Rosetta Resources Inc. (ROSE, Financial) filed Quarterly Report for the period ended 2012-06-30.
Rosetta Resources Inc. has a market cap of $2.12 billion; its shares were traded at around $42.34 with a P/E ratio of 16.9 and P/S ratio of 4.8.
As of June 30, 2012, the Company had $90.0 million outstanding with $535.0 million of available borrowing capacity under its Restated Revolver. Amounts outstanding under the Restated Revolver bear interest at specified margins over the London Interbank Offered Rate (LIBOR) of 1.50% to 2.50%. The weighted average borrowing rate for the six months ended June 30, 2012 under the Restated Revolver was 1.93%. Borrowings under the Restated Revolver are collateralized by perfected first priority liens and security interests on substantially all of the Companys assets, including a mortgage lien on oil and natural gas properties having at least 80% of the pre-tax SEC PV-10 reserve value, a guaranty by all of the Companys domestic subsidiaries and a pledge of 100% of the membership and limited partnership interests of the Companys domestic subsidiaries. Collateralized amounts under the mortgages are subject to semi-annual reviews based on updated reserve information. The Company is subject to certain financial covenants such as the requirement to maintain a minimum current ratio of consolidated current assets, including the unused amount of available borrowing capacity, to consolidated current liabilities, excluding certain non-cash obligations, of not less than 1.0 to 1.0 as of the end of each fiscal quarter. The terms of the credit agreement also require the maintenance of a maximum leverage ratio of total debt to earnings before interest expense, income taxes and noncash items, such as depreciation, depletion, amortization and impairment, of not greater than 4.0 to 1.0, calculated at the end of each fiscal quarter for the four fiscal quarters then ended, measured quarterly after giving pro forma effect to acquisitions and divestitures. As of June 30, 2012, the Companys current ratio was 4.1 and the leverage ratio was 0.6. In addition, the Company is subject to covenants limiting dividends and other restricted payments, transactions with affiliates, incurrence of debt, changes of control, asset sales and liens on properties.
Oil. For the three and six months ended June 30, 2012, oil revenue, including realized derivative losses, increased by $26.0 million and $60.1 million, respectively, from the same periods in 2011. The increases were attributable to increased production from newly completed wells in the Eagle Ford shale. Realized derivative losses of $1.1 million and $1.3 million, respectively, for the three and six months ended June 30, 2012 are reported as a component of Derivative instruments within Revenues. For the three and six months ended June 30, 2011, the effects of oil hedging activities on oil revenue resulted in losses of $1.1 million and $1.5 million, respectively, and are reported as a component of Oil sales within Revenues.
Natural Gas. For the three and six months ended June 30, 2012, natural gas revenues, including realized derivative gains, decreased by $25.0 million and $46.6 million, respectively, from the same periods in 2011. The decreases were primarily due to a decline in average realized price of natural gas, including the effects of realized derivative gains, and a 5% decline in natural gas production due to asset divestitures of dry gas properties for both the three and six months ended June 30, 2012, compared to the same periods in 2011. Realized derivative gains of $5.4 million and $9.9 million, respectively, for the three and six months ended June 30, 2012 are reported as a component of Derivative instruments within Revenues. For the three and six months ended June 30, 2011, the effects of natural gas hedging activities on natural gas revenues resulted in gains of $11.2 million and $21.4 million, respectively, and are reported as a component of Natural gas sales within Revenues.
During the six months ended June 30, 2012, we repaid $70.0 million on the Restated Revolver. As of June 30, 2012, we had $90.0 million outstanding with $535.0 million of available borrowing capacity under the Restated Revolver. Amounts outstanding under the Restated Revolver bear interest at specified margins over the London Interbank Offered Rate (LIBOR) of 1.50% to 2.50%. Borrowings under the Restated Revolver are collateralized by perfected first priority liens and security interests on substantially all of our assets, including a mortgage lien on oil and natural gas properties having at least 80% of the pre-tax SEC PV-10 reserve value, a guaranty by all of our domestic subsidiaries and a pledge of 100% of the membership and limited partnership interests of our domestic subsidiaries. Collateralized amounts under the mortgages are subject to semi-annual reviews based on updated reserve information. We are subject to certain financial covenants such as the requirement to maintain a minimum current ratio of consolidated current assets, including the unused amount of available borrowing capacity, to consolidated current liabilities, excluding certain non-cash obligations, of not less than 1.0 to 1.0 as of the end of each fiscal quarter. The terms of the credit agreement also require the maintenance of a maximum leverage ratio of total debt to earnings before interest expense, income taxes and noncash items, such as depreciation, depletion, amortization and impairment, of not greater than 4.0 to 1.0, calculated at the end of each fiscal quarter for the four fiscal quarters then ended, measured quarterly after giving pro forma effect to acquisitions and divestitures. As of June 30, 2012, our current ratio was 4.1 and our leverage ratio was 0.6. In addition, we are subject to covenants limiting dividends and other restricted payments, transactions with affiliates, incurrence of debt, changes of control, asset sales and liens on properties. We were in compliance with all covenants as of June 30, 2012.
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Rosetta Resources Inc. has a market cap of $2.12 billion; its shares were traded at around $42.34 with a P/E ratio of 16.9 and P/S ratio of 4.8.
