Item 2.02 Results of Operations and Financial Condition
Below is a summary of selected operational and financial metrics of the Company
for the third quarter ended September 30, 2020:
1. The Company expects oil production volumes of approximately 200 thousand
barrels per day for the third quarter ended September 30, 2020.
2. The company expects capital expenditures of approximately $280 million
for the third quarter ended September 30, 2020.
3. The company expects cash flow from operations to exceed $600 million for
the third quarter ended September 30, 2020.
The information included in this Current Report is preliminary in nature and
represents management's current estimates. Such information is not final and is
subject to change in the Company's unaudited financial statements to be included
in the Quarterly Report on Form 10-Q for the quarter ended September 30, 2020
(the "Form 10-Q"). Investors should consider such estimates when taken as a
whole with the complete financial statements and results of operations for the
period once published in the Form 10-Q.
THE INFORMATION CONTAINED IN THIS CURRENT REPORT SHALL NOT BE DEEMED "FILED" FOR
THE PURPOSES OF SECTION 18 OF THE SECURITIES AND EXCHANGE ACT OF 1934, NOR SHALL
IT BE DEEMED INCORPORATED BY REFERENCE INTO ANY REGISTRATION STATEMENT OR OTHER
FILING PURSUANT TO THE SECURITIES ACT OF 1933, EXCEPT AS OTHERWISE EXPRESSLY
STATED IN SUCH FILING.
Additional Information and Where to Find It
In connection with the proposed merger between ConocoPhillips ("ConocoPhillips")
and Concho Resources Inc. ("Concho"), ConocoPhillips intends to file with the
SEC a registration statement on Form S-4 that will include a joint proxy
statement of Concho and ConocoPhillips and that also constitutes a prospectus of
ConocoPhillips. Each of Concho and ConocoPhillips may also file other relevant
documents with the SEC regarding the proposed transaction. This document is not
a substitute for the joint proxy statement/prospectus or registration statement
or any other document that Concho or ConocoPhillips may file with the SEC. The
definitive joint proxy statement/prospectus (if and when available) will be
mailed to stockholders of Concho and ConocoPhillips. INVESTORS AND SECURITY
HOLDERS ARE URGED TO READ THE REGISTRATION STATEMENT, JOINT PROXY
STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT DOCUMENTS THAT MAY BE FILED WITH THE
SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THESE DOCUMENTS, CAREFULLY AND
IN THEIR ENTIRETY IF AND WHEN THEY BECOME AVAILABLE BECAUSE THEY CONTAIN OR WILL
CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION. Investors and
security holders will be able to obtain free copies of the registration
statement and joint proxy statement/prospectus (if and when available) and other
documents containing important information about Concho, ConocoPhillips, and the
proposed transaction, once such documents are filed with the SEC through the
website maintained by the SEC at http://www.sec.gov. Copies of documents filed
with the SEC by Concho will be made available free of charge on Concho's
investor relations website at https://ir.concho.com/investors/. Copies of the
documents filed with the SEC by ConocoPhillips will be available free of charge
on ConocoPhillips' website at http://www.conocophillips.com or by contacting
ConocoPhillips' Investor Relations Department by email at
investor.relations@conocophillips.com or by phone at 281-293-5000.
No Offer or Solicitation
This communication is not intended to and shall not constitute an offer to buy
or sell or the solicitation of an offer to buy or sell any securities, or a
solicitation of any vote or approval, nor shall there be any sale of securities
in any jurisdiction in which such offer, solicitation or sale would be unlawful
prior to registration or qualification under the securities laws of any such
jurisdiction. No offering of securities shall be made, except by means of a
prospectus meeting the requirements of Section 10 of the U.S. Securities Act of
1933, as amended.
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Participants in the Solicitation
Concho, ConocoPhillips, and certain of their respective directors and executive
officers may be deemed to be participants in the solicitation of proxies in
respect of the proposed transaction. Information about the directors and
executive officers of Concho, including a description of their direct or
indirect interests, by security holdings or otherwise, is set forth in Concho's
proxy statement for its 2020 Annual Meeting of Stockholders, which was filed
with the SEC on March 16, 2020, and Concho's Annual Report on Form 10-K for the
fiscal year ended December 31, 2019, which was filed with the SEC on
February 19, 2020. Information about the directors and executive officers of
ConocoPhillips, including a description of their direct or indirect interests,
by security holdings or otherwise, is set forth in ConocoPhillips' proxy
statement for its 2020 Annual Meeting of Stockholders, which was filed with the
SEC on March 30, 2020, and ConocoPhillips' Annual Report on Form 10-K for the
fiscal year ended December 31, 2019, which was filed with the SEC on
February 18, 2020, as well as in Forms 8-K filed by ConocoPhillips with the SEC
on May 20, 2020 and September 8, 2020, respectively. Other information regarding
the participants in the proxy solicitations and a description of their direct
and indirect interests, by security holdings or otherwise, will be contained in
the joint proxy statement/prospectus and other relevant materials to be filed
with the SEC regarding the proposed transaction when such materials become
available. Investors should read the joint proxy statement/prospectus carefully
when it becomes available before making any voting or investment decisions. You
may obtain free copies of these documents from Concho or ConocoPhillips using
the sources indicated above.
