Cimarex Energy Co. (XEC, Financial) filed Quarterly Report for the period ended 2009-03-31.
Cimarex Energy is an independent oil and gas exploration and production company focused on increasing shareholder value through strategies linked to generating attractive economic returns on capital employed and profitable growth in per-share reserves production and cash flow. They intend to profitably grow reserves and production through a balanced mix of exploration exploitation and acquisitions. They have a diversified base of high-quality production along with attractive drilling opportunities. Cimarex Energy Co. has a market cap of $2.45 billion; its shares were traded at around $29.39 with a P/E ratio of 4.2 and P/S ratio of 1.3. The dividend yield of Cimarex Energy Co. stocks is 0.9%. Cimarex Energy Co. had an annual average earning growth of 18.6% over the past 5 years.
We recognized a net loss for the first quarter of 2009 of $494.1 million, or $6.05 per share. This compares to net income of $149.5 million, or $1.73 per diluted share for the same period in 2008. The net loss is primarily the result of a non-cash full cost ceiling write-down recorded in the first quarter of 2009. The full cost ceiling impairment is discussed further in the operating costs and expenses section below.
Oil and gas sales for the first quarter of 2009 totaled $197.2 million, compared to $454.4 million in 2008. The decrease of $257.2 million in sales between the two periods was the result of lower commodity prices which had a negative impact of $271.1 million. These lower prices were slightly offset by an increase in sales of $13.9 million due to higher production volumes during the current quarter.
Average realized gas prices decreased by 54% to $3.83 per Mcf for the three months ended March 31, 2009, compared to $8.38 per Mcf for the first quarter of 2008. This price decrease lowered gas sales by $138.6 million between the two periods. Included in our 2008 realized gas price is $1.0 million of cash receipts (a positive $0.03 per Mcf effect) from settlement of cash flow hedges on 40,000 MMBtu per day of Mid-Continent gas production.
DD&A decreased from $125.6 million in the first quarter of 2008 to $89.7 million in the same period of 2009. On a unit of production basis, DD&A was $2.04 per Mcfe in 2009 compared to $2.90 per Mcfe for 2008. The significant decrease in DD&A is due to the $2.2 billion reduction to the carrying value of oil and gas properties recorded during the last half of 2008. With the recording of an additional impairment in the first quarter of 2009 we expect the DD&A rate to be lower in the second quarter of 2009 in comparison to the first quarter of the current year.
Production costs decreased $1.6 million from $52.0 million ($1.20 per Mcfe) in the first quarter of 2008 to $50.4 million ($1.15 per Mcfe) in the first quarter of 2009. A component of the decrease between
Read the The complete ReportXEC is in the portfolios of Third Avenue Management, Robert Rodriguez of FPA Capital, Martin Whitman of Third Avenue Value Fund, Robert Rodriguez of FPA Capital, Kenneth Fisher of Fisher Asset Management, LLC, Kenneth Fisher of Fisher Asset Management, LLC, David Dreman of Dreman Value Management, David Dreman of Dreman Value Management, John Keeley of Keeley Fund Management.
Cimarex Energy is an independent oil and gas exploration and production company focused on increasing shareholder value through strategies linked to generating attractive economic returns on capital employed and profitable growth in per-share reserves production and cash flow. They intend to profitably grow reserves and production through a balanced mix of exploration exploitation and acquisitions. They have a diversified base of high-quality production along with attractive drilling opportunities. Cimarex Energy Co. has a market cap of $2.45 billion; its shares were traded at around $29.39 with a P/E ratio of 4.2 and P/S ratio of 1.3. The dividend yield of Cimarex Energy Co. stocks is 0.9%. Cimarex Energy Co. had an annual average earning growth of 18.6% over the past 5 years.
Highlight of Business Operations:
To supplement our growth and to provide for new drilling opportunities, we also consider mergers and acquisitions. In 2005 we acquired Magnum Hunter Resources, Inc, in a stock-for-stock merger with a total transaction value of approximately $2.1 billion. Magnum Hunter was a Dallas-based independent oil and gas exploration and production company with operations concentrated in the Permian Basin of West Texas and New Mexico and in the Gulf of Mexico. During 2007 we purchased $40.9 million of assets, with the largest acquisition being in the Texas Panhandle area. In October 2008 we acquired 38,000 net acres in our western Oklahoma, Anadarko Basin Woodford shale play, at a total cost of $180.9 million. We have increased our position in the play to approximately 98,000 net acres. In first quarter 2009 we had $0.1 million of asset purchases.We recognized a net loss for the first quarter of 2009 of $494.1 million, or $6.05 per share. This compares to net income of $149.5 million, or $1.73 per diluted share for the same period in 2008. The net loss is primarily the result of a non-cash full cost ceiling write-down recorded in the first quarter of 2009. The full cost ceiling impairment is discussed further in the operating costs and expenses section below.
Oil and gas sales for the first quarter of 2009 totaled $197.2 million, compared to $454.4 million in 2008. The decrease of $257.2 million in sales between the two periods was the result of lower commodity prices which had a negative impact of $271.1 million. These lower prices were slightly offset by an increase in sales of $13.9 million due to higher production volumes during the current quarter.
Average realized gas prices decreased by 54% to $3.83 per Mcf for the three months ended March 31, 2009, compared to $8.38 per Mcf for the first quarter of 2008. This price decrease lowered gas sales by $138.6 million between the two periods. Included in our 2008 realized gas price is $1.0 million of cash receipts (a positive $0.03 per Mcf effect) from settlement of cash flow hedges on 40,000 MMBtu per day of Mid-Continent gas production.
DD&A decreased from $125.6 million in the first quarter of 2008 to $89.7 million in the same period of 2009. On a unit of production basis, DD&A was $2.04 per Mcfe in 2009 compared to $2.90 per Mcfe for 2008. The significant decrease in DD&A is due to the $2.2 billion reduction to the carrying value of oil and gas properties recorded during the last half of 2008. With the recording of an additional impairment in the first quarter of 2009 we expect the DD&A rate to be lower in the second quarter of 2009 in comparison to the first quarter of the current year.
Production costs decreased $1.6 million from $52.0 million ($1.20 per Mcfe) in the first quarter of 2008 to $50.4 million ($1.15 per Mcfe) in the first quarter of 2009. A component of the decrease between
Read the The complete ReportXEC is in the portfolios of Third Avenue Management, Robert Rodriguez of FPA Capital, Martin Whitman of Third Avenue Value Fund, Robert Rodriguez of FPA Capital, Kenneth Fisher of Fisher Asset Management, LLC, Kenneth Fisher of Fisher Asset Management, LLC, David Dreman of Dreman Value Management, David Dreman of Dreman Value Management, John Keeley of Keeley Fund Management.
