IR Package - Table of Contents
First Quarter 2024
Table of Contents:
Statements of Income 2 Guy Baber 713/296-1892
Balance Sheets 3 gbaber@marathonoil.com
Statements of Cash Flows 4
Segment Income Summary 5 John Reid 713/296-4380
United States Segment Supplemental Financial Data 6 jreid@marathonoil.com
International Segment Supplemental Financial Data 7
Non-GAAP Reconciliations 8 - 12
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May 1, 2024
Statements of Income
Consolidated Statements of Income
Marathon Oil Corporation
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Year 1st Qtr
(In millions, except per share data) 2023 2023 2023 2023 2023 2024
REVENUES AND OTHER INCOME:
Revenues from contracts with customers $ 1,567 $ 1,484 $ 1,771 $ 1,585 $ 6,407 $ 1,538
Net gain (loss) on commodity derivatives 15 3 1 23 42 (24)
Income from equity method investments 80 22 38 45 185 39
Net gain on disposal of assets 5 - 0 1 11 17 - 0
Other income (expense) 13 4 2 27 46 (2)
Total revenues and other income 1,680 1,513 1,813 1,691 6,697 1,551
COSTS AND EXPENSES:
Production 201 214 192 221 828 221
Shipping, handling and other operating, including related party (a) 162 161 164 202 689 169
Exploration 15 11 20 13 59 7
Depreciation, depletion and amortization 520 559 583 549 2,211 524
Impairments - 0 - 0 - 0 2 2 - 0
Taxes other than income 95 43 113 112 363 96
General and administrative 82 71 72 72 297 86
Total costs and expenses 1,075 1,059 1,144 1,171 4,449 1,103
Income from operations 605 454 669 520 2,248 448
Net interest and other (82) (92) (94) (84) (352) (69)
Other net periodic benefit credits 3 3 5 4 15 3
Income before income taxes 526 365 580 440 1,911 382
Estimated income tax provision
Current 24 8 18 8 58 42
Deferred 85 70 109 35 299 43
Total provision for income taxes 109 78 127 43 357 85
NET INCOME $ 417 $ 287 $ 453 $ 397 $ 1,554 $ 297
Effective income tax rate 21 % 21 % 22 % 10 % 19 % 22 %
Per common share data:
Basic:
Weighted average shares (millions) 628 614 603 583 607 576
NET INCOME $ 0.66 $ 0.47 $ 0.75 $ 0.68 $ 2.56 $ 0.52
Diluted:
Weighted average shares (millions) 629 615 604 584 608 576
NET INCOME $ 0.66 $ 0.47 $ 0.75 $ 0.68 $ 2.56 $ 0.52
Dividends paid per common share $ 0.10 $ 0.10 $ 0.10 $ 0.11 $ 0.41 $ 0.11
(a) The related party expense represents compensation to EG LNG for liquefaction, storage and product handling services, pursuant to the agreement that became effective on January 1, 2024.
