Published:
Cabot Oil & Gas Reports Record Second Quarter Profits
HOUSTON, July 24 /PRNewswire-FirstCall/ -- Cabot Oil & Gas Corporation
(NYSE: COG) announced today that on the strength of significantly higher
commodity prices and increased production, the Company reported its highest
second quarter earnings of $54.6 million, or $0.55 per share. After removing
certain selected items related to the gain on sale of assets, stock
compensation and unrealized loss on derivatives (see Selected Item Review and
Reconciliation of Net Income and Earnings Per Share), the net income figure is
$69.9 million, or $0.71 per share, as compared to last year's figures of
$41.2 million, or $0.42 per share. The as-reported profit for the second
quarter of 2007 was $41.4 million, or $0.43 per share.
During the quarter, the Company recorded cash flow from operations of
$143.7 million and discretionary cash flow of $147.1 million, also records for
any second quarter period. These results compare to $105.9 million and
$112.5 million for cash flow from operations and discretionary cash flow,
respectively, in the second quarter of 2007.
"The continued strength in the commodity prices led the significant
improvement in results from 2007 to 2008 second quarter," said Dan O. Dinges,
Chairman, President and Chief Executive Officer. "This combined with our
9.6 percent increase in production made for the unprecedented quarter."
Natural gas price realizations improved 28.5 percent, while oil price
realizations grew 59.2 percent between second quarter comparable periods.
Equivalent production of 23.2 Bcfe, or 255 Mmcfe per day, fell within
guidance (of 250 to 259 Mmcfe per day), and is comparable to last year's
21.2 Bcfe. "While solidly within guidance, our re-direct of personnel and
equipment in the East towards Marcellus activity and new initiatives focused
on evaluation of deeper objectives in several of ourEast Texas fields have
limited the acceleration of our growth for the short term," stated Dinges.
"We have 22 rigs drilling throughout the company with six rigs focused on new
initiatives. We expect to collect new data from several key wells very soon."
Expenses in every category grew, with the largest increases occurring in stock
compensation expense, as a result of the appreciation in the Company's stock
price and DD&A expense in response to industry inflationary pressures.
Year to Date
In the six months ended June 30, 2008, Cabot reported net income of
$100.6 million, or $1.03 per share, compared to $89.9 million or $0.93 per
share last year. The cash flow comparisons included cash flow from operations
of $276.4 million in 2008 versus $241.8 million in 2007, while discretionary
cash flow was $285.5 million in 2008, compared to $219.3 million in 2007.
"The respective 2008 numbers for the six-month period all created new high
water marks for the first half of the year, primarily the result of increased
prices and production," added Dinges.
Other News
Cabot has completed its equity offering and the long-term debt portion of
the funding for its pending acquisition. "Our expectation remains to close
the acquisition in the middle of August," said Dinges.
Conference Call
Listen in live to Cabot Oil & Gas Corporation's second quarter financial
and operating results discussion with financial analysts on Friday, July 25,
2008 at 9:30 a.m. EDT (8:30 a.m. CDT) at http://www.cabotog.com. A
teleconference replay will also be available at (800) 642-1687, (U.S./Canada)
or (706) 645-9291 (International), pass code 53829875. The replay will be
available through Sunday, July 27, 2008. The latest financial guidance,
including the Company's hedge positions, along with a replay of the web cast,
which will be archived for one year, are available in the investor relations
section of the Company's website at http://www.cabotog.com.
Cabot Oil & Gas Corporation, headquartered inHouston, Texas is a leading
independent natural gas producer with substantial interests in the Gulf Coast,
includingTexas andLouisiana; the West, with the Rocky Mountains and Mid-
Continent; the East and inCanada. For additional information, visit the
Company's Internet homepage at http://www.cabotog.com.
The statements regarding future financial performance and results and the
other statements which are not historical facts contained in this release are
forward-looking statements that involve risks and uncertainties, including,
but not limited to, market factors, the market price (including regional basis
differentials) of natural gas and oil, results of future drilling and
marketing activity, future production and costs, and other factors detailed in
the Company's Securities and Exchange Commission filings.
