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Cabot Oil & Gas Announces Third Quarter Results
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| Symbol | Price | Change |
|---|---|---|
| COG | 42.13 | 0.00 |
HOUSTON, Oct. 26 /PRNewswire-FirstCall/ -- Cabot Oil & Gas Corporation (NYSE: COG - News) today reported third quarter net income of $38.9 million, or $0.38 per share. Removing the selected items (which are detailed in the Selected Items Table), the quarter's net income was $42.6 million, or $0.41 per share. These figures compare to the 2008 third quarter numbers (for the reported results and after the removal of selected items) of $67.0 million, or $0.65 per share, and $60.1 million, or $0.58 per share, respectively.
Cash flow from operations for the 2009 third quarter totaled $116.7 million, while discretionary cash flow was $158.9 million. Comparatively, 2008 third quarter cash flow from operations was $148.3 million, and discretionary cash flow was $161 million.
"In light of the general market conditions for natural gas, the metrics are very good," said Dan O. Dinges, Chairman, President and Chief Executive Officer. "These results include a five percent increase in third quarter 2009 equivalent production over the third quarter of 2008." The production growth rate was driven by a 24.2 percent increase in the North region production for comparable year over year quarters. Dinges added, "Weighing on the overall growth rate was the sale of our Canadian assets." Pricing, as expected, offset the benefit from increased production. Realized natural gas prices were $7.40 per Mcf in the 2009 third quarter versus $8.66 per Mcf in the 2008 third quarter. Realized oil prices fell 12 percent to $87.49 per barrel. The production and price information have been adjusted to reflect the new North and South regional split for the Company.
Overall costs were up only slightly and were flat on a per unit basis. The largest increases occurred in stock-based compensation and exploration, with the largest declines coming from brokered gas costs and taxes other than income.
Year-to-Date
For the nine months ended September 30, 2009, Cabot reported net income of $112 million, or $1.08 per share, compared to $167.6 million, or $1.68 per share, for the same period last year. The cash flow comparisons for the nine months ended September 30, 2009 and September 30, 2008, respectively, are cash flow from operations of $417.1 million versus $424.7 million and discretionary cash flow of $430.6 million versus $446.5 million. The 2009 nine-month net income figure, after removal of the selected items, was $123.9 million, or $1.20 per share, versus $187.0 million, or $1.87 per share for the nine-month period ended September 30, 2008.
"The same dynamic that drove the quarter results apply to the year-to-date periods - increased production and lower price realizations," stated Dinges. "Production was up approximately ten percent while natural gas and oil prices fell by 14 and 13 percent, respectively."
Conference Call
Listen in live to Cabot Oil & Gas Corporation's third quarter financial and operating results discussion with financial analysts on Tuesday, October 27, 2009 at 9:30 a.m. EDT (8:30 a.m. CDT) at www.cabotog.com. A teleconference replay will also be available at (800) 642-1687, (U.S./Canada) or (706) 645-9291 (International), pass code 33459517. The replay will be available through Thursday, October 29, 2009. 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
Quarter Ended Nine Months Ended
September 30, September 30,
-------------- -----------------
2009 2008 2009 2008
---- ---- ---- ----
PRODUCED NATURAL GAS (Bcf) & OIL (Mbbl)
---------------------------------------
Natural Gas
North 12.2 9.8 34.8 29.3
South 12.0 12.4 37.2 33.4
Canada - 0.8 1.0 3.4
---- ---- ---- ----
Total 24.2 23.0 73.0 66.1
==== ==== ==== ====
Crude/Condensate/Ngl
North 33 32 92 88
South 198 169 526 484
Canada - 6 7 17
---- ---- ---- ----
Total 231 207 625 589
==== ==== ==== ====
Equivalent Production (Bcfe) 25.5 24.2 76.7 69.6
PRICES
Average Produced Gas Sales Price ($/Mcf)
North $6.28 $7.89 $6.56 $8.14
South $8.53 $9.34 $8.25 $9.17
Canada $ - $7.60 $3.56 $7.84
Total (1) $7.40 $8.66 $7.39 $8.64
Average Crude/Condensate Price ($/Bbl)
North $58.49 $109.50 $48.22 $107.21
South $92.12 $97.37 $88.75 $92.89
Canada $ - $100.46 $33.97 $92.03
Total (1) $87.49 $99.34 $82.48 $94.93
WELLS DRILLED
Gross 37 132 119 333
Net 32 115 97 277
Gross Success Rate 97% 99% 98% 99%
(1) These realized prices include the realized impact of derivative
instrument settlements.