Balance Sheets
Consolidated Balance Sheets
Marathon Oil Corporation
Mar. 31 June 30 Sept. 30 Dec. 31 Mar. 31
(In millions) 2023 2023 2023 2023 2024
ASSETS
Current assets:
Cash and cash equivalents $ 178 $ 215 $ 174 $ 155 $ 49
Receivables, net 1,215 1,294 1,434 1,152 1,276
Inventories 136 136 174 186 179
Other current assets 77 58 66 76 53
Total current assets 1,606 1,703 1,848 1,569 1,557
Equity method investments 657 430 421 433 472
Property, plant and equipment, net 17,463 17,524 17,411 17,213 17,303
Other noncurrent assets 286 262 239 360 336
Total assets $ 20,012 $ 19,919 $ 19,919 $ 19,575 $ 19,668
LIABILITIES
Current liabilities:
Accounts payable $ 1,480 $ 1,537 $ 1,582 $ 1,364 $ 1,514
Commercial paper - 0 - 0 450 450 450
Payroll and benefits payable 41 50 67 70 40
Accrued taxes 176 102 128 126 135
Other current liabilities 318 305 279 312 310
Long-term debt due within one year 131 131 400 1,600 400
Total current liabilities 2,146 2,125 2,906 3,922 2,849
Long-term debt 5,723 5,724 4,876 3,378 4,578
Deferred tax liabilities 209 278 386 419 462
Defined benefit postretirement plan obligations 99 105 94 93 93
Asset retirement obligations 296 299 308 326 329
Deferred credits and other liabilities 151 144 123 232 213
Total liabilities 8,624 8,675 8,693 8,370 8,524
TOTAL STOCKHOLDERS' EQUITY 11,388 11,244 11,226 11,205 11,144
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 20,012 $ 19,919 $ 19,919 $ 19,575 $ 19,668
Common stock issued 937 937 937 937 937
Common stock held in treasury 315 331 347 360 369
Net shares outstanding at balance sheet date 622 606 590 577 568
Statements of Cash Flows
Consolidated Statements of Cash Flows (YTD)
Marathon Oil Corporation
Mar. 31 June 30 Sept. 30 Dec. 31 Mar. 31
(In millions) 2023 2023 2023 2023 2024
OPERATING ACTIVITIES:
Net income $ 417 $ 704 $ 1,157 $ 1,554 $ 297
Adjustments to reconcile to net cash provided by operating activities:
Depreciation, depletion and amortization 520 1,079 1,662 2,211 524
Impairments - 0 - 0 - 0 2 - 0
Exploratory dry well costs and unproved property impairments 14 24 41 53 6
Net gain on disposal of assets (5) (5) (6) (17) - 0
Deferred income taxes 85 155 264 299 43
Unrealized (gain) loss on derivative instruments (2) 2 8 (13) 24
Pension and other post retirement benefits, net (7) (11) (27) (33) (3)
Stock-based compensation 10 21 32 43 11
Equity method investments, net (80) 113 99 83 (39)
Changes in:
Current receivables (86) (158) (298) (21) (120)
Inventories (12) (11) (51) (64) 6
Current accounts payable and accrued liabilities 30 37 166 (10) 12
Other current assets and liabilities (9) 10 (17) (5) (2)
All other operating, net (10) (19) (23) 5 (2)
Net cash provided by operating activities 865 1,941 3,007 4,087 757
INVESTING ACTIVITIES:
Capital expenditures (601) (1,224) (1,673) (2,033) (603)
Change in capital accrual 69 58 14 (25) 117
Acquisitions, net of cash acquired 11 9 (15) (12) (4)
Disposal of assets, net of cash transferred to the buyer (1) (1) (7) 3 - 0
Equity method investments - return of capital - 0 34 57 61 - 0
All other investing, net - 0 (1) - 0 - 0 1
Net cash used in investing activities (522) (1,125) (1,624) (2,006) (489)
FINANCING ACTIVITIES:
Borrowings - 0 200 200 200 1,200
Debt repayments (70) (270) (401) (701) (1,200)
Proceeds from revolving credit facility 175 980 1,018 1,248 50
Repayments of revolving credit facility (175) (980) (1,468) (1,698) (43)
