Murphy Sees Upstream, Downstream Improvement
U.S. refining, marketing strong; merchandise sales rise, but fuel sales volumes drop
EL DORADO, Ark. -- Murphy Oil Corp. has announced net income in second-quarter 2011 of $311.6 million ($1.60 per diluted share) compared to net income of $272.3 million ($1.41 per diluted share) in second-quarter 2010. Income improved in 2011 in both the upstream and downstream businesses. Upstream earnings improved primarily due to higher crude oil sales prices, while downstream earnings improved due to stronger U.S. refining and retail marketing margins.
For the first six months of 2011, net income totaled $580.5 million ($2.98 per diluted share) compared to net income [image-nocss] of $421.2 million ($2.18 per diluted share) for the same period in 2010.
The El Dorado, Ark.-based company's income from exploration and production operations was $243.3 million in second-quarter 2011 compared to $219.1 million in the same quarter of 2010. Income in the 2011 quarter exceeded 2010 primarily due to higher crude oil sales prices in the current period.
The company's refining and marketing operations generated income of $91.7 million in second-quarter 2011 compared to income of $83.8 million in the same quarter of 2010. The R&M earnings improvement in the 2011 second quarter occurred in the United States, where quarterly earnings were $107.5 million in 2011 compared to $79.4 million in 2010.
U.S. marketing operations generated a profit of $80.2 million in the 2011 quarter compared to $69.6 million in the 2010 quarter. The 2011 quarter had average retail marketing margins of $0.199 per gallon, up from $0.162 per gallon in the prior year. Fuel sales volume per store was about 10% below 2010 levels, while merchandise sales per store were up 2% in the 2011 quarter compared to the prior year quarter.
The company's E&P business earned $503.7 million in the first six months of 2011 compared to earnings of $466.1 million in the same period of 2010.
The company's refining and marketing earnings were $122.4 million in the first six months of 2011, compared to earnings of $54.1 million in the same 2010 period.
U.S. marketing operations had income of $90.9 million in the first six months of 2011, above the $78.5 million of income in the same period in 2010. U.S. retail marketing margins averaged $0.146 per gallon in 2011 six-month period compared to $0.123 per gallon in 2010. Fuel sales per store month in 2011 were about 9% lower than in 2010. Merchandise sales per store increased 4% in 2011 compared to 2010, with the current period including more than a 5% higher margin on sales.