Cabot Oil & Gas Corporation Announces First Quarter 2013 Results, Equivalent Production Grew 50 Percent Year-Over-Year PR Newswire HOUSTON, April 24, 2013 HOUSTON, April 24, 2013 /PRNewswire/ -- Cabot Oil & Gas Corporation (NYSE: COG) today reported its financial results for the first quarter of 2013. Highlights for the quarter include: oProduction of 89.3 billion cubic feet equivalent (Bcfe), an increase of 50 percent over last year's comparable quarter and 13 percent over the fourth quarter of 2012. oNet income of $42.8 million, or $0.20 per share. oNet income excluding selected items of $54.2 million, or $0.26 per share. oCash flow from operations of $212.7 million and discretionary cash flow of $234.4 million. "The success of our drilling program in the Marcellus continues to drive record operating and financial metrics for the Company, including all-time highs for quarterly production, revenues, operating cash flows and discretionary cash flows, despite historically low realized natural gas prices," said Dan O. Dinges, Chairman, President and Chief Executive Officer. Equivalent production in the first quarter of 2013 was 89.3 Bcfe, with 85.2 Bcf of natural gas production and 691,000 barrels of liquids production. These figures represent a 50 percent increase in equivalent production compared to the first quarter of 2012 and an increase of 13 percent sequentially over the fourth quarter of 2012. "Gross Marcellus production during the first quarter of approximately one Bcf per day, resulted in the double-digit sequential production growth rate for the quarter," commented Dinges. "As additional infrastructure projects throughout our Marcellus position come online during the year, it will afford us further increases in production." Cash flow from operations in the first quarter of 2013 was $212.7 million, compared to cash flow from operations of $131.8 million in the first quarter of 2012. Discretionary cash flow in the first quarter of 2013 was $234.4 million, compared to discretionary cash flow of $138.5 million in the first quarter of 2012. Higher equivalent production and, to a lesser extent, higher realized crude oil prices drove the quarter's overall improvement, partially offset by lower realized natural gas prices and increased operating expenses associated with higher production. Net income in the first quarter of 2013 was $42.8 million, or $0.20 per share, compared to net income of $18.3 million, or $0.09 per share, in the first quarter of 2012. Excluding the effect of selected items (detailed in the table below), net income was $54.2 million, or $0.26 per share, in the first quarter of 2013, compared to $28.5 million, or $0.14 per share, in the first quarter of 2012. Natural gas price realizations, including the effect of hedges, were $3.45 per Mcf in the first quarter of 2013, down 5 percent compared to the first quarter of 2012. "More recently, the momentum in the natural gas market has shifted positively, as unhedged gas price realizations improved 24 percent between comparable first quarters," added Dinges. Oil price realizations, including the effect of hedges, were $104.03 per Bbl, up 8 percent compared to the first quarter of 2012. Total per unit costs (including financing) decreased to $3.29 per thousand cubic feet equivalent (Mcfe) in the first quarter of 2013, down 15 percent from $3.85 per Mcfe in the first quarter of 2012. All operating expense categories decreased on a per unit basis relative to last year's comparable quarter, except for transportation and gathering expense and general and administrative expense. Transportation and gathering expense per unit was $0.52 per Mcfe in the first quarter of 2013, up 2 percent from $0.51 per Mcfe in the first quarter of 2012. General and administrative expense per unit was $0.40 per Mcfe in the first quarter of 2013, up 5 percent from $0.38 per Mcfe in the first quarter of 2012, due primarily to an increase in stock-based compensation expense. Financial Position and Liquidity At March 31, 2013, the Company's total debt was $1.1 billion, of which $365 million is outstanding under the Company's credit facility. Effective April 17, 2013, the lenders under the