July 26, 2005 00:00 ET

Strong Cash Position Supports Larger Capital Budget and More Cash To Shareholders


  • 33% increase to quarterly dividend and renewal of share repurchase program
  • Capital program increased to $3.6 billion to fund additional growth opportunities

CALGARY--(CCNMatthews - July 26) - Petro-Canada announced today second quarter earnings from operations adjusted for unusual items of $525 million ($2.02/share), up 8% from $485 million ($1.82/share) in the same quarter of 2004. Second quarter 2005 cash flow was $934 million ($3.60/share), compared with $856 million ($3.22/share) in the same quarter of last year. Cash flow is before changes in non-cash working capital.

Net earnings for the second quarter in 2005 were $345 million ($1.33/share), compared with $393 million ($1.48/share) in the same period of 2004. Net earnings include unrealized gains or losses on derivative contracts, together with gains or losses on foreign currency translation and disposal of assets. In the second quarter of 2005, an unrealized mark-to-market loss on derivative contracts associated with the Buzzard acquisition lowered net earnings by $171 million after-tax.

"Solid operating results and a strong business environment generated additional cash flow. We used our financial position to increase the capital program and return more cash to shareholders," said Ron Brenneman, president and chief executive officer.

The Company announced a 33% increase to the quarterly dividend and a stock dividend. The stock dividend doubles the number of shares outstanding and effectively achieves a two-for-one stock split. In June, Petro-Canada renewed its normal course issuer bid for the repurchase of its common shares.

Production of crude oil, natural gas liquids and natural gas averaged 420,100 barrels of oil equivalent/day (boe/d) during the quarter. Production for the full year is expected to be 415,000 - 430,000 boe/d, in line with previous guidance.

"We came one step closer to adding near-term production growth with the successful startup of Pict in the North Sea," said Brenneman. "With White Rose expected on-stream around year end, and the Syncrude expansion and Buzzard project on schedule for next year, we are building our production profile."

Petro-Canada is one of Canada's largest oil and gas companies, operating in both the upstream and downstream sectors of the industry in Canada and internationally. Its common shares trade on the Toronto Stock Exchange under the symbol PCA and on the New York Stock Exchange under the symbol PCZ.

The full text of Petro-Canada's second quarter release, including the Management's Discussion and Analysis, can be accessed through Quarterly Reports, or through SEDAR .

Petro-Canada will hold a conference call to discuss these results with investors on Wednesday, July 27, 2005 at 9 a.m. EDT. To participate, please call 1-800-387-6216 or 416-405-9328 at 8:55 a.m EDT. Media are invited to listen to the call by dialing 1-877-211-7911 and are invited to ask questions at the end of the call. Those who are unable to listen to the call live may listen to a recording of it approximately one hour after its completion by calling 1-800-408-3053 or 416-695-5800 (passcode number 3155794). See Quarterly Reports for a live audio broadcast of the conference call available on July 27 at 9 a.m. EDT. Approximately one hour after the call, a recording of the call will be available on the Web site.

Contact Information

  • Investor And Analyst Inquiries :

    Gordon Ritchie
    Investor Relations
    (403) 296-7691

    Media And General Inquiries:

    Helen Wesley
    Corporate Communications
    (403) 296-3555