Quarter Ended Nine Months Ended
September 30, September 30,
-------------- -----------------
2009 2008 2009 2008
------ ------- ------ -------
Realized Impacts to Gas Pricing $4.25 $(0.30) $3.91 $(0.42)
Realized Impacts to Oil Pricing $23.40 $(15.39) $30.64 $(15.05)
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited)
(In thousands, except per share amounts)
Quarter Ended Nine Months Ended
September 30, September 30,
---------------- -----------------
2009 2008 2009 2008
------- ------- ------- -------
Operating Revenues
Natural Gas Production $177,807 $200,279 $538,542 $569,527
Brokered Natural Gas 9,032 23,855 54,117 86,663
Crude Oil and Condensate 19,574 20,002 50,026 55,089
Other 608 684 3,099 2,046
------- ------- ------- -------
207,021 244,820 645,784 713,325
Operating Expenses
Brokered Natural Gas Cost 7,786 20,891 48,219 75,321
Direct Operations - Field and
Pipeline 23,012 24,974 71,564 65,101
Exploration 14,395 6,413 31,258 18,764
Depreciation, Depletion and
Amortization 62,037 57,407 188,967 152,075
General and Administrative
(excluding Stock-Based
Compensation) 9,629 9,486 32,511 31,265
Stock-Based Compensation (1) 5,292 (9,695) 16,592 29,576
Taxes Other Than Income 10,719 20,627 34,531 56,749
------- ------- ------- -------
132,870 130,103 423,642 428,851
Gain / (Loss) on Sale of
Assets (2) 572 - (3,283) 401
------- ------- ------- -------
Income from Operations 74,723 114,717 218,859 284,875
Interest Expense and Other 14,857 10,486 44,129 22,684
------- ------- ------- -------
Income Before Income Taxes 59,866 104,231 174,730 262,191
Income Tax Expense 20,969 37,241 62,751 94,601
------- ------- ------- -------
Net Income $38,897 $66,990 $111,979 $167,590
======= ======= ======== ========
Net Earnings Per Share - Basic $0.38 $0.65 $1.08 $1.68
Weighted-Average Common Shares
Outstanding 103,647 103,351 103,603 99,858
(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 Plans which commenced in 2008.
(2) The loss on sale of assets in 2009 primarily relates to a loss on our
April 2009 sale of our Canadian properties, partially offset by a
gain on sale of assets from the first quarter 2009 sale of the
Thornwood properties in the East.
CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited)
(In thousands)
September 30, December 31,
2009 2008
---------- ----------
Assets
Current Assets $335,007 $460,551
Property, Equipment and Other Assets 3,254,047 3,241,113
--------- ---------
Total Assets $3,589,054 $3,701,664
========== ==========
Liabilities and Stockholders' Equity
Current Liabilities $247,172 $378,913
Long-Term Debt, excluding Current Maturities 790,000 831,143
Deferred Income Taxes 623,946 599,106
Other Liabilities 104,122 101,940
Stockholders' Equity 1,823,814 1,790,562
---------- ----------
Total Liabilities and Stockholders'
Equity $3,589,054 $3,701,664
========== ==========
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited)
(In thousands)
Quarter Ended Nine Months Ended
September 30, September 30,
------------------ --------------------
2009 2008 2009 2008
-------- -------- -------- ----------
Cash Flows From Operating
Activities
Net Income $38,897 $66,990 $111,979 $167,590
Unrealized (Gain) / Loss
on Derivatives 1,233 (1,260) 418 1,649
Income Charges Not
Requiring Cash 68,418 47,948 208,861 162,446
(Gain) / Loss on Sale of
Assets (572) - 3,283 (401)
Deferred Income Tax
Expense 36,521 40,944 74,773 96,459
Changes in Assets and
Liabilities (29,062) (1,707) (357) (10,768)
Stock-Based Compensation
Tax Benefit (13,085) (11,011) (13,085) (11,011)
Exploration Expense 14,395 6,413 31,258 18,764
-------- -------- -------- ----------
Net Cash Provided by
Operations 116,745 148,317 417,130 424,728
-------- -------- -------- ----------
Cash Flows From Investing
Activities
Capital Expenditures (101,949) (791,728) (394,919) (1,164,339)
Proceeds from Sale of
Assets 513 - 80,180 1,150
Exploration Expense (14,395) (6,413) (31,258) (18,764)
-------- -------- -------- ----------
Net Cash Used in Investing (115,831) (798,141) (345,997) (1,181,953)
-------- -------- -------- ----------