OPERATING DATA
Quarter Ended Six Months Ended
June 30, June 30,
2008 2007 2008 2007
PRODUCED NATURAL
GAS (Bcf) & OIL (MBbl)
Natural Gas
East 5.9 6.2 11.9 12.0
Gulf Coast 7.7 6.4 15.1 12.9
West 7.1 6.4 13.5 12.8
Canada 1.4 0.9 2.6 2.0
Total 22.1 19.9 43.1 39.7
Crude/Condensate/Ngl
East 6 7 12 13
Gulf Coast 136 161 280 309
West 43 43 79 90
Canada 5 4 11 10
Total 190 215 382 422
Equivalent Production (Bcfe) 23.2 21.2 45.4 42.2
PRICES
Average Produced Gas
Sales Price ($/Mcf)
East $9.64 $7.86 $8.96 $7.97
Gulf Coast $10.36 $8.27 $9.35 $8.01
West $8.04 $6.02 $7.67 $6.26
Canada $8.41 $4.25 $7.91 $5.97
Total (1) $9.30 $7.24 $8.63 $7.33
Average Crude/Condensate
Price ($/Bbl)
East $118.33 $59.41 $103.89 $56.60
Gulf Coast $91.87 $62.28 $88.11 $57.85
West $118.18 $62.76 $108.12 $58.33
Canada $96.89 $48.51 $87.26 $51.77
Total (1) $98.68 $61.98 $92.58 $57.76
WELLS DRILLED
Gross 116 122 201 222
Net 97 111 162 203
Gross Success Rate 99% 98% 99% 98%
(1) These realized prices include the realized impact of derivative
instrument settlements.
Quarter Ended Six Months Ended
June 30, June 30,
2008 2007 2008 2007
Realized Impacts to
Gas Pricing $(0.97) $0.66 $(0.48) $0.77
Realized Impacts to
Oil Pricing $(21.19) $- $(14.88) $0.43
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited)
(In thousands, except per share amounts)
Quarter Ended Six Months Ended
June 30, June 30,
2008 2007 2008 2007
Operating Revenues
Natural Gas Production $202,689 $144,128 $369,248 $290,878
Brokered Natural Gas 27,188 18,001 62,808 51,178
Crude Oil and Condensate 18,600 13,263 35,087 24,205
Other 377 440 1,362 1,144
248,854 175,832 468,505 367,405
Operating Expenses
Brokered Natural Gas Cost 24,140 16,051 54,430 44,750
Direct Operations - Field and
Pipeline 22,636 19,004 40,127 36,135
Exploration 7,290 6,825 12,351 12,477
Depreciation, Depletion and
Amortization 48,401 40,585 94,668 77,966
General and Administrative
(excluding Stock-Based
Compensation) 11,782 8,904 21,779 20,549
Stock-Based Compensation (1) 21,695 4,061 39,271 10,696
Taxes Other Than Income 19,225 14,579 36,122 27,744
155,169 110,009 298,748 230,317
Gain on Sale of Assets (2) 401 4,422 401 12,342
Income from Operations 94,086 70,245 170,158 149,430
Interest Expense and Other 6,207 3,619 12,198 7,543
Income Before Income Taxes 87,879 66,626 157,960 141,887
Income Tax Expense 33,254 25,250 57,360 51,964
Net Income $54,625 $41,376 $100,600 $89,923
Net Earnings Per Share - Basic $0.55 $0.43 $1.03 $0.93
Weighted Average Common Shares
Outstanding 98,467 96,929 98,092 96,813
(1) Includes the impact of the Company's performance share awards and
restricted stock amortization as well as expense related to stock
options and stock appreciation rights. Also includes expense for the
Supplemental Employee Incentive Plan which commenced in
January 2008.
(2) Gain on Sale of Assets is primarily related to post-closing
transactions associated with the sale in the third quarter of 2006 of
offshore and certain south Louisiana properties.
CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited)
(In thousands)
June 30, December 31,
2008 2007
Assets
Current Assets $436,758 $221,413
Property, Equipment and Other Assets 2,203,088 1,939,334
Deferred Income Taxes 78,586 47,847
Total Assets $2,718,432 $2,208,594
Liabilities and Stockholders' Equity
Current Liabilities $475,254 $252,266
Long-Term Debt, excluding Current
Maturities 245,000 330,000
Deferred Income Taxes 542,214 481,770
Other Liabilities 156,659 74,301
Stockholders' Equity 1,299,305 1,070,257
Total Liabilities and Stockholders'
Equity $2,718,432 $2,208,594
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited)
(In thousands)
Quarter Ended Six Months Ended
June 30, June 30,
2008 2007 2008 2007
Cash Flows From Operating Activities
Net Income $54,625 $41,376 $100,600 $89,923
Unrealized Loss on Derivatives 2,909 - 2,909 -
Income Charges Not Requiring Cash 50,692 45,032 114,498 89,583
Gain on Sale of Assets (401) (4,422) (401) (12,342)
Deferred Income Tax Expense 31,955 23,738 55,515 39,612
Changes in Assets and Liabilities (8,005) (4,689) (9,061) 28,600
Stock-Based Compensation Tax Benefit 4,642 (1,911) - (6,046)
Exploration Expense 7,290 6,825 12,351 12,477
Net Cash Provided by Operations 143,707 105,949 276,411 241,807
Cash Flows From Investing Activities
Capital Expenditures (244,510) (158,183) (372,611) (271,931)
Proceeds from Sale of Assets 1,150 41 1,150 5,825
Exploration Expense (7,290) (6,825) (12,351) (12,477)
Net Cash Used in Investing (250,650) (164,967) (383,812) (278,583)
Cash Flows From Financing Activities
Sale of Common Stock Proceeds 313,867 1,163 316,107 2,307
Net Increase / (Decrease) in Debt (105,000) 25,000 (85,000) 15,000
Stock-Based Compensation Tax
Benefit (4,642) 1,911 - 6,046
Dividends Paid (2,943) (2,907) (5,873) (4,840)
Net Cash Provided by Financing 201,282 25,167 225,234 18,513
Net Increase / (Decrease) in Cash
and Cash Equivalents $94,339 $(33,851) $117,833 $(18,263)
Selected Item Review and Reconciliation of Net Income and Earnings Per
Share
(In thousands, except per share amounts)
Quarter Ended Six Months Ended
June 30, June 30,
2008 2007 2008 2007
As Reported - Net Income $54,625 $41,376 $100,600 $89,923
Reversal of Selected Items, Net
of Tax:
Gain on Sale of Assets (253) (2,750) (253) (7,677)
Stock-Based Compensation
Expense 13,668 2,526 24,723 6,653
Unrealized Loss on
Derivatives (1) 1,833 - 1,833 -
Net Income Excluding Selected
Items $69,873 $41,152 $126,903 $88,899
As Reported - Net Earnings Per
Share $0.55 $0.43 $1.03 $0.93
Per Share Impact of Reversing
Selected Items 0.16 (0.01) 0.26 (0.01)
Net Earnings Per Share Including
Reversal of Selected Items $0.71 $0.42 $1.29 $0.92
Weighted Average Common Shares
Outstanding 98,467 96,929 98,092 96,813
(1) This unrealized loss is included in Natural Gas Production
Revenues in the Condensed Consolidated Statement of Operations
and represents the mark to market change related to a portion of a
derivative not designated as a hedge.
Discretionary Cash Flow Calculation and Reconciliation
(In thousands)
Quarter Ended Six Months Ended
June 30, June 30,
2008 2007 2008 2007
Discretionary Cash Flow
As Reported - Net Income $54,625 $41,376 $100,600 $89,923
Plus / (Less):
Unrealized Loss on
Derivatives 2,909 - 2,909 -
Income Charges Not
Requiring Cash 50,692 45,032 114,498 89,583
Gain on Sale of Assets (401) (4,422) (401) (12,342)
Deferred Income Tax
Expense 31,955 23,738 55,515 39,612
Exploration Expense 7,290 6,825 12,351 12,477
Discretionary Cash Flow 147,070 112,549 285,472 219,253
Changes in Assets and
Liabilities (8,005) (4,689) (9,061) 28,600
Stock-Based Compensation
Tax Benefit 4,642 (1,911) - (6,046)
Net Cash Provided by
Operations $143,707 $105,949 $276,411 $241,807
Net Debt Reconciliation
(In thousands)
June 30, December 31,
2008 2007
Current Portion of
Long-Term Debt $20,000 $20,000
Long-Term Debt 245,000 330,000
Total Debt $265,000 $350,000
Stockholders' Equity 1,299,305 1,070,257
Total Capitalization $1,564,305 $1,420,257
Total Debt $265,000 $350,000
Less: Cash and Cash
Equivalents (136,331) (18,498)
Net Debt $128,669 $331,502
Net Debt $128,669 $331,502
Stockholders' Equity 1,299,305 1,070,257
Total Adjusted
Capitalization $1,427,974 $1,401,759
Total Debt to Total
Capitalization Ratio 16.9% 24.6%
Less: Impact of Cash and
Cash Equivalents 7.9% 1.0%
Net Debt to Adjusted
Capitalization Ratio 9.0% 23.6%
SOURCE Cabot Oil & Gas Corporation
Copyright © 2009, PRNewswire
Copyright © 2009, NewsBlaze,
Daily NewsTags: ,OIL,ERN,CCA,TX-Cabot-2Q-Earnings
Search News
Daily News