Proceeds from commercial paper borrowings, net - 0 - 0 450 450 - 0
Shares repurchased under buyback programs (334) (706) (1,121) (1,473) (285)
Dividends paid (63) (125) (186) (251) (64)
Withholding tax on stock-based incentive awards (30) (30) (31) (31) (18)
All other financing, net (2) (4) (4) (4) (14)
Net cash used in financing activities (499) (935) (1,543) (2,260) (374)
Net decrease in cash and cash equivalents (156) (119) (160) (179) (106)
Cash and cash equivalents at beginning of period 334 334 334 334 155
Cash and cash equivalents at end of period $ 178 $ 215 $ 174 $ 155 $ 49
Segment Income Statement
Segment Income Summary
Marathon Oil Corporation
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Year 1st Qtr
(In millions) 2023 2023 2023 2023 2023 2024
Segment income
United States $ 425 $ 365 $ 505 $ 468 $ 1,763 $ 334
International 89 30 62 51 232 82
Segment income 514 395 567 519 1,995 416
Not allocated to segments - Corporate items:
Net interest and other (82) (92) (94) (84) (352) (69)
Other net periodic benefit credits 4 3 5 4 16 3
General and administrative (43) (37) (36) (35) (151) (45)
Other income and costs (1) (1) (1) (3) (6) (14)
Income tax benefit 28 27 25 5 85 26
Not allocated to segments - Adjustments for special items:
Net gain on disposal of assets 5 - 0 1 11 17 - 0
Proved property impairments - 0 - 0 - 0 (2) (2) - 0
Exploratory dry well costs, unproved property impairments and other (10) (5) (11) (4) (30) - 0
Pension settlement (1) - 0 - 0 - 0 (1) - 0
Unrealized gain (loss) on derivative instruments 2 (4) (6) 21 13 (24)
Acquisition transaction costs (1) - 0 (1) - 0 (2) - 0
Other 1 (1) - 0 (37) (37) (2)
Provision for income taxes related to special items 1 2 4 2 9 6
Total special items $ (3) $ (8) $ (13) $ (9) $ (33) - 0 $ (20)
Not allocated to segments - Total $ (97) $ (108) $ (114) $ (122) $ (441) $ (119)
Net income $ 417 $ 287 $ 453 $ 397 $ 1,554 $ 297
United States Supplemental Fina
United States Segment Supplemental Financial Data
Marathon Oil Corporation
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Year 1st Qtr
(In millions, except per BOE statistics) 2023 2023 2023 2023 2023 2024
Revenues from contracts with customers (a) $ 1,503 $ 1,440 $ 1,700 $ 1,556 $ 6,199 $ 1,422
Net realized gain on commodity derivatives 13 7 7 2 29 - 0
Other income (expense) 11 1 - 0 9 21 (4)
Less Costs and Expenses:
Production 178 191 173 211 753 201
Shipping, handling and other operating (b) 159 161 162 165 647 149
Exploration 5 6 8 8 27 7
DD&A 505 547 570 534 2,156 500
Taxes other than income 97 43 112 112 364 96
General and administrative 35 31 32 33 131 38
Income before taxes 548 469 650 504 2,171 427
Income tax provision 123 104 145 36 408 93
Segment income $ 425 $ 365 $ 505 $ 468 $ 1,763 $ 334
Effective tax rate 22 % 22 % 22 % 7 % 19 % 22 %
Net sales volumes (mboed) 341 356 369 352 355 326
Costs and Expenses per BOE (c)
Production $ 5.82 $ 5.88 $ 5.07 $ 6.51 $ 5.81 $ 6.77
Shipping, handling and other operating (d) 4.92 4.93 4.75 4.98 4.89 4.91
Exploration 0.17 0.15 0.23 0.28 0.21 0.24
DD&A 16.46 16.88 16.74 16.52 16.66 16.83
Taxes other than income 3.15 1.31 3.33 3.43 2.81 3.24
General and administrative 1.13 0.97 0.94 1.01 1.01 1.26
(a) Includes marketing revenue.
(b) Includes marketing expense.
(c) Costs and expenses per BOE are based upon volumes sold.
(d) Excludes marketing expense.