Cash Flows From Financing
Activities
Sale of Common Stock
Proceeds (67) 122 83 316,229
Net Increase / (Decrease)
in Debt (5,000) 555,000 (57,000) 470,000
Capitalized Debt Issuance
Costs - (2,166) (10,409) (2,166)
Stock-Based Compensation
Tax Benefit 13,085 11,011 13,085 11,011
Dividends Paid (3,110) (3,100) (9,323) (8,973)
-------- -------- -------- ----------
Net Cash Provided by /
(Used in) Financing 4,908 560,867 (63,564) 786,101
-------- -------- -------- ----------
Net Increase / (Decrease)
in Cash and Cash
Equivalents $5,822 $(88,957) $7,569 $28,876
======== ======== ======== ==========
Selected Item Review and Reconciliation of Net Income and
Earnings Per Share
(In thousands, except per share amounts)
Quarter Ended Nine Months Ended
September 30, September 30,
----------------- -----------------
2009 2008 2009 2008
------- -------- -------- --------
As Reported - Net Income $38,897 $66,990 $111,979 $167,590
Reversal of Selected Items,
Net of Tax:
(Gain) / Loss on Sale of
Assets (1) (359) - 1,270 (253)
Stock-Based Compensation
Expense 3,323 (6,098) 10,414 18,625
Unrealized (Gain) / Loss
on Derivatives (2) 774 (793) 263 1,040
------- -------- -------- --------
Net Income Excluding Selected
Items $42,635 $60,099 $123,926 $187,002
======= ======== ======== ========
As Reported - Net Earnings Per
Share $0.38 $0.65 $1.08 $1.68
Per Share Impact of Reversing
Selected Items 0.03 (0.07) 0.12 0.19
------- -------- -------- --------
Net Earnings Per Share Including
Reversal of Selected Items $0.41 $0.58 $1.20 $1.87
======= ======== ======== ========
Weighted-Average Common Shares
Outstanding 103,647 103,351 103,603 99,858
(1) The loss on sale of assets in 2009 primarily relates to a loss on our
April 2009 sale of our Canadian properties, partially offset by a
gain on sale of assets from the first quarter 2009 sale of the
Thornwood properties in the East. The loss on sale of assets for the
three and nine months ended September 30, 2009 considers a tax
benefit associated with foreign tax credits.
(2) This unrealized (gain) / loss is included in Natural Gas Production
Revenues in the Condensed Consolidated Statement of Operations and
represents the mark to market change related to the Company's natural
gas basis swaps.
Discretionary Cash Flow Calculation and Reconciliation
(In thousands)
Quarter Ended Nine Months Ended
September 30, September 30,
------------------ ------------------
2009 2008 2009 2008
-------- -------- -------- --------
Discretionary Cash Flow
As Reported - Net Income $38,897 $66,990 $111,979 $167,590
Plus / (Less):
Unrealized (Gain) / Loss on
Derivatives 1,233 (1,260) 418 1,649
Income Charges Not Requiring Cash 68,418 47,948 208,861 162,446
(Gain) / Loss on Sale of Assets (572) - 3,283 (401)
Deferred Income Tax Expense 36,521 40,944 74,773 96,459
Exploration Expense 14,395 6,413 31,258 18,764
-------- -------- -------- --------
Discretionary Cash Flow 158,892 161,035 430,572 446,507
Changes in Assets and Liabilities (29,062) (1,707) (357) (10,768)
Stock-Based Compensation Tax
Benefit (13,085) (11,011) (13,085) (11,011)
-------- -------- -------- --------
Net Cash Provided by Operations $116,745 $148,317 $417,130 $424,728
======== ======== ======== ========
Net Debt Reconciliation
(In thousands)
September 30, December 31,
2009 2008
---------- ----------
Current Portion of Long-Term Debt $20,000 $35,857
Long-Term Debt 790,000 831,143
---------- ----------
Total Debt $810,000 $867,000
Stockholders' Equity 1,823,814 1,790,562
---------- ----------
Total Capitalization $2,633,814 $2,657,562
Total Debt $810,000 $867,000
Less: Cash and Cash Equivalents (35,670) (28,101)
---------- ----------
Net Debt $774,330 $838,899
Net Debt $774,330 $838,899
Stockholders' Equity 1,823,814 1,790,562
---------- ----------
Total Adjusted Capitalization $2,598,144 $2,629,461
Total Debt to Total Capitalization Ratio 30.8% 32.6%
Less: Impact of Cash and Cash Equivalents 1.0% 0.7%
---------- ----------
Net Debt to Adjusted Capitalization
Ratio 29.8% 31.9%
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