)			(33	)			(33	)			(57	)
Distributions to Sinopec noncontrolling interest			(35	)			(84	)			(268	)			(238	)
Free cash flow		$	420			$	292			$	841			$	965

Reconciliation of Net cash provided by operating activities to Adjusted EBITDAX

Management believes EBITDAX, or earnings before income tax expense, interest expense, depreciation, amortization and exploration expense is a widely accepted financial indicator, and useful for investors, to assess a company’s ability to incur and service debt, fund capital expenditures, and make distributions to shareholders. We define adjusted EBITDAX, a non-GAAP financial measure, as EBITDAX adjusted for certain items presented in the accompanying reconciliation. Management uses adjusted EBITDAX to evaluate our ability to fund our capital expenditures, debt services and other operational requirements and to compare our results from period to period by eliminating the impact of certain items that management does not consider to be representative of the Company’s on-going operations. Management also believes adjusted EBITDAX facilitates investors and analysts in evaluating and comparing EBITDAX from period to period by eliminating differences caused by the existence and timing of certain operating expenses that would not otherwise be apparent on a GAAP basis. However, our presentation of adjusted EBITDAX may not be comparable to similar measures of other companies in our industry.

 

		For the Quarter Ended												For the Year Ended
		December 31,				September 30,				December 31,				December 31,
		2024				2024				2023				2024				2023
Net cash provided by operating activities		$	1,036			$	1,339			$	1,030			$	3,620			$	3,129
Adjustments:
Exploration expense other than dry hole expense and unproved leasehold impairments			12				20				28				77				81
Current income tax provision			308				260				316				1,153				1,338
Other adjustments to reconcile net income to net cash provided by operating activities			(16	)			45				(71	)			(2	)			(26	)
Changes in operating assets and liabilities			107				(221	)			(23	)			535				417
Financing costs, net			91				100				77				367				321
Transaction, reorganization & separation costs			12				14				4				168				15
Adjusted EBITDAX (Non-GAAP)		$	1,550			$	1,557			$	1,361			$	5,918			$	5,275

 

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APA CORPORATION

NON-GAAP FINANCIAL MEASURES

(In millions)

Reconciliation of debt to net debt

Net debt, or outstanding debt obligations less cash and cash equivalents, is a non-GAAP financial measure. Management uses net debt as a measure of the Company’s outstanding debt obligations that would not be readily satisfied by its cash and cash equivalents on hand.

 

		December 31,				September 30,				June 30,				March 31,
		2024				2024				2024				2024
Current debt		$	53			$	2			$	2			$	2
Long-term debt			5,991				6,370				6,741				5,178
Total debt			6,044				6,372				6,743				5,180
Cash and cash equivalents			625				64				160				102
Net debt		$	5,419			$	6,308			$	6,583			$	5,078

Reconciliation of Income attributable to common stock to Adjusted earnings

Our presentation of adjusted earnings and adjusted earnings per share are non-GAAP measures because they exclude the effect of certain items included in Income Attributable to Common Stock. Management believes that adjusted earnings and adjusted earnings per share provides relevant and useful information, which is widely used by analysts, investors and competitors in our industry as well as by our management in assessing the Company’s operational trends and comparability of results to our peers.

Management uses adjusted earnings and adjusted earnings per share to evaluate our operating and financial performance because it eliminates the impact of certain items that management does not consider to be representative of the Company’s on-going business operations. As a performance measure, adjusted earnings may be useful to investors in facilitating comparisons to others in the Company’s industry because certain items can vary substantially in the oil and gas industry from company to company depending upon accounting methods, book value of assets, capital structure and asset sales and other divestitures, among other factors. Management believes excluding these items facilitates investors and analysts in evaluating and comparing the underlying operating and financial performance of our business from period to period by eliminating differences caused by the existence and timing of certain expense and income items that would not otherwise be apparent on a GAAP basis. However, our presentation of adjusted earnings and adjusted earnings per share may not be comparable to similar measures of other companies in our industry.

 

		For the Quarter Ended																For the Quarter Ended
		December 31, 2024																December 31, 2023
		Before				Tax				After				Diluted				Before				Tax				After				Diluted
		Tax				Impact				Tax				EPS				Tax				Impact				Tax				EPS
Net income including noncontrolling interests (GAAP)		$	500			$	(75	)		$	425			$	1.15			$	540			$	1,324			$	1,864			$	6.08
Income attributable to noncontrolling interests			129				(58	)			71				0.19				163				(72	)			91				0.30
Net income attributable to common stock			371				(17	)			354				0.96				377				1,396				1,773				5.78
Adjustments: *
Asset and unproved leasehold impairments			42				(16	)			26				0.07				17				(4	)			13				0.04
Valuation allowance and EPL revaluation			—				(11	)			(11	)			(0.03	)			—				(1,634	)			(1,634	)			(5.33	)
Other tax adjustments			—				(224	)			(224	)			(0.61	)			—				—				—				—
Unrealized derivative instrument (gain) loss			(10	)			2				(8	)			(0.02	)			10				(2	)			8				0.03
Loss on previously sold Gulf of America properties			190				(42	)			148				0.40				212				(45	)			167				0.54
Kinetik equity investment mark-to-market loss			—				—				—				—				29				(6	)			23				0.08
Transaction, reorganization & separation costs			12				(3	)			9				0.03				4				(2	)			2				0.01
Gain on divestitures, net			(5	)			1				(4	)			(0.01	)			(1	)			1				—				—
Adjusted earnings (Non-GAAP)		$	600			$	(310	)		$	290			$	0.79			$	648			$	(296	)		$	352			$	1.15
		For the Year Ended																For the Year Ended
		December 31, 2024																December 31, 2023
		Before				Tax				After				Diluted				Before				Tax				After				Diluted
		Tax				Impact				Tax				EPS				Tax				Impact				Tax				EPS
Net income including noncontrolling interests (GAAP)		$	1,535			$	(417	)		$	1,118			$	3.16			$	2,883			$	324			$	3,207			$	10.39
Income attributable to noncontrolling interests			570				(256	)			314				0.89				628				(276	)			352				1.14
Net income attributable to common stock			965				(161	)			804				2.27				2,255				600				2,855				9.25
Adjustments: *
Asset and unproved leasehold impairments			1,164				(558	)			606				1.71				83				(50	)			33				0.11
Valuation allowance and EPL revaluation			—				5				5				0.02				—				(1,627	)			(1,627	)			(5.27	)
Other tax adjustments			—				(224	)			(224	)			(0.63	)			—				—				—				—
Gain on extinguishment of debt			—				—				—				—				(9	)			2				(7	)			(0.02	)
Unrealized derivative instrument (gain) loss			8				(2	)			6				0.02				(51	)			11				(40	)			(0.13	)
Loss on previously sold Gulf of America properties			273				(60	)			213				0.60				212				(45	)			167				0.54
Kinetik equity investment mark-to-market loss			9				—				9				0.03				12				(2	)			10				0.03
Drilling contract termination charges			—				—				—				—				13				(10	)			3				0.01
Transaction, reorganization & separation costs			168				(30	)			138				0.39				15				(5	)			10				0.03
Gain on divestitures, net			(289	)			63				(226	)			(0.64	)			(8	)			2				(6	)			(0.02	)
Adjusted Earnings (Non-GAAP)		$	2,298			$	(967	)		$	1,331			$	3.77			$	2,522			$	(1,124	)		$	1,398			$	4.53

 

*	The income tax effect of the reconciling items are calculated based on the statutory rate of the jurisdiction in which the discrete item resides.

 

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