International Supplemental Fina
International Segment Supplemental Financial Data
Marathon Oil Corporation
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Year 1st Qtr
(In millions, except per BOE statistics) 2023 2023 2023 2023 2023 2024
Revenues from contracts with customers $ 64 $ 44 $ 71 $ 29 $ 208 $ 116
Income from equity method investments 80 22 38 45 185 39
Other income 1 3 1 16 21 1
Less Costs and Expenses:
Production 23 23 19 10 75 20
Shipping, handling and other operating, including related party (a) 3 - 0 2 - 0 5 17
Exploration - 0 - 0 1 1 2 - 0
DD&A 12 10 12 10 44 10
General and administrative 3 3 3 4 13 3
Income before taxes 104 33 73 65 275 106
Income tax provision 15 3 11 14 43 24
Segment income $ 89 $ 30 $ 62 $ 51 $ 232 $ 82
Effective tax rate 14 % 9 % 15 % 22 % 16 % 23 %
Net sales volumes (mboed) 56 44 53 48 50 43
Costs and Expenses per BOE (b)
Production $ 4.54 $ 5.72 $ 3.99 $ 2.30 $ 4.11 $ 5.13
Shipping, handling and other operating, including related party (a) 0.64 0.16 0.16 0.13 0.29 4.29
Exploration - 0 0.04 0.20 0.14 0.09 0.07
DD&A 2.41 2.42 2.39 2.49 2.43 2.79
General and administrative 0.63 0.69 0.66 0.82 0.70 0.85
Equatorial Guinea
Dividends $ - $ 215 $ 24 $ 29 $ 268 $ -
Return of capital - 0 34 23 4 61 - 0
Total cash distributions $ - $ 249 $ 47 $ 33 $ 329 $ -
Income from equity method investments $ 80 $ 22 $ 38 $ 45 $ 185 $ 39
(a) The related party expense represents compensation to EG LNG for liquefaction, storage and product handling services, pursuant to the agreement that became effective on January 1, 2024.
(b) Costs and expenses per BOE are based upon volumes sold.
Non-GAAP Reconciliations 1
Non-GAAP Reconciliations
Marathon Oil Corporation
Marathon Oil Corporation ("Marathon") supplements its use of GAAP financial measures with non-GAAP financial measures as described on the following pages:
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Year 1st Qtr
(In millions) 2023 2023 2023 2023 2023 2024
Net income $ 417 $ 287 $ 453 $ 397 $ 1,554 $ 297
Adjustments for special items (pre-tax):
Net gain on disposal of assets (5) - 0 (1) (11) (17) - 0
Proved property impairments - 0 - 0 - 0 2 2 - 0
Exploratory dry well costs, unproved property impairments and other 10 5 11 4 30 - 0
Pension settlement 1 - 0 - 0 - 0 1 - 0
Unrealized (gain) loss on derivative instruments (2) 4 6 (21) (13) 24
Acquisition transaction costs 1 - 0 1 - 0 2 - 0
Other (1) 1 - 0 37 37 2
Benefit for income taxes related to special items (1) (2) (4) (2) (9) (6)
Adjustments for special items 3 8 13 9 33 20
Adjusted net income (a) $ 420 $ 295 $ 466 $ 406 $ 1,587 $ 317
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Year 1st Qtr
(In millions, except per share data) 2023 2023 2023 2023 2023 2024
Per common share data:
Diluted:
Weighted average shares (millions) 629 615 604 584 608 576
Adjusted net income (a) $ 420 $ 295 $ 466 $ 406 $ 1,587 $ 317
Adjusted net income per share (a) $ 0.67 $ 0.48 $ 0.77 $ 0.69 $ 2.61 $ 0.55
(a) Non-GAAP financial measure.
Our presentation of adjusted net income (loss) and adjusted net income (loss) per share is a non-GAAP measure. Adjusted net income (loss) is defined as net income (loss) adjusted for gains or losses on dispositions, impairments of proved and certain unproved properties, unrealized gain or loss on commodity derivative instruments, effects of pension settlements and curtailments, acquisition transaction costs and other items that could be considered "non-operating" or "non-core" in nature. Management believes this is useful to investors as another tool to meaningfully represent our operating performance and to compare Marathon to certain competitors. Adjusted net income (loss) and adjusted net income (loss) per share should not be considered in isolation or as an alternative to, or more meaningful than, net income (loss) or net income (loss) per share as determined in accordance with U.S. GAAP.