Company's revolving credit facility approved an increase in the Company's borrowing base from $1.7 billion to $2.3 billion as part of the annual redetermination under the terms of the credit facility. Total lender commitments under the Company's credit facility remained at $900 million, with $534 million of available credit under its facility at March 31, 2013. As of March 31, 2013, the Company's net debt to adjusted capitalization ratio was 34.3 percent, compared to 33.2 percent at December 31, 2012 (see attached table for the calculation). Conference Call Listen in live to Cabot Oil & Gas Corporation's first quarter financial and operating results discussion with financial analysts on Thursday, April 25, 2013, at 9:30 a.m. EST (8:30 a.m. CST) at www.cabotog.com. The latest financial guidance, including the Company's hedge positions, along with a replay of the webcast, which will be archived for one year, are available in the Investor Info section of the Company's website at www.cabotog.com. Cabot Oil & Gas Corporation, headquartered in Houston, Texas is a leading independent natural gas producer, with its entire resource base located in the continental United States. For additional information, visit the Company's homepage at www.cabotog.com. The statements regarding future financial performance and results and the other statements which are not historical facts contained in this release are forward-looking statements that involve risks and uncertainties, including, but not limited to, market factors, the market price (including regional basis differentials) of natural gas and oil, results of future drilling and marketing activity, future production and costs, and other factors detailed in the Company's Securities and Exchange Commission filings. FOR MORE INFORMATION CONTACT Matt Kerin (281) 589-4642 OPERATING DATA Three Months Ended March 31, 2013 2012 PRODUCED NATURAL GAS (Bcf) & OIL (MBbl) Natural Gas Appalachia 79.9 49.6 Other 5.3 6.8 Total 85.2 56.4 Crude/Condensate/NGL 691 538 Equivalent Production (Bcfe) 89.3 59.7 PRICES^(1) Average Produced Gas Sales Price ($/Mcf) Appalachia $ 3.49 $ 3.77 Other $ 2.79 $ 2.82 Total $ 3.45 $ 3.65 Average Crude/Condensate Price ($/Bbl) $ 104.03 $ 96.67 WELLS DRILLED Gross 32 31 Net 26 23 Gross success rate 97% 100% ^(1) These realized prices include the realized impact of derivative instrument settlements. Three Months Ended March 31, 2013 2012 Realized impacts to gas pricing $ 0.16 $ 1.00 Realized impacts to oil pricing $ 3.24 $ (2.57) CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited) (In thousands, except per share amounts) Three Months Ended March 31, 2013 2012 Operating Revenues Natural gas $ 293,793 $ 206,782 Crude oil and condensate 65,655 49,981 Brokered natural gas 10,893 13,444 Other 2,944 1,929 373,285 272,136 Operating Expenses Direct operations 31,497 27,320 Transportation and gathering 46,221 30,258 Brokered natural gas 8,389 11,872 Taxes other than income 11,687 18,583 Exploration 4,024 4,001 Depreciation, depletion and amortization 148,653 110,357 General and administrative (excluding 17,035 20,894 stock-based compensation) Stock-based compensation^(1) 18,669 1,655 286,175 224,940 Gain (loss) on sale of assets (96) (535) Income from Operations 87,014 46,661 Interest expense and other 16,255 16,917 Income before income taxes 70,759 29,744 Income tax expense 27,935 11,426 Net Income $ $ 42,824 18,318 Earnings per share - Basic $ $ 0.20 0.09 Weighted average common shares outstanding 210,150 209,128 ^(1) Includes the impact of the Company's performance share awards, restricted stock, stock appreciation rights and expense associated with the Supplemental Employee Incentive Plan. The increase in the expense is due to the Company's higher stock price and the resulting mark-to-market for liability awards. CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited) (In thousands) March 31, December 31, 2013 2012 Assets Current assets $ $ 238,880 270,310 Properties and equipment, net 4,412,772 4,310,977 Other assets 36,184 35,026 Total assets $ $ 4,687,836 4,616,313 Liabilities and Stockholders' Equity Current liabilities $ $ 447,264 444,139 Long-term debt, excluding current 1,052,000 1,012,000 maturities Deferred income taxes 910,608 882,672 Other liabilities 154,750 146,055 Stockholders' equity 2,123,214 2,131,447 Total liabilities and stockholders' $ $ equity 4,687,836 4,616,313 CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited) (In thousands) Three Months Ended March 31, 2013 2012 Cash Flows From Operating Activities Net income $ $ 42,824 18,318 Deferred income tax expense 23,574 9,724 Loss (gain) on sale of assets 96 535 Exploration expense 666 49 Unrealized (gain) loss on derivatives - (42) Income charges not requiring cash 167,205 109,951 Changes in assets and liabilities (21,680) (6,755) Net cash provided by operations 212,685 131,780 Cash Flows From Investing Activities Capital expenditures (260,169) (188,547) Proceeds from sale of assets 486 1,280 Investment in equity method investment (1,250) - Net cash used in investing (260,933) (187,267) Cash Flows From Financing Activities Net increase (decrease) in debt 40,000 62,000 Stock-based compensation tax benefit 2,138 - Dividends paid (4,201) (4,177) Other 32 81 Net cash provided by financing 37,969 57,904 Net increase (decrease) in cash and cash $ $ equivalents (10,279) 2,417 Selected Item Review and Reconciliation of Net Income and Earnings Per Share (In thousands, except per share amounts) Three Months Ended March 31, 2013 2012 As reported - net income $ $ 42,824 18,318 Reversal of selected items, net of tax: (Gain) loss on sale of assets 58 327 Stock-based compensation expense 11,337 1,013 Pension expense^(1) - 3,824 Unrealized loss (gain) on derivatives - (26) Pennsylvania impact fee^(2) - 5,067 Net income excluding selected items $ $ 54,219 28,523 As reported - earnings per share $ $ 0.20 0.09 Per share impact of reversing selected items 0.06 0.05 Earnings per share including reversal of selected items $ $ 0.26 0.14 Weighted average common sharesoutstanding 210,150 209,128 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. These amounts represent pension expenses related to the plan termination, including settlement costs and expenses related to ^(1) the acceleration of amortization of prior service costs and actuarial losses over the period. Final distribution of the pension plan occurred as of the end of the second quarter 2012. Pension expense is included in General and administrative expense in the Condensed Consolidated Statement of Operations. In February 2012, the Pennsylvania state legislature authorized the assessment of an impact fee on Marcellus shale production. This amount ^(2) represents the initial year accrual related to our 2011 and prior wells. Expenses associated with the impact fee are included in Taxes other than income in the Condensed Consolidated Statement of Operations. Discretionary Cash Flow Calculation and Reconciliation (In thousands) Three Months Ended March 31, 2013 2012 Discretionary Cash Flow As reported - net income $ $ 42,824 18,318 Plus / (less): Deferred income tax expense 23,574 9,724 Loss (gain) on sale of assets 96 535 Exploration expense 666 49 Unrealized loss (gain) on derivatives - (42) Income charges not requiring cash 167,205 109,951 Discretionary Cash Flow 234,365 138,535 Changes in assets and liabilities (21,680) (6,755) Net cash provided by operations $ $ 212,685 131,780 Net Debt Reconciliation (In thousands) March 31, December 31, 2013 2012 Current portion of long-term debt $ $ 75,000 75,000 Long-term debt 1,052,000 1,012,000 Total debt 1,127,000 1,087,000 Stockholders' equity 2,123,214 2,131,447 Total Capitalization $ 3,250,214 $ 3,218,447 Total debt $ 1,127,000 $ 1,087,000 Less: Cash and cash equivalents (20,457) (30,736) Net Debt $ 1,106,543 $ 1,056,264 Net debt $ 1,106,543 $ 1,056,264 Stockholders' equity 2,123,214 2,131,447 Total Adjusted Capitalization $ 3,229,757 $ 3,187,711 Total debt to total capitalization ratio 34.7% 33.8% Less: Impact of cash and cash 0.4% 0.5% equivalents Net Debt to Adjusted Capitalization 34.3% 33.2% Ratio SOURCE Cabot Oil & Gas Corporation Website: http://www.cabotog.com
Cabot Oil & Gas Corporation Announces First Quarter 2013 Results, Equivalent Production Grew 50 Percent Year-Over-Year
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