Highlight of Business Operations:
Effective January 1, 2012, the Company elected to de-designate all commodity contracts that were previously designated as cash flow hedges as of December 31, 2011, and elected to discontinue hedge accounting prospectively. Accumulated other comprehensive income included $2.6 million ($1.6 million after tax) of unrealized net gains, representing the marked-to-market value of the Companys cash flow hedges as of December 31, 2011. As a result of discontinuing hedge accounting, the marked-to-market values included in Accumulated other comprehensive income as of the de-designation date were frozen and will be reclassified into earnings in future periods as the underlying hedged transactions affect earnings. During the three and six months ended June 30, 2012, the Company reclassified unrealized net gains of $1.1 million ($0.7 million after tax) and $1.2 million ($0.8 million after tax), respectively, into earnings from Accumulated other comprehensive income. The Company expects to reclassify an additional $1.5 million ($0.9 million after tax) of unrealized net gains during the last six months of 2012 and $0.1 million of unrealized net losses during 2013 into earnings from Accumulated other comprehensive income.As of June 30, 2012, the Company had $90.0 million outstanding with $535.0 million of available borrowing capacity under its Restated Revolver. Amounts outstanding under the Restated Revolver bear interest at specified margins over the London Interbank Offered Rate (LIBOR) of 1.50% to 2.50%. The weighted average borrowing rate for the six months ended June 30, 2012 under the Restated Revolver was 1.93%. Borrowings under the Restated Revolver are collateralized by perfected first priority liens and security interests on substantially all of the Companys assets, including a mortgage lien on oil and natural gas properties having at least 80% of the pre-tax SEC PV-10 reserve value, a guaranty by all of the Companys domestic subsidiaries and a pledge of 100% of the membership and limited partnership interests of the Companys domestic subsidiaries. Collateralized amounts under the mortgages are subject to semi-annual reviews based on updated reserve information. The Company is subject to certain financial covenants such as the requirement to maintain a minimum current ratio of consolidated current assets, including the unused amount of available borrowing capacity, to consolidated current liabilities, excluding certain non-cash obligations, of not less than 1.0 to 1.0 as of the end of each fiscal quarter. The terms of the credit agreement also require the maintenance of a maximum leverage ratio of total debt to earnings before interest expense, income taxes and noncash items, such as depreciation, depletion, amortization and impairment, of not greater than 4.0 to 1.0, calculated at the end of each fiscal quarter for the four fiscal quarters then ended, measured quarterly after giving pro forma effect to acquisitions and divestitures. As of June 30, 2012, the Companys current ratio was 4.1 and the leverage ratio was 0.6. In addition, the Company is subject to covenants limiting dividends and other restricted payments, transactions with affiliates, incurrence of debt, changes of control, asset sales and liens on properties.
Oil. For the three and six months ended June 30, 2012, oil revenue, including realized derivative losses, increased by $26.0 million and $60.1 million, respectively, from the same periods in 2011. The increases were attributable to increased production from newly completed wells in the Eagle Ford shale. Realized derivative losses of $1.1 million and $1.3 million, respectively, for the three and six months ended June 30, 2012 are reported as a component of Derivative instruments within Revenues. For the three and six months ended June 30, 2011, the effects of oil hedging activities on oil revenue resulted in losses of $1.1 million and $1.5 million, respectively, and are reported as a component of Oil sales within Revenues.
Natural Gas. For the three and six months ended June 30, 2012, natural gas revenues, including realized derivative gains, decreased by $25.0 million and $46.6 million, respectively, from the same periods in 2011. The decreases were primarily due to a decline in average realized price of natural gas, including the effects of realized derivative gains, and a 5% decline in natural gas production due to asset divestitures of dry gas properties for both the three and six months ended June 30, 2012, compared to the same periods in 2011. Realized derivative gains of $5.4 million and $9.9 million, respectively, for the three and six months ended June 30, 2012 are reported as a component of Derivative instruments within Revenues. For the three and six months ended June 30, 2011, the effects of natural gas hedging activities on natural gas revenues resulted in gains of $11.2 million and $21.4 million, respectively, and are reported as a component of Natural gas sales within Revenues.
During the six months ended June 30, 2012, we repaid $70.0 million on the Restated Revolver. As of June 30, 2012, we had $90.0 million outstanding with $535.0 million of available borrowing capacity under the Restated Revolver. Amounts outstanding under the Restated Revolver bear interest at specified margins over the London Interbank Offered Rate (LIBOR) of 1.50% to 2.50%. Borrowings under the Restated Revolver are collateralized by perfected first priority liens and security interests on substantially all of our assets, including a mortgage lien on oil and natural gas properties having at least 80% of the pre-tax SEC PV-10 reserve value, a guaranty by all of our domestic subsidiaries and a pledge of 100% of the membership and limited partnership interests of our domestic subsidiaries. Collateralized amounts under the mortgages are subject to semi-annual reviews based on updated reserve information. We are subject to certain financial covenants such as the requirement to maintain a minimum current ratio of consolidated current assets, including the unused amount of available borrowing capacity, to consolidated current liabilities, excluding certain non-cash obligations, of not less than 1.0 to 1.0 as of the end of each fiscal quarter. The terms of the credit agreement also require the maintenance of a maximum leverage ratio of total debt to earnings before interest expense, income taxes and noncash items, such as depreciation, depletion, amortization and impairment, of not greater than 4.0 to 1.0, calculated at the end of each fiscal quarter for the four fiscal quarters then ended, measured quarterly after giving pro forma effect to acquisitions and divestitures. As of June 30, 2012, our current ratio was 4.1 and our leverage ratio was 0.6. In addition, we are subject to covenants limiting dividends and other restricted payments, transactions with affiliates, incurrence of debt, changes of control, asset sales and liens on properties. We were in compliance with all covenants as of June 30, 2012.
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