US oil and gas company Apache‘s profits took a hit during the second quarter of this year as the company reported a 66% drop, primarily due to the near-doubling of income tax provisions and reduced benefits from deferred taxes.

The Houston, Texas-based company said that net income attributable to common stock fell from $572m to $195m for the second quarter. This translates to a fall of $1.50 per share to 51 cents per share.

Apache wrote in its financial report for Q2 that the numbers were not directly comparable.

“These results include a number of items outside of core earnings that are typically excluded by the investment community in their published earnings estimates. When adjusted for these and certain additional items that impact the comparability of results, Apache’s second-quarter earnings were $192 million or $0.50 per share,” the company said.

An almost 50% rise in the current income tax provisions, from $126m in 2017 to $249m, struck a blow to Apache’s profits, while gains from deferred income tax shrunk from $730m to just $10m.

Looking past Apache’s profits

Despite a 66% decrease in Apache’s profits, the company’s share earnings bested analyst’s estimates of 39 cents per share, according to Thomson Reuters.

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Apache CEO and president John J Christmann IV said: “Apache’s operational and strategic delivery have been exceptional through the first half of 2018. We are proactively managing our costs, operating at an activity level that maximizes capital efficiency, and we have established considerable momentum that is now showing up in our results.”

Oil and gas revenue rose from $1.35bn in Q2-2017 to $1.94bn in the same quarter this year.

OPEC-led supply reductions in the last few months have led to the recovery of crude oil prices from the 2016 slump. US crude rose by 18% this quarter to reach $75 per barrel by the end of June. Brent crude futures prices currently stand at $72.55 per barrel.

Apache’s total oil production was up this quarter, from 460,293 barrels of oil equivalent per day (boepd) last year to 464,109 boepd. This included a substantial 39% rise in production at the Permian Basin site to 201,832 boepd.

Christmann added: “In the United States, the Permian Basin was our primary growth driver, with oil production in the Midland and Delaware basins up 20,000 barrels per day year-over-year and 6,000 barrels per day over the first quarter.”

The company also raised its 2018 US production guidance to 260,000 boepd.