New Threads Only:  Add to Google Reader or Homepage
New Threads & Replies:  Add to Google Reader or Homepage
Forums are for serious investors only. GuruFocus Forum Rules.

Forum List » Business News and Headlines
SEC Filings, Earing Reports, Press Releases
New Topic Search
Goto Thread: PreviousNext
Goto: Forum ListMessage ListNew TopicSearchLog In
Callon Petroleum Company Reports Results of Operations For Second Quarter, First Six Months of 2009
Posted by: gurufocus (IP Logged)
Date: August 6, 2009 06:31PM

Press Release: Callon Petroleum Company Reports Results of Operations For Second Quarter, First Six Months of 2009

NATCHEZ, Miss.--(BUSINESS WIRE)--Callon Petroleum Company (NYSE: CPE) today reported results of operations for both the three and the six-month periods ended June 30, 2009.

Second Quarter and Six Months 2009 Net Income. For the quarter ended June 30, 2009, the company reported a net loss of $0.9 million, or $0.04 per share, after a non-recurring charge of $2.2 million associated with staffing reductions and employee retirements, which reduced earnings per share by $0.10. Net income for the comparable period of 2008 was $5.2 million, or $0.23 per share. For the six months ended June 30, 2009, Callon reported net income of $1.5 million, or $0.07 per share. This compares with net income of $12.8 million, or $0.58 per share during the same period of 2008. All per share amounts are on a diluted basis.

Second Quarter and Six Months 2009 Operating Results. Operating results for the three months ended June 30, 2009 include oil and gas sales of $25.0 million from average production of 33.1 million cubic feet of natural gas equivalent per day (MMcfe/d) which exceeded the high-end of the company’s published guidance range of 28.0 to 30.0 MMcfe/d. This corresponds to sales of $48.0 million from average production of 37.2 MMcfe/d during the comparable 2008 period. The average price received, after the impact of hedging, per thousand cubic feet of natural gas (Mcf) for the quarter ended June 30, 2009 decreased to $4.22, compared to $11.67 for the quarter ended June 30, 2008. The average price received, after the impact of hedging, per barrel of oil (Bbl) in the second quarter of 2009 decreased to $72.22, compared to $99.99 during the second quarter of 2008. Oil and gas sales for the first six months of 2009 totaled $49.8 million from average production of 33.3 MMcfe/d. This corresponds to sales of $93.0 million from average production of 39.6 MMcfe/d during the same period in 2008. The average price, after the impact of hedging, received per Mcf in the six-month period of 2009 decreased to $5.18, compared to $10.46 during the first six months of 2008, while the average price received, after the impact of hedging, per Bbl in the first half of 2009 decreased to $66.39, compared to $93.27 during the same period in 2008.

Second Quarter and Six Months 2009 Discretionary Cash Flow. Discretionary cash flow for the three-month period ended June 30, 2009 totaled $11.4 million compared to $30.2 million during the comparable prior year period. As defined by U.S. generally accepted accounting principles (GAAP), net cash flow used in operating activities totaled $0.2 million during the quarter ended June 30, 2009 and net cash flow provided by operating activities totaled $28.8 million during the quarter ended June 30, 2008. Discretionary cash flow for the first six months of 2009 totaled $25.6 million compared to $59.3 million during the same period in 2008. Net cash flow provided by operating activities, as defined by GAAP, totaled $2.1 million and $63.9 million during the six-month periods ended June 30, 2009 and 2008, respectively. (See “Non-GAAP Financial Measure” that follows and the accompanying reconciliation of discretionary cash flow, a non-GAAP measure, to net cash flow provided by operating activities.)

Non-GAAP Financial Measure - This news release refers to a non-GAAP financial measure as “discretionary cash flow.” Callon believes that the non-GAAP measure of discretionary cash flow is useful as an indicator of an oil and gas exploration and production company’s ability to internally fund exploration and development activities and to service or incur additional debt. The company also has included this information because changes in operating assets and liabilities relate to the timing of cash receipts and disbursements which the company may not control and may not relate to the period in which the operating activities occurred. Discretionary cash flow should not be considered an alternative to net cash provided by operating activities or net income as defined by GAAP.

