Attached files
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| 8-K - 8-K - CABOT OIL & GAS CORP | a12-10259_18k.htm |
Exhibit 99.1
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NEWS RELEASE |
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840 Gessner Rd., Houston, Texas 77024-4152 |
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P. O. Box 4544, Houston, Texas 77210-4544 |
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(281) 589-4600 |
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FOR RELEASE |
FOR MORE INFORMATION CONTACT |
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April 25, 2012 |
Scott Schroeder (281) 589-4993 |
Cabot Oil & Gas Corporation
Cabot Oil & Gas Corporation Announces First Quarter Profits,
Record Quarterly Production Volumes
HOUSTON, April 25, 2012 - Cabot Oil & Gas Corporation (NYSE: COG) today announced an improvement in first quarter profits over last year, driven primarily from continued expansion of the Company’s production base, with both oil and natural gas volumes setting new Company production records.
The Company posted net income of $18.3 million, or $0.09 per share, cash flow from operations of $131.8 million and discretionary cash flow of $138.5 million for the first quarter of 2012. This compares to the first quarter of 2011 when the Company reported net income of $12.9 million, or $0.06 per share, cash flow from operations of $91.2 million and discretionary cash flow of $112.3 million. Excluding the effect of certain selected items detailed in the tables below, first quarter 2012 net income was $28.5 million, or $0.14 per share, compared to $20.7 million, or $0.10 per share, in first quarter 2011.
Production during the first quarter 2012 was 59.7 Bcfe, with 56.4 Bcf of natural gas production and 538 thousand barrels of liquids production. These figures represent increases of 58 percent, 55 percent, and 138 percent, respectively, compared to the first quarter 2011. Production was the strongest ever reported; however, realized pricing was mixed. Natural gas price realizations were down 22 percent to $3.65 per Mcf in first quarter 2012, while oil price realizations were up 11 percent to $96.67 per barrel. “Even with the significant reduction in realized natural gas prices between first quarters, we were able to grow oil and gas revenues by 36 percent as a result of our record production growth,” said Dan O. Dinges, Chairman, President and Chief Executive Officer. “These results highlight how efforts in each of our areas of focus continue to generate positive momentum. Fortunately, we have the assets, the balance sheet, and the operational ability to weather this cycle and still be opportunistic in order to generate value over the long-term.” Total expenses trended higher between the comparable first quarters, with DD&A, transportation and gathering and taxes other than income increasing the most. However, total per unit costs continued their downward trend due to the ramp up in production.
Conference Call
Listen in live to Cabot Oil & Gas Corporation’s first quarter financial and operating results discussion with financial analysts on Thursday, April 26, 2012 at 9:30 a.m. EST (8:30 a.m. CST) at www.cabotog.com. 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 www.cabotog.com.
Cabot Oil & Gas Corporation, headquartered in Houston, Texas is a leading independent natural gas producer, with its entire resource base located in the continental United States. For additional information, visit the Company’s Internet homepage at 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
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Quarter Ended |
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March 31, |
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2012 |
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2011 |
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PRODUCED NATURAL GAS (Bcf) & OIL (MBbl) |
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Natural Gas |
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Appalachia |
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49.6 |
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27.1 |
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Other |
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6.8 |
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9.3 |
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Total |
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56.4 |
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36.4 |
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Crude/Condensate/NGL |
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538 |
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226 |
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Equivalent Production (Bcfe) |
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59.7 |
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37.7 |
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PRICES (1) |
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Average Produced Gas Sales Price ($/Mcf) |
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Appalachia |
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$ |
3.77 |
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$ |
4.62 |
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Other |
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$ |
2.82 |
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$ |
4.85 |
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Total |
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$ |
3.65 |
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$ |
4.68 |
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Average Crude/Condensate Price ($/Bbl) |
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$ |
96.67 |
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$ |
87.15 |
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WELLS DRILLED |
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Gross |
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31 |
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24 |
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Net |
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23 |
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17 |
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Gross Success Rate |
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100 |
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100 |
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(1) These realized prices include the realized impact of derivative instrument settlements.