Non-GAAP Reconciliations 2
Non-GAAP Reconciliations
Marathon Oil Corporation
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Year 1st Qtr
(Per share) 2023 2023 2023 2023 2023 2024
Adjusted Net Income Per Diluted Share (a)
Net income $ 0.66 $ 0.47 $ 0.75 $ 0.68 $ 2.56 $ 0.52
Adjustments for special items (pre-tax):
Net gain on disposal of assets (0.01) - 0 - 0 (0.02) (0.03) - 0
Exploratory dry well costs, unproved property impairments and other 0.02 0.01 0.01 0.01 0.05 - 0
Unrealized (gain) loss on derivative instruments - 0 - 0 0.01 (0.03) (0.02) 0.04
Other - 0 - 0 - 0 0.05 0.05 - 0
Benefit for income taxes related to special items - 0 - 0 - 0 - 0 - 0 (0.01)
Adjustments for special items 0.01 0.01 0.02 0.01 0.05 0.03
Adjusted net income (a) $ 0.67 $ 0.48 $ 0.77 $ 0.69 $ 2.61 $ 0.55
(a) Non-GAAP financial measure.
Our presentation of adjusted net income (loss) and adjusted net income (loss) per share is a non-GAAP measure. Adjusted net income (loss) is defined as net income (loss) adjusted for gains or losses on dispositions, impairments of proved and certain unproved properties, unrealized gain or loss on commodity derivative instruments, effects of pension settlements and curtailments, acquisition transaction costs and other items that could be considered "non-operating" or "non-core" in nature. Management believes this is useful to investors as another tool to meaningfully represent our operating performance and to compare Marathon to certain competitors. Adjusted net income (loss) and adjusted net income (loss) per share should not be considered in isolation or as an alternative to, or more meaningful than, net income (loss) or net income (loss) per share as determined in accordance with U.S. GAAP.
Non-GAAP Reconciliations 3
Non-GAAP Reconciliations
Marathon Oil Corporation
(In millions) 1st Qtr 2023 2nd Qtr 2023 3rd Qtr 2023 4th Qtr 2023 Year 2023 1st Qtr 2024
Adjusted Free Cash Flow (a)
Net cash provided by operating activities $ 865 $ 1,076 $ 1,066 $ 1,080 $ 4,087 $ 757
Adjustments:
Changes in working capital 77 45 78 (100) 100 104
Capital expenditures (601) (623) (449) (360) (2,033) (603)
EG return of capital and other (32) 33 23 4 28 (19)
Adjusted Free Cash Flow (a) $ 309 $ 531 $ 718 $ 624 $ 2,182 $ 239
(a) Non-GAAP financial measure.
Our presentation of adjusted free cash flow is a non-GAAP measure. Adjusted free cash flow before dividend ("adjusted free cash flow") is defined as net cash provided by operating activities before changes in working capital (adjusted CFO), net of capital expenditures and EG return of capital and other. Management believes this is useful to investors as a measure of Marathon's ability to fund its capital expenditure programs, service debt, and other distributions to stockholders. Adjusted free cash flow should not be considered in isolation or as an alternative to, or more meaningful than, net cash provided by operating activities as determined in accordance with U.S. GAAP.
Non-GAAP Reconciliations 4
Non-GAAP Reconciliations
Marathon Oil Corporation
(In millions) Mar. 31 June 30 Sept. 30 Dec. 31 Mar. 31
Adjusted CFO (QTD) 2023 2023 2023 2023 2024
Net cash provided by operating activities $ 865 $ 1,076 $ 1,066 $ 1,080 $ 757
Current receivables (86) (72) (140) 277 (120)
Inventories (12) 1 (40) (13) 6
Current accounts payable and accrued expenses 30 7 129 (176) 12
Other current assets and liabilities (9) 19 (27) 12 (2)
Changes in working capital (77) (45) (78) 100 (104)
Adjusted CFO (a) $ 942 $ 1,121 $ 1,144 $ 980 $ 861
(In millions) 1st Qtr 2023 2nd Qtr 2023 3rd Qtr 2023 4th Qtr 2023 Year 2023 1st Qtr 2024
Reinvestment rate (a)
Adjusted CFO (a) $ 942 $ 1,121 $ 1,144 $ 980 $ 4,187 $ 861
EG return of capital and other (32) 33 23 4 28 (19)
Sources of Cash 910 1,154 1,167 984 4,215 842
Capital expenditures $ 601 $ 623 $ 449 $ 360 $ 2,033 $ 603
Reinvestment rate (a) 66 % 54 % 38 % 37 % 48 % 72 %
(a) Non-GAAP financial measure.
