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Linn Energy, LLC (LINE) Message Board

  • rlp2451 rlp2451 Feb 28, 2013 10:16 PM Flag

    Berry Petroleum 2012 Earnings

    Berry reported net earnings of $172 million, or $3.09 a share for 2012. Revenues for the year were just shy of a billion dollars at $937 million with net cash provided by operating activities of $501 million. These numbers are all higher than the prior year's, when the company reported a loss of $228 million on revenue of $871 million.

    That loss in 2011 was the result of a large impairment charge relating to its East Texas natural gas assets and a non-cash loss on derivative investments. If you back out those charges the company still managed to deliver cash from operating activities of $456 million. Still, 2012 was a year of improvement for the company, especially in production and reserves.

    The drill down
    Overall production averaged 36,402 barrels of oil equivalent per day for the year, with even better results in the fourth quarter as production averaged 39,500 barrels of oil equivalent per day. Oil production growth was the big news item here as it rose from 70% of Berry's production mix in 2011 to 75% of production in 2012.

    Berry also delivered fantastic oil margins with the sales of its California heavy oil being priced at a $9 average premium to West Texas Intermediate. Overall, the company's operating margins rose from $45 per barrel of oil equivalent in 2011 up to $49 in 2012. That high-margin oil would make any producer salivate.

    If you've been following the energy story over the past year you'll know that we've experienced a great bottleneck in takeaway capacity which has resulted in a glut of oil. This has depressed prices with West Texas Intermediate trading at a large discount to global benchmark Brent Crude oil while oil out of the Bakken and the Canadian oil sands have traded at even steeper discounts.

    As of the end of 2012, proved oil and gas reserves were estimated to be 275 million barrels of oil equivalent. The company added 38 million barrels of oil equivalent of proved reserves at its oil properties.

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