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Quarter Ended |
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March 31, |
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2012 |
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2011 |
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Realized Impacts to Gas Pricing |
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$ |
1.00 |
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$ |
0.37 |
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Realized Impacts to Oil Pricing |
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$ |
(2.57 |
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$ |
(1.42 |
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CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited)
(In thousands, except per share amounts)
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Quarter Ended |
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March 31, |
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2012 |
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2011 |
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Operating Revenues |
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Natural Gas |
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$ |
206,782 |
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$ |
170,098 |
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Brokered Natural Gas |
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13,444 |
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18,408 |
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Crude Oil and Condensate |
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49,981 |
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18,592 |
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Other |
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1,929 |
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1,928 |
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272,136 |
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209,026 |
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Operating Expenses |
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Brokered Natural Gas Cost |
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11,872 |
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15,362 |
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Direct Operations |
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27,320 |
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27,007 |
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Transportation and Gathering |
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30,258 |
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12,868 |
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Taxes Other Than Income |
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18,583 |
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8,151 |
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Exploration |
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4,001 |
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6,308 |
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Depreciation, Depletion and Amortization |
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110,357 |
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77,124 |
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General and Administrative (excluding Stock-Based Compensation) |
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20,894 |
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16,161 |
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Stock-Based Compensation (1) |
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1,655 |
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8,138 |
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224,940 |
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171,119 |
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Gain (Loss) on Sale of Assets |
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(535 |
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(1,517 |
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Income from Operations |
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46,661 |
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36,390 |
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Interest Expense and Other |
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16,917 |
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17,367 |
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Income Before Income Taxes |
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29,744 |
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19,023 |
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Income Tax Expense |
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11,426 |
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6,137 |
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Net Income |
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$ |
18,318 |
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$ |
12,886 |
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Earnings Per Share - Basic (2) |
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$ |
0.09 |
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$ |
0.06 |
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Weighted Average Common Shares Outstanding (2) |
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209,128 |
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208,288 |
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(1) Includes the impact of the Company’s performance share awards and restricted stock amortization as well as expense related to stock appreciation rights. Also includes expense for the Supplemental Employee Incentive Plan.
(2) All Earning Per Share and Weighted Average Common Share figures have been retroactively adjusted for the 2-for-1 split of the Company’s common stock effective January 25, 2012.
CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited)
(In thousands)
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March 31, |
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December 31, |
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2012 |
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2011 |
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Assets |
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Current Assets |
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$ |
339,727 |
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$ |
345,800 |
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Properties and Equipment, Net |
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4,011,203 |
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3,934,584 |
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Other Assets |
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51,864 |
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51,109 |
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Total Assets |
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$ |
4,402,794 |
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$ |
4,331,493 |
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Liabilities and Stockholders’ Equity |
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Current Liabilities |
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$ |
322,154 |
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$ |
343,344 |
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Long-Term Debt, excluding Current Maturities |
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1,012,000 |
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950,000 |
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Deferred Income Taxes |
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814,189 |
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802,592 |
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Other Liabilities |
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129,495 |
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130,789 |
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Stockholders’ Equity |
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2,124,956 |
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2,104,768 |
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Total Liabilities and Stockholders’ Equity |
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$ |
4,402,794 |
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$ |
4,331,493 |
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CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited)
(In thousands)
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Quarter Ended |
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March 31, |
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2012 |
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2011 |
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Cash Flows From Operating Activities |
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Net Income |
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$ |
18,318 |
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$ |
12,886 |
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Deferred Income Tax Expense |
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9,724 |
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6,543 |
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Loss (Gain) on Sale of Assets |
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535 |
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1,517 |
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Exploration Expense |
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49 |
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493 |
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Unrealized (Gain) Loss on Derivatives |
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(42 |
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(17 |
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Income Charges Not Requiring Cash |
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109,951 |
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90,858 |
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Changes in Assets and Liabilities |
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(6,755 |
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(21,067 |
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Net Cash Provided by Operations |
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131,780 |
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91,213 |
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Cash Flows From Investing Activities |
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Capital Expenditures |
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(188,547 |
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(203,169 |
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Proceeds from Sale of Assets |
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1,280 |
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5,043 |
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Net Cash Used in Investing |
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(187,267 |
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(198,126 |
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Cash Flows From Financing Activities |
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Net Increase (Decrease) in Debt |
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62,000 |
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80,000 |
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Dividends Paid |
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(4,177 |
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(3,122 |
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Other |
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81 |
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(1,018 |
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Net Cash Provided by Financing |
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57,904 |
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75,860 |
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Net Increase / (Decrease) in Cash and Cash Equivalents |
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$ |
2,417 |
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$ |
(31,053 |
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Selected Item Review and Reconciliation of Net Income and Earnings Per Share
(In thousands, except per share amounts)
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Quarter Ended |
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March 31, |
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2012 |
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2011 |
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As Reported - Net Income |
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$ |
18,318 |
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$ |
12,886 |
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Reversal of Selected Items, Net of Tax: |
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(Gain) Loss on Sale of Assets |
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327 |
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941 |
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Stock-Based Compensation Expense |
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1,013 |
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5,046 |
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Pension Expense (1) |
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3,824 |
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1,872 |
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Unrealized Loss (Gain) on Derivatives (2) |
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(26 |
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(11 |
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Pennsylvania Impact Fee (3) |
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5,067 |
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— |
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Net Income Excluding Selected Items |
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$ |
28,523 |
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$ |
20,734 |
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As Reported - Earnings Per Share (4) |
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$ |
0.09 |
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$ |
0.06 |
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Per Share Impact of Reversing Selected Items (4) |
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0.05 |
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0.04 |
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Earnings Per Share Including Reversal of Selected Items (4) |
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$ |
0.14 |
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$ |
0.10 |
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Weighted Average Common Shares Outstanding (4) |
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209,128 |
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208,288 |
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(1) |
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On July 28, 2010, the Company notified its employees of its plan to terminate its qualified and non-qualified pension plans, effective September 30, 2010. The quarter ended March 31, 2012 and 2011 amounts represent pension expenses related to the plan terminations and expenses related to the acceleration of amortization of prior service costs and actuarial losses over the expected amortization period until final distribution of assets from each plan. Final distribution is expected to occur at the end of the second quarter 2012, at which time the accounting for the costs associated with the pension termination will be complete. Pension expense is included in General and Administrative expense in the Condensed Consolidated Statement of Operations. |
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(2) |
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This unrealized loss (gain) is included in Natural Gas Revenues in the Condensed Consolidated Statement of Operations and represents the change in fair value related to derivatives not designated as hedging instruments. |
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(3) |
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In February 2012, the Pennsylvania state legislature authorized the assessment of an impact fee on Marcellus shale production. This amount represents the adjustment related to our 2011 and prior wells. Expense associated with the impact fee is included in Taxes Other Than Income in the Condensed Consolidated Statement of Operations. |
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(4) |
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All Earning Per Share and Weighted Average Common Share figures have been retroactively adjusted for the 2-for-1 split of the Company’s common stock effective January 25, 2012. |
Discretionary Cash Flow Calculation and Reconciliation
(In thousands)
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Quarter Ended |
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March 31, |
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2012 |
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2011 |
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Discretionary Cash Flow |
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As Reported - Net Income |
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$ |
18,318 |
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$ |
12,886 |
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Plus / (Less): |
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Deferred Income Tax Expense |
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9,724 |
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6,543 |
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Loss (Gain) on Sale of Assets |
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535 |
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1,517 |
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Exploration Expense |
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49 |
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493 |
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Unrealized Loss (Gain) on Derivatives |
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(42 |
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(17 |
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Income Charges Not Requiring Cash |
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109,951 |
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90,858 |
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Discretionary Cash Flow |
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138,535 |
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112,280 |
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Changes in Assets and Liabilities |
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(6,755 |
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(21,067 |
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Net Cash Provided by Operations |
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$ |
131,780 |
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$ |
91,213 |
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Net Debt Reconciliation
(In thousands)
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March 31, |
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December 31, |
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2012 |
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2011 |
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Total Debt |
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$ |
1,012,000 |
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$ |
950,000 |
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Stockholders’ Equity |
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2,124,956 |
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2,104,768 |
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Total Capitalization |
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$ |
3,136,956 |
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$ |
3,054,768 |
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Total Debt |
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$ |
1,012,000 |
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$ |
950,000 |
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Less: Cash and Cash Equivalents |
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(32,328 |
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(29,911 |
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Net Debt |
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$ |
979,672 |
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$ |
920,089 |
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Net Debt |
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$ |
979,672 |
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$ |
920,089 |
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Stockholders’ Equity |
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2,124,956 |
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2,104,768 |
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Total Adjusted Capitalization |
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$ |
3,104,628 |
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$ |
3,024,857 |
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Total Debt to Total Capitalization Ratio |
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32.3 |
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31.1 |
% | ||
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Less: Impact of Cash and Cash Equivalents |
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0.7 |
% |
0.7 |
% | ||
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Net Debt to Adjusted Capitalization Ratio |
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31.6 |
% |
30.4 |
% | ||