Our presentation of Adjusted CFO is a non-GAAP measure. Adjusted CFO is defined as net cash provided by operating activities adjusted for changes in working capital. Management believes this is useful to investors as an indicator of Marathon's ability to generate cash quarterly or year-to-date by eliminating differences caused by the timing of certain working capital items. Adjusted CFO should not be considered in isolation or as an alternative to, or more meaningful than, net cash provided by operating activities as determined in accordance with U.S. GAAP.
Our presentation of reinvestment rate is a non-GAAP measure. The reinvestment rate is defined as capital expenditures divided by adjusted CFO and EG return of capital and other. Management believes the reinvestment rate is useful to investors to demonstrate the Company's commitment to generating cash for use towards investor-friendly purposes (which includes balance sheet enhancement, base dividend and other return of capital).
Non-GAAP Reconciliations 5
Non-GAAP Reconciliations
Marathon Oil Corporation
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Year 1st Qtr
(In millions) 2023 2023 2023 2023 2023 2024
Net income $ 417 $ 287 $ 453 $ 397 $ 1,554 $ 297
Adjustments to net income:
DD&A 520 559 583 549 2,211 524
Tax 109 78 127 43 357 85
Exploration 15 11 20 13 59 7
Net interest and other 82 92 94 84 352 69
EBITDAX (a) 1,143 1,027 1,277 1,086 4,533 982
EBITDAX special items adjustments:
Net gain on disposal of assets (5) - 0 (1) (11) (17) - 0
Proved property impairments - 0 - 0 - 0 2 2 - 0
Pension settlement 1 - 0 - 0 - 0 1 - 0
Unrealized (gain) loss on derivative instruments (2) 4 6 (21) (13) 24
Acquisition transaction costs 1 - 0 1 - 0 2 - 0
Other (1) 1 - 0 37 37 2
Adjustments for special items (6) 5 6 7 12 26
Adjusted EBITDAX (a) $ 1,137 $ 1,032 $ 1,283 $ 1,093 $ 4,545 $ 1,008
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Year 1st Qtr
(In millions) 2023 2023 2023 2023 2023 2024
Equatorial Guinea EBITDAX (a)
International segment income $ 89 $ 30 $ 62 $ 51 $ 232 $ 82
Adjustments:
DD&A 22 15 22 19 78 21
Tax 26 8 20 21 75 30
Exploration - 0 - 0 - 0 1 1 - 0
Net interest and other - 0 - 0 (2) 3 1 - 0
E.G. EBITDAX (a) $ 137 $ 53 $ 102 $ 95 $ 387 $ 133
(a) Non-GAAP financial measure.
Our presentation of Adjusted EBITDAX is a non-GAAP measure. Adjusted EBITDAX is defined as net income (loss) excluding net interest and other, taxes, depreciation, depletion and amortization ("DD&A"), and exploration, further adjusted for gains or losses on dispositions, impairments of proved properties, unrealized gain or loss on commodity derivative instruments, effects of pension settlements and curtailments, acquisition transaction costs and other items that could be considered "non-operating" or "non-core" in nature. Management believes this provides useful information to investors in evaluating our operating and financial performance because it eliminates the impact of certain items affecting comparability from period to period. Adjusted EBITDAX should not be considered in isolation or as an alternative to, or more meaningful than, net income (loss) as determined in accordance with U.S. GAAP.
Our presentation of E.G. EBITDAX is a non-GAAP measure. E.G. EBITDAX is defined as International segment income (loss) excluding net interest and other, taxes, depreciation, depletion and amortization ("DD&A"), and exploration. Management believes this is useful to investors as a measure of E.G.'s ability to contribute to Marathon's funding for its capital expenditure programs as well as for dividend payments, servicing debt, and other distributions to stockholders. E.G. EBITDAX should not be considered in isolation or as an alternative to, or more meaningful than, International segment income (loss) as determined in accordance with U.S. GAAP.

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Marathon Oil Corporation published this content on 01 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 01 May 2024 21:14:01 UTC.