       
 

Reconciliation of Non-GAAP Financial Measure:

Three Months Ended Six Months Ended
(In thousands) June 30, June 30,

2009

2008

2009

2008

Discretionary cash flow $ 11,384

$

30,245

$ 25,614 $ 59,288
Net working capital changes and other changes   (11,577 )  

(1,467

)

  (23,561 )   4,621
Net cash flow (used in) provided by operating activities $ (193 )

$

28,778

  $ 2,053   $ 63,909
   
 

Production and Price Information:

Three Months Ended

Six Months Ended

June 30, June 30,
2009   2008 2009   2008
Production:
Oil (MBbls) 263 286 526 575
Gas (MMcf) 1,433 1,668 2,880 3,759
Gas equivalent (MMcfe) 3,010 3,382 6,036 7,211
Average daily (MMcfe) 33.1 37.2 33.3 39.6
 
Average prices:
Oil ($/Bbl) (a) $ 72.22 $ 99.99 $ 66.39 $ 93.27
Gas ($/Mcf) $ 4.22 $ 11.67 $ 5.18 $ 10.46
Gas equivalent ($/Mcfe) $ 8.32 $ 14.20 $ 8.26 $ 12.90
 
Additional per Mcfe data:
Sales price $ 8.32 $ 14.20 $ 8.26 $ 12.90
Lease operating expenses   1.55     1.44     1.44   $ 1.39  
Operating margin $ 6.77   $ 12.76   $ 6.82   $ 11.51  
 
Depletion $ 2.81 $ 4.50 $ 2.96 $ 4.19
General and administrative (net of management fees) $ 1.79 $ 0.87 $ 1.19 $ 0.78
 

(a) Below is a reconciliation of the average NYMEX price to the average realized sales price per barrel of oil:

 
Average NYMEX oil price $ 59.62 $ 123.98 $ 51.35 $ 110.94
Basis differentials and quality adjustments ( 3.30 ) ( 4.06 ) ( 3.68 ) ( 3.95 )
Transportation ( 1.36 ) ( 1.34 ) ( 1.35 ) ( 1.30 )
Hedging   17.26     ( 18.59 )   20.07     ( 12.42 )
Averaged realized oil price $ 72.22   $ 99.99   $ 66.39   $ 93.27  

 
 
 

Callon Petroleum Company

Consolidated Balance Sheets

(In thousands, except share data)

 
  June 30,   December 31,
2009 2008
ASSETS (Unaudited)
Current assets:
Cash and cash equivalents $ 735 $ 17,126
Accounts receivable 19,528 44,290
Fair market value of derivatives 7,064 21,780
Other current assets   1,971   1,103
Total current assets   29,298   84,299
 
Oil and gas properties, full-cost accounting method:
Evaluated properties 1,587,007 1,581,698
Less accumulated depreciation, depletion and amortization   (1,473,139 )   (1,455,275 )
113,868 126,423
 
Unevaluated properties excluded from amortization   26,147   32,829
Total oil and gas properties   140,015   159,252
 
Other property and equipment, net 2,392 2,536
Restricted investments 4,784 4,759
Investment in Medusa Spar LLC 11,926 12,577
Other assets, net   2,327   2,667
Total assets $ 190,742 $ 266,090
 
LIABILITIES AND STOCKHOLDERS\' EQUITY (DEFICIT)
Current liabilities:
Accounts payable and accrued liabilities $ 11,379 $ 76,516
Asset retirement obligations   22,374   9,151
33,753 85,667
Callon Entrada non-recourse credit facility   82,841   --
Total current liabilities   116,594   85,667
 
9.75% Senior Notes 195,729 194,420
Callon Entrada non-recourse credit facility -- 78,435
Senior secured credit facility   5,000   --
Total long-term debt   200,729   272,855
 
Asset retirement obligations 12,631 33,043
Callon Entrada non-recourse credit facility interest payable -- 2,719
Other long-term liabilities   1,503   1,610
Total liabilities   331,457   395,894
 
Stockholders\' equity (deficit):
Preferred Stock, $.01 par value, 2,500,000 shares authorized; -- --

Common Stock, $.01 par value, 30,000,000 shares authorized; 21,676,067 and 21,621,142 shares outstanding at June 30, 2009 and December 31, 2008, respectively

217 216
Capital in excess of par value 230,150 227,803
Other comprehensive income (loss) (581 ) 14,157
Retained (deficit) earnings   (370,501 )   (371,980 )
Total stockholders\' equity (deficit)   (140,715 )   (129,804 )
Total liabilities and stockholders\' equity (deficit) $ 190,742 $ 266,090

 
 
 

Callon Petroleum Company

Consolidated Statements of Operations

(In thousands, except per share amounts)

(Unaudited)

 
  Three Months Ended  

Six Months Ended

June 30, June 30,
2009   2008 2009   2008
Operating revenues:
Oil sales $ 18,971 $ 28,554 $ 34,923 $ 53,650
Gas sales   6,054     19,475  

Stocks Discussed: CPE,
Rate this post:




Sorry, only registered users may post in this forum.

Please Login if you have an account or Create a Free Account if you don't




Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial