The following discussion should be read together with the Consolidated Condensed
Financial Statements and the notes to the Consolidated Condensed Financial
Statements, which are included in this report in Part I, Item 1; the information
set forth in Risk Factors under Part II, Item 1A; the Consolidated Financial
Statements and the notes to the Consolidated Financial Statements, which are
included in Part II, Item 8 of Occidental's Annual Report on Form 10-K for the
year ended
PAGE Cautionary Statement Regarding Forward-Looking Statements 24 Current Business Outlook 25 Consolidated Results of Operations 26 Segment Results of Operations and Items Affecting Comparability 29 Income Taxes 32 Liquidity and Capital Resources 33 Environmental Liabilities and Expenditures 34 Lawsuits, Claims, Commitments and Contingencies 34 23
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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
Portions of this report contain forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. All statements other than
statements of historical fact are "forward-looking statements" for purposes of
federal and state securities laws, and they include, but are not limited to: any
projections of earnings, revenue or other financial items or future financial
position or sources of financing; any statements of the plans, strategies and
objectives of management for future operations, business strategy or financial
position; any statements regarding future economic conditions or performance;
any statements of belief; and any statements of assumptions underlying any of
the foregoing. Words such as "estimate," "project," "predict," "will," "would,"
"should," "could," "may," "might," "anticipate," "plan," "intend," "believe,"
"expect," "aim," "goal," "target," "objective," "commit," "advance," "likely" or
similar expressions that convey the prospective nature of events or outcomes are
generally indicative of forward-looking statements. You should not place undue
reliance on these forward-looking statements, which speak only as of the date of
this report. Unless legally required, Occidental does not undertake any
obligation to update, modify or withdraw any forward-looking statements as a
result of new information, future events or otherwise.
Although Occidental believes that the expectations reflected in any of its
forward-looking statements are reasonable, actual results may differ from
anticipated results, sometimes materially. In addition, historical, current and
forward-looking sustainability-related statements may be based on standards for
measuring progress that are still developing, internal controls and processes
that continue to evolve and assumptions that are subject to change in the
future. Factors that could cause results to differ from those projected or
assumed in any forward-looking statement include, but are not limited to:
general economic conditions, including slowdowns, domestically or
internationally; Occidental's indebtedness and other payment obligations,
including the need to generate sufficient cash flows to fund operations;
Occidental's ability to successfully monetize select assets and repay or
refinance debt and the impact of changes in Occidental's credit ratings; the
scope and duration of the COVID-19 pandemic and ongoing actions taken by
governmental authorities and other third parties in response to the pandemic;
assumptions about energy markets; global and local commodity and
commodity-futures pricing fluctuations and volatility; supply and demand
considerations for, and the prices of, Occidental's products and services;
actions by
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CURRENT BUSINESS OUTLOOK
Occidental's operations, financial condition, cash flows and levels of
expenditures are highly dependent on oil prices and, to a lesser extent, NGL and
natural gas prices, the Midland-to-
2022 PRIORITIES Occidental's capital and operational priorities for 2022 are intended to maximize cash flow by sustaining 2021 production levels and maintaining capital discipline. Occidental intends to utilize operating cash flows to:
?continue to reduce financial leverage; ?maintain a robust liquidity position; and ?continue its shareholder return framework in the form of a sustainable common share dividend and active share buyback plan.
During the first half of 2022, Occidental generated cash flow from continuing
operations of
LIABILITY MANAGEMENT In the second quarter of 2022, Occidental repaid debt with maturities ranging from 2024 through 2049 and a face value of$4.8 billion . In the first quarter of 2022, Occidental repaid debt with maturities ranging from 2022 through 2049 and a face value of$3.3 billion . For the combined first and second quarter repayments, Occidental used$7.1 billion of cash, which reduced outstanding debt with a total face value of$8.1 billion and a net book value of$7.4 billion , and resulted in a gain of$161 million . As ofJune 30, 2022 , Occidental has remaining near-term debt maturities of approximately$362 million in 2023 and$1.4 billion in 2024.
DEBT RATINGS
As of
SHAREHOLDER RETURNS
During the six months ended
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CONSOLIDATED RESULTS OF OPERATIONS
Occidental's operations and cash flows can vary significantly based on changes
in oil, NGL and natural gas prices and the prices it receives for its chemical
products. Such changes in prices could result in adjustments in capital
investment levels and how such capital is allocated, which could impact
production volumes. Significant changes have occurred in the macro-economic
environment over the previous year, which have led to an increase in commodity
prices, chemical product pricing, and correspondingly Occidental's results of
operations and cash flows. Occidental's results of operations and cash flows are
driven by these macro-economic effects rather than seasonality. In accordance
with the
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