HOUSTON, April 29 /PRNewswire-FirstCall/ -- Cabot Oil & Gas Corporation (NYSE: COG) today announced its first quarter results which included the impact of two previously disclosed (February 13, 2003) non-cash selected items. For the first three months of the year, the Company recorded a net loss of $39.2 million, or $1.23 per share, and a near doubling of discretionary cash flow to $67.6 million. These figures compare to a net loss of $0.8 million, or $.03 per share, and discretionary cash flow of $34.4 million in the first quarter of 2002. Cash flow from operations was $59.5 million in the first quarter of 2003 versus $29.5 million in the comparable period for last year.
Selected Items Detail
The 2003 first quarter includes the effects of the Kurten field impairment ($54.4 million after tax) and the adoption of SFAS No. 143 "Accounting for Asset Retirement Obligations" ($6.8 million after tax). Excluding the impact of these selected items Cabot's net income was $22.1 million, or $.69 per share. A detailed reconciliation between this reporting and the GAAP results can be found in the attached statements.
Discussion of Results
Higher realized commodity prices drove revenues up 81 percent over last year's comparable quarter. Realized natural gas prices averaged $2.53 per Mcf in the first quarter of 2002 and $4.55 per Mcf during this year's first quarter. Oil prices exhibited strong gains with a $30.88 per barrel realization for the 2003 first quarter versus $20.55 per barrel during last year's comparable period.
The Company increased its exploration expense with a $5 million additional investment in Gulf Coast seismic over last year's level. Additionally, the significantly higher realized commodity prices resulted in a higher level of production related taxes.
Consistent with the Company's first quarter guidance, production was 3 percent below the level reported in the first quarter of last year. Comparing the fourth quarter of 2002 to the first quarter of 2003, Cabot's daily production was 242.9 Mmcfe per day in the first quarter of 2003 versus 243.9 Mmcfe per day in the fourth quarter of 2002, essentially flat between periods.
Commenting on the quarter, Dan O. Dinges, Chairman, President and Chief Executive Officer stated, "Operationally we continued to make progress through our accelerated development drilling program that yielded a 96 percent success rate and the Hayworth exploration project (Ellender #1, net revenue interest 36.5 percent) that is now producing 13 Mmcfe per day (gross). We have also positioned the Company for future opportunities in the Gulf Coast with our success at the recent offshore lease sale and in Canada with the first quarter opening of our office in Calgary, Alberta." Dinges added, "In terms of our financial position, we were able to absorb the impairment and not adversely impact our balance sheet, which still has a debt to total capitalization ratio of 53 percent."
In response to the nuances of Regulation G and other SEC requirements, Cabot has posted on its website at www.cabotog.com in the investor relations section its latest financial guidance for the remaining three quarters of 2003. Additionally, the replay of the webcast will now be archived for one year.
Listen in live to Cabot Oil & Gas Corporation's first quarter earnings discussion with financial analysts on Wednesday, April 30 at 9:30 AM EDT (8:30 AM CDT) at www.cabotog.com . A teleconference replay will also be available at (888) 203-1112 (international (719) 457-0820), reservation number 405510. The audio webcast and teleconference replay will be available beginning April 30 at 12:30 PM EDT.
