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Abraxas Petroleum 2Q profit rises on hedging gain

SAN ANTONIO (AP) -- Abraxas Petroleum Corp. reported Thursday that its second-quarter profit rose 22 percent, mostly on gains from hedging contracts, as production increases were offset by weaker prices.

Net income was $10.9 million, or 12 cents per share, compared with $8.9 million, or 10 cents per share, a year ago.

Excluding $10.3 million in gains from derivatives contracts, which must be valued each quarter, the company said it would have earned 2 cents per share compared to a penny per share last year.

That matched the forecast of analysts, who usually exclude one-time items, according to FactSet.

Revenue fell 4 percent to $15.9 million. Analysts expected $19.7 million.

Production rose 12 percent from the first quarter, including the company's interest in Blue Eagle activities. Slightly more than half was in oil or gas liquids.

Abraxas shares fell 18 cents, or 7 percent, to $2.38 in afternoon trading.