Cabot Oil & Gas Corporation : Announces First Quarter Profits, Record Quarterly Production Volumes
04/25/2012| 06:35pm US/Eastern
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HOUSTON, April 25, 2012 /PRNewswire/ -- 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. EDT (8:30 a.m. CDT) 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.
FOR MORE INFORMATION CONTACT
Scott Schroeder (281) 589-4993
CABOT OIL & GAS RESULTS -- Page 3
---------------------------------
OPERATING DATA
Quarter Ended
March 31,
---------
2012 2011
---- ----
PRODUCED NATURAL GAS (Bcf) & OIL (MBbl)
--------------------------------------
Natural Gas
Appalachia 49.6 27.1
Other 6.8 9.3
Total 56.4 36.4
==== ====
Crude/Condensate/NGL 538 226
Equivalent Production (Bcfe) 59.7 37.7
PRICES (1)
---------
Average Produced Gas Sales Price ($/Mcf)
Appalachia $3.77 $4.62
Other $2.82 $4.85
Total $3.65 $4.68
Average Crude/Condensate
Price ($/Bbl) $96.67 $87.15
WELLS DRILLED
-------------
Gross 31 24
Net 23 17
Gross Success Rate 100% 100%
(1) These realized prices include the
realized impact of derivative
instrument settlements.
Quarter Ended
March 31,
---------
2012 2011
---- ----
Realized Impacts to Gas Pricing $1.00 $0.37
Realized Impacts to Oil Pricing $(2.57) $(1.42)
CABOT OIL & GAS RESULTS -- Page 4
---------------------------------
CONDENSED CONSOLIDATED STATEMENT OF
OPERATIONS (Unaudited)
(In thousands, except per share amounts)
Quarter Ended
March 31,
---------
2012 2011
---- ----
Operating Revenues
Natural Gas $206,782 $170,098
Brokered Natural Gas 13,444 18,408
Crude Oil and Condensate 49,981 18,592
Other 1,929 1,928
----- -----
272,136 209,026
Operating Expenses
Brokered Natural Gas Cost 11,872 15,362
Direct Operations 27,320 27,007
Transportation and Gathering 30,258 12,868
Taxes Other Than Income 18,583 8,151
Exploration 4,001 6,308
Depreciation, Depletion and
Amortization 110,357 77,124
General and Administrative (excluding
Stock-Based Compensation) 20,894 16,161
Stock-Based Compensation(1) 1,655 8,138
----- -----
224,940 171,119
Gain (Loss) on Sale of Assets (535) (1,517)
---- ------
Income from Operations 46,661 36,390
Interest Expense and Other 16,917 17,367
------ ------
Income Before Income Taxes 29,744 19,023
Income Tax Expense 11,426 6,137
------ -----
Net Income $18,318 $12,886
======= =======
Earnings Per Share - Basic(2) $0.09 $0.06
Weighted Average Common Shares
Outstanding(2) 209,128 208,288
(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.
CABOT OIL & GAS RESULTS -- Page 5
---------------------------------
CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited)
(In thousands)
March 31, December 31,
2012 2011
---- ----
Assets
Current Assets $339,727 $345,800
Properties and
Equipment, Net 4,011,203 3,934,584
Other Assets 51,864 51,109
Total Assets $4,402,794 $4,331,493
========== ==========
Liabilities and Stockholders' Equity
Current Liabilities $322,154 $343,344
Long-Term Debt,
excluding Current
Maturities 1,012,000 950,000
Deferred Income Taxes 814,189 802,592
Other Liabilities 129,495 130,789
Stockholders' Equity 2,124,956 2,104,768
Total Liabilities and
Stockholders' Equity $4,402,794 $4,331,493
========== ==========
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited)
(In thousands)
Quarter Ended
March 31,
---------
2012 2011
---- ----
Cash Flows From Operating Activities
Net Income $18,318 $12,886
Deferred Income Tax
Expense 9,724 6,543
Loss (Gain) on Sale of
Assets 535 1,517
Exploration Expense 49 493
Unrealized (Gain) Loss
on Derivatives (42) (17)
Income Charges Not
Requiring Cash 109,951 90,858
Changes in Assets and
Liabilities (6,755) (21,067)
Net Cash Provided by
Operations 131,780 91,213
------- ------
Cash Flows From Investing Activities
Capital Expenditures (188,547) (203,169)
Proceeds from Sale of
Assets 1,280 5,043
Net Cash Used in
Investing (187,267) (198,126)
-------- --------
Cash Flows From Financing Activities
Net Increase (Decrease)
in Debt 62,000 80,000
Dividends Paid (4,177) (3,122)
Other 81 (1,018)
Net Cash Provided by
Financing 57,904 75,860
------ ------
Net Increase /
(Decrease) in Cash and
Cash Equivalents $2,417 $(31,053)
====== ========
CABOT OIL & GAS RESULTS -- Page 6
---------------------------------
Selected Item Review and Reconciliation of Net Income and Earnings Per Share
(In thousands, except per share amounts)
Quarter Ended
March 31,
---------
2012 2011
---- ----
As Reported - Net Income $18,318 $12,886
Reversal of Selected Items, Net of Tax:
(Gain) Loss on Sale
of Assets 327 941
Stock-Based Compensation Expense 1,013 5,046
Pension Expense (1) 3,824 1,872
Unrealized Loss (Gain) on
Derivatives(2) (26) (11)
Pennsylvania
Impact Fee(3) 5,067 -
Net Income Excluding Selected Items $28,523 $20,734
======= =======
As Reported - Earnings Per Share(4) $0.09 $0.06
Per Share Impact of Reversing Selected Items (4) 0.05 0.04
Earnings Per Share Including Reversal
of Selected Items(4) $0.14 $0.10
Weighted Average Common Shares Outstanding(4) 209,128 208,288
(1) 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.
(2) 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.
(3) 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.
(4) 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)
Quarter Ended
March 31,
---------
2012 2011
---- ----
Discretionary Cash Flow
As Reported - Net Income $18,318 $12,886
Plus / (Less):
Deferred Income Tax Expense 9,724 6,543
Loss (Gain) on Sale of Assets 535 1,517
Exploration Expense 49 493
Unrealized Loss (Gain) on Derivatives (42) (17)
Income Charges Not Requiring Cash 109,951 90,858
------- ------
Discretionary Cash Flow 138,535 112,280
Changes in Assets and Liabilities (6,755) (21,067)
Net Cash Provided by Operations $131,780 $91,213
======== =======
Net Debt Reconciliation
(In thousands)
March 31, December 31,
2012 2011
---- ----
Total Debt $1,012,000 $950,000
Stockholders' Equity 2,124,956 2,104,768
--------- ---------
Total Capitalization $3,136,956 $3,054,768
Total Debt $1,012,000 $950,000
Less: Cash and Cash Equivalents (32,328) (29,911)
------- -------
Net Debt $979,672 $920,089
Net Debt $979,672 $920,089
Stockholders' Equity 2,124,956 2,104,768
--------- ---------
Total Adjusted Capitalization $3,104,628 $3,024,857
Total Debt to Total Capitalization Ratio 32.3% 31.1%
Less: Impact of Cash and Cash Equivalents 0.7% 0.7%
--- ---
Net Debt to Adjusted Capitalization Ratio 31.6% 30.4%
SOURCE Cabot Oil & Gas Corporation
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