Occidental Petroleum Corporation (NYSE:OXY) Q4 2018 Earnings Conference Call Transcript
Feb 13, 2019 • 12:00 pm ET
Good morning, and welcome to the Occidental Petroleum Corporation Fourth Quarter 2018 Earnings Conference Call. All participants will be in listen-only mode. (Operator Instructions) After today's presentation, there will be an opportunity to ask questions. (Operator Instructions) Please note, this event is being recorded.
I would now like to turn the conference over to Jeff Alvarez, Vice President of Investor Relations. Please go ahead.
Thank you, Laura. Good morning, everyone, and thank you for participating in Occidental Petroleum's fourth quarter 2018 conference call.
On the call with us today are Vicki Hollub, President and Chief Executive Officer; Cedric Burgher, Senior Vice President and Chief Financial Officer; Ken Dillon, President, International Oil and Gas Operations; and BJ Hebert, President of OxyChem. In just a moment, I will turn the call over to Vicki.
As a reminder, today's conference call contains certain projections and other forward-looking statements within the meaning of the federal securities laws. These statements are subject to risks and uncertainties that may cause actual results to differ materially from those expressed or implied in these statements as more fully described in our cautionary statement regarding forward-looking statements on Slide 2.
Our earnings press release, the Investor Relations supplemental schedules and our non-GAAP to GAAP reconciliations and the conference call presentation slides can be downloaded off our website at www.oxy.com.
I'll now turn the call over to Vicki. Vicki, please go ahead.
Thank you, Jeff, and good morning, everyone. Today, I'll begin our fourth quarter results followed by our 2018 achievements, the plan for the year ahead and an overview of the benefits of our integrated business model.
The fourth quarter of 2018 wrapped up a successful year for Oxy, both financially and operationally. We returned $900 million to shareholders in the quarter through a combination of the dividend and share repurchases. Our continued focus on increasing returns for our shareholders was achieved due to outstanding performance from all three of our businesses in a changing market condition.
Despite WTI falling below $43 a barrel in the quarter, we posted core earnings per share of $1.22 and generated the highest semi-annual level of operating cash flow since 2014, making the second half of 2018 our strongest six-month period since our portfolio optimization.
Permian cash operating costs were the lowest this decade, driven by the long-term high return investments that we're making such as in facilities and infrastructure. We operate our assets with a full life cycle view. Our investments will continue to provide payback in the form of lower cost as our production base expands.
OxyChem and our Midstream business both achieved record fourth quarter earnings as a result of our integrated business model, which enables us to take full advantage of market conditions, such as delivering higher realizations from our Permian takeaway position.
In 2018, we grew cash flow to a level that exceeded both capital expenditures and our dividend, a key achievement we had been working towards since completing our portfolio optimization. Organic cash flow growth was driven by