Cautionary Statement Regarding Forward-Looking Statements
The foregoing contains statements that may constitute forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of 1995, as
amended. All statements, other than statements of historical fact, included in
this communication that address activities, events or developments that Concho
or ConocoPhillips expects, believes or anticipates will or may occur in the
future are forward-looking statements. Words such as "estimate," "project,"
"predict," "believe," "expect," "anticipate," "potential," "create," "intend,"
"could," "may," "foresee," "plan," "will," "guidance," "look," "outlook,"
"goal," "future," "assume," "forecast," "build," "focus," "work," "continue" or
the negative of such terms or other variations thereof and words and terms of
similar substance used in connection with any discussion of future plans,
actions, or events identify forward-looking statements. However, the absence of
these words does not mean that the statements are not forward-looking. These
forward-looking statements include, but are not limited to, statements regarding
the proposed transaction, pro forma descriptions of the combined company and its
operations, integration and transition plans, synergies, opportunities and
anticipated future performance. There are a number of risks and uncertainties
that could cause actual results to differ materially from the forward-looking
statements included in this document. These include, but are not limited to, the
following: the risk factors discussed or referenced in Concho's and
ConocoPhillips' most recent Annual Reports on Form 10-K, Quarterly Reports on
Form 10-Q and Current Reports on Forms 8-K and other filings with the SEC; the
impact of public health crises, such as pandemics (including coronavirus
(COVID-19)) and epidemics and any related company or government policies and
actions to protect the health and safety of individuals or government policies
or actions to maintain the functioning of national or global economies and
markets; global and regional changes in the demand, supply, prices,
differentials or other market conditions affecting oil and gas and the resulting
actions in response to such changes, including changes resulting from the
imposition or lifting of crude oil production quotas or other actions that might
be imposed by the Organization of Petroleum Exporting Countries and other
producing countries; changes in commodity prices; changes in expected levels of
oil and gas reserves or production; operating hazards, drilling risks,
unsuccessful exploratory activities; unexpected cost increases or technical
difficulties in constructing, maintaining, or modifying company facilities;
legislative and regulatory initiatives addressing global climate change or other
environmental concerns; investment in and development of competing or
alternative energy sources; disruptions or interruptions impacting the
transportation for oil and gas production; international monetary conditions and
exchange rate fluctuations; changes in international trade relationships,
including the imposition of trade restrictions or tariffs on any materials or
products (such as aluminum and steel) used in the operation of Concho's
business; the risk associated with Concho's and ConocoPhillips' ability to
obtain the approvals of their respective stockholders required to consummate the
proposed transaction and the timing of the closing of the proposed transaction,
including the risk that the conditions to the transaction are not satisfied on a
timely basis or at all or the failure of the transaction to close for any other
reason or to close on the anticipated terms, including the anticipated tax
treatment; the risk that any regulatory approval, consent or authorization that
may be required for the proposed transaction is not obtained or is obtained
subject to conditions that are not anticipated; the ability to successfully
integrate the businesses and technologies; the occurrence of any event, change
or other circumstances that could give rise to the termination of the merger
agreement; unanticipated difficulties or expenditures relating to the
transaction, the response of business partners and retention as a result of the
announcement and pendency of the transaction; uncertainty as to the long-term
value of ConocoPhillips' common stock; and the diversion of management time on
transaction-related matters; the potential for litigation related to the
proposed transaction; the risk that any announcements relating to the proposed
transaction could have adverse effects on the market price of Concho's common
stock or ConocoPhillips' common stock; the risk that the proposed transaction
and its announcement could have an adverse effect on the ability of Concho and
ConocoPhillips to retain customers and retain and hire key personnel and
maintain relationships with their suppliers and customers and on their operating
results and businesses generally; the risk that problems may arise in
successfully integrating the businesses of the companies, which may result in
the combined company not operating as effectively and efficiently as expected;
the risk that the combined company may be unable to achieve synergies or it may
take longer than expected to achieve those synergies; and other important
factors that could cause actual results to differ materially from those
projected. The effects of the COVID-19 pandemic may give rise to risks that are
currently unknown or amplify the risks associated with many of these factors.
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Additional information concerning these and other risk factors are also
contained in Concho's and ConocoPhillips' most recently filed Annual Reports on
Form 10-K, subsequent Quarterly Reports on Form 10-Q, Current Reports on Form
8-K and other SEC filings.
Many of these risks, uncertainties and assumptions are beyond Concho's or
ConocoPhillips' ability to control or predict. Because of these risks,
uncertainties and assumptions, readers should not place undue reliance on these
forward-looking statements. Nothing in this communication is intended, or is to
be construed, as a profit forecast or to be interpreted to mean that earnings
per share of Concho or ConocoPhillips for the current or any future financial
years or those of the combined company will necessarily match or exceed the
historical published earnings per share of Concho or ConocoPhillips, as
applicable. Neither Concho nor ConocoPhillips gives any assurance (1) that
either Concho or ConocoPhillips will achieve their expectations, or
(2) concerning any result or the timing thereof, in each case, with respect to
the proposed transaction or any regulatory action, administrative proceedings,
government investigations, litigation, warning letters, consent decree, cost
reductions, business strategies, earnings or revenue trends or future financial
results. Concho and ConocoPhillips undertake no obligation to correct or update
any forward-looking statement, except as required by applicable law.
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