HOUSTON -- Marathon Oil Corp. has reported second-quarter 2005 net income of $673 million, or $1.92 per diluted share. Net income in second-quarter 2004 was $352 million, or $1.02 per diluted share. For second-quarter 2005, net income adjusted for special items was $755 million, or $2.16 per diluted share. For second-quarter 2004, net income adjusted for special items was $407 million, or $1.18 per diluted share.
A key contributor to Marathon's strong second quarter results was the consistent and successful execution of the company's strategy and business [image-nocss] plans. While we continued to realize the benefits of high commodity prices and margins throughout the quarter, our results were also positively impacted by the strong operating performance of each of our businesses, said Clarence P. Cazalot, Jr., Marathon president and CEO.
In particular, the solid results of our exploration and production operations demonstrate the improvements being made, which are positioning Marathon for long term value growth, he added. These upstream results were complemented by our downstream operations, which achieved outstanding results through strong operational performance and by optimizing our refining and marketing network's ability to realize the benefits of favorable crack spreads, sweet/sour differentials and strong wholesale and retail margins.
Marathon achieved a strategic milestone during second-quarter 2005 with the completion of its acquisition of Ashland Inc.'s 38% interest in Marathon Ashland Petroleum LLC (MAP), which will change its name to Marathon Petroleum Co. LLC (MPC) effective Sept. 1, 2005, as well as two complementary businesses.
The completion of this transaction reinforces Marathon's strategic intent to remain a fully integrated company, said Cazalot. This segment of our business has distinguished itself as a leading refining, marketing and transportation organization and we look forward to the many opportunities and contributions it will provide in our drive for sustainable value growth.
Total segment income was $1.61 billion in second-quarter 2005, compared with $1.007 billion in second-quarter 2004.
Upstream segment income totaled $776 million in second-quarter 2005, compared to $438 million in second-quarter 2004. U.S. upstream income was $394 million in second-quarter 2005, compared to $285 million in second-quarter 2004.
Downstream segment income was $823 million in second-quarter 2005 compared to segment income of $577 million in second-quarter 2004. The improvement was primarily due to a higher refining and wholesale marketing margin.
MAP benefited from wider sweet/sour crude differentials in general and was able to run more sour crudes during the period, taking advantage of the substantial discounts on these feedstocks. MAP delivered strong crude runs during second-quarter 2005 that averaged 1.012 million barrels per day, with total throughput averaging a record 1.187 million bpd. This strong operating performance positioned the company to help meet demand for transportation fuels in its markets, while capturing the benefits of strong refining margins.
During the quarter, Speedway SuperAmerica LLC (SSA) continued to achieve strong same-store merchandise sales which increased approximately 10% compared to second-quarter 2004.Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.