Ultra Petroleum Corp Reports Operating Results (10-K)
Ultra Petroleum Corp. has a market cap of $6.72 billion; its shares were traded at around $44.1 with a P/E ratio of 20.1 and P/S ratio of 10.1. Hedge Fund Gurus that owns UPL: Private Capital of Private Capital Management, Bruce Kovner of Caxton Associates, Jim Simons of Renaissance Technologies LLC, Steven Cohen of SAC Capital Advisors. Mutual Fund and Other Gurus that owns UPL: Richard Aster Jr of Meridian Fund, Columbia Wanger of Columbia Wanger Asset Management, Ron Baron of Baron Funds, Ruane Cunniff of Ruane & Cunniff & Goldfarb Inc, Mario Gabelli of GAMCO Investors.
Highlight of Business Operations: The aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant was $6,747,137,694 as of June 30, 2010 (based on the last reported sales price of $44.25 of such stock on the New York Stock Exchange on such date).
Low Cost Producer. Ultra strives to maintain one of the lowest cost structures in the industry in terms of both adding and producing oil and natural gas reserves. The Company continues to focus on improving its drilling and production results through the use of advanced technologies and detailed technical analysis of its properties. For the year ended 2010, the Companys all-in costs were $2.68 per Mcfe with finding and development costs of $1.48 per Mcfe.
Financial Flexibility. Preserving financial flexibility and a strong balance sheet are also strategic to Ultras business philosophy. At December 31, 2010, the Company had cash on hand of $70.8 million and outstanding debt was $1.6 billion. Consistent with this strategy, during 2010 the Company issued approximately $1.025 billion of senior notes at an average interest rate of 5.05% and a weighted average term of 10.6 years. As a result of the issuance, the availability under the Companys revolving credit facility increased to $500.0 million and the average debt maturity profile lengthened to over nine years due to adding tranches of 12 and 15 year debt while the Companys weighted average cost of debt remains at approximately 5.6%.
During 2010, the Company participated in the drilling of 217 wells in Wyoming and continued to improve its drilling and completion efficiency on its operated wells as measured by spud to total depth. During 2010, the average drilling days decreased 30% from 2009 levels to 14 days from spud to total depth. In addition, the Companys average well cost decreased from $5.0 million per well during 2009 to $4.7 million during 2010. This 6% reduction in costs is a direct result of fewer drilling days, fewer rig moves associated with pad drilling and lower cost of services. These cost reductions were accomplished while simultaneously drilling deeper wells and completing more frac stages per well.
During 2010, a wholly-owned subsidiary of the Company acquired, for $403.8 million in cash, non-producing mineral acres and a small number of producing gas wells in the Pennsylvania Marcellus Shale. Additionally, the Company purchased additional undeveloped acreage in the Marcellus Shale for approximately $63.4 million during 2010.
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