Cabot Oil & Gas Corporation, headquartered in Houston, Texas, is a leading domestic independent natural gas producer with substantial interests in the Gulf Coast, including Texas and Louisiana; the West, with the Rocky Mountains and Mid-Continent; and the East. 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 March 31, 2003 2002 NATURAL GAS (Bcf) & OIL (MBbl) Produced Natural Gas Gulf Coast 6.7 7.5 West 6.1 6.4 East 4.4 4.5 Total 17.2 18.4 Crude/Condensate Gulf Coast 696 610 West 48 50 East 6 8 Total 750 668 Natural Gas Liquids 29 15 Equivalent Production (Bcfe) 21.9 22.5 PRICES Average Produced Gas Sales Price ($/Mcf) Gulf Coast $4.88 $2.67 West $3.61 $2.14 East $5.35 $2.85 Total $4.55 $2.53 Crude/Condensate Price ($/Bbl) Gulf Coast $30.84 $20.57 West $32.05 $20.97 East $25.79 $16.41 Total $30.88 $20.55 WELLS DRILLED Gross 25 21 Net 18.5 12.3 Gross Success Rate 88% 95% CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited) (In Thousands, Except Per Share Amounts) Quarter Ended March 31, 2003 2002 Operating Revenues Natural Gas Production $78,173 $46,506 Brokered Natural Gas 31,850 13,698 Crude Oil and Condensate 23,174 13,718 Change in Derivative Fair Value (544) (616) Other 3,263 1,767 135,916 75,073 Operating Expenses Brokered Natural Gas Cost 28,261 12,267 Production and Pipeline Operations 10,926 12,235 Exploration 13,391 7,056 Taxes Other Than Income 10,224 6,152 Administrative 6,595 5,739 Depreciation, Depletion and Amortization 25,844 25,547 Impairment of Long-Lived Assets 87,926 1,063 183,167 70,059 Gain (Loss) on Sale of Assets 560 (18) Income (Loss) from Operations (46,691) 4,996 Interest Expense and Other 5,625 6,226 Loss Before Income Taxes (52,316) (1,230) Income Tax Benefit (19,940) (432) Net Loss Before Cumulative Effect of Accounting Change (32,376) (798) Cumulative Effect of Accounting Change (1) (6,847) --- Net Loss $(39,223) $(798) Net Loss Per Share - Basic $(1.23) $(0.03) Average Common Shares Outstanding 31,837 31,604 (1) Cumulative effect of accounting change relates to the adoption of SFAS 143, "Accounting for Asset Retirement Obligations." CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited) (In Thousands) March 31, Dec. 31, 2003 2002 Assets Current Assets $124,829 $93,121 Property, Equipment and Other Assets 888,997 978,767 Total Assets $1,013,826 $1,071,888 Liabilities and Stockholders' Equity Current Liabilities $159,695 $121,890 Long-Term Debt 338,000 365,000 Deferred Income Taxes 161,641 200,207 Other Liabilities 55,452 34,134 Stockholders' Equity 299,038 350,657 Total Liabilities and Stockholders' Equity $1,013,826 $1,071,888 CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited) (In Thousands) Quarter Ended March 31, 2003 2002 Cash Flows From Operating Activities Net Loss $(39,223) $(798) Cumulative Effect of Accounting Change 6,847 --- Change in Derivative Fair Value 544 616 Impairment of Long-Lived Assets 87,926 1,063 Income Charges Not Requiring Cash 25,705 26,911 (Gain) Loss on Sale of Assets (560) 18 Deferred Income Taxes (27,010) (471) Changes in Assets and Liabilities (8,073) (4,846) Exploration Expense 13,391 7,056 Net Cash Provided by Operations 59,547 29,549 Cash Flows From Investing Activities Capital Expenditures (21,321) (41,062) Proceeds from Sale of Assets 1,602 (2) Exploration Expense (13,391) (7,056) Net Cash Used by Investing (33,110) (48,120) Cash Flows From Financing Activities Sale of Common Stock 498 105 Increase (Decrease) in Debt (27,000) 19,000 Common Dividends and Other (1,273) (1,264) Net Cash Provided (Used) by Financing (27,775) 17,841 Net Decrease in Cash and Cash Equivalents $(1,338) $(730) Selected Item Review and Reconciliation of Net Income (Loss) and Earnings (Loss) Per Share (In Thousands, Except Per Share Amounts) Quarter Ended March 31, 2003 2002 As Reported - Net Loss $(39,223) $(798) Reversal of Selected Items, Net of Tax: Impairment of Long-Lived Assets 54,426 657 Cumulative Effect of Accounting Change 6,847 --- Net Income Including Reversal of Selected Items $22,050 $(141) As Reported - Net Loss Per Share $(1.23) $(0.03) Per Share Impact of Reversing Selected Items 1.92 0.02 Net Income (Loss) Per Share Including Reversal of Selected Items $0.69 $(0.01) Average Common Shares Outstanding 31,837 31,604 Discretionary Cash Flow Calculation and Reconciliation (In Thousands) Quarter Ended March 31, 2003 2002 Discretionary Cash Flow As Reported - Net Loss $(39,223) $(798) Plus: Cumulative Effect of Accounting Change 6,847 --- Change in Derivative Fair Value 544 616 Impairment of Long-Lived Assets 87,926 1,063 Income Charges Not Requiring Cash 25,705 26,911 (Gain) Loss on Sale of Assets (560) 18 Deferred Income Taxes (27,010) (471) Exploration Expense 13,391 7,056 Discretionary Cash Flow 67,620 34,395 Plus: Changes in Assets and Liabilities (8,073) (4,846) Net Cash Provided by Operations $59,547 $29,549
SOURCE Cabot Oil & Gas Corporation