Questar Corp. (STR, Financial) filed Quarterly Report for the period ended 2009-06-30.
Questar Corporation is a natural gas-focused energy company with five major lines of business - gas and oil exploration and production midstream field services energy marketing interstate gas transportation and retail gas distribution. These services are conducted through its three principal subsidiaries: Questar Market Resources (a subholding company that operates through four principal subsidiaries) Questar Pipeline Company (provides interstate natural gas transportation and storage and other energy services) and Questar Gas Company (provides retail natural gas distribution services in Utah Wyoming and Idaho). Questar Corp. has a market cap of $5.94 billion; its shares were traded at around $34.1 with a P/E ratio of 10.2 and P/S ratio of 1.7. The dividend yield of Questar Corp. stocks is 1.5%. Questar Corp. had an annual average earning growth of 15% over the past 10 years. GuruFocus rated Questar Corp. the business predictability rank of 3.5-star.
Questar E&P hedged approximately 80% of 2009 and 83% of 2008 first half gas production. Hedging increased Questar E&P 2009 gas revenues by $303.1 million and reduced 2008 gas revenues by $37.1 million. Approximately 30% of 2009 and 53% of 2008 Questar E&P oil production was hedged. Oil hedges increased revenues $5.9 million in 2009 and decreased revenues $23.1 million in 2008.
Wexpro reported net income of $19.8 million in the second quarter of 2009 compared to $18.8 million in 2008, a 5% increase and first half net income of $38.6 million in 2009 compared to $35.0 million in 2008, up 10%. Wexpro 2009 results benefited from a higher average investment base compared to the prior-year period. Pursuant to the Wexpro Agreement, Wexpro recovers its costs and receives an unlevered after-tax return of approximately 19-20% on its investment base. Wexpro\'s investment base is its investment in commercial wells and related facilities adjusted for working capital and reduced for deferred income taxes and depreciation. Wexpro investment base at June 30, 2009, was $411.4 million compared to $346.4 million a year ago, a 19% increase.
Total processing margins (revenues minus direct plant expenses and processing plant-shrink) for the second quarter of 2009 decreased 35% to $14.0 million compared to $21.7 million in 2008 and declined 41% to $23.3 million in the first half of 2009 compared to $39.5 million in the 2008 period. The keep-whole processing margin (frac-spread) decreased 42% or $7.1 million in the second quarter of 2009 compared to the 2008 quarter and 54% in the first half of 2009 compared to the first half of 2008. Fee-based gas-processing volumes decreased 3% in the second quarter of 2009 to 42.1 million MMBtu and increased 1% to 94.6 million MMBtu in the first half of 2009 compared to 93.4 million MMBtu in the 2008 period. Fee-based gas-processing revenues increased $0.4 million or 6% compared to the year ago quarter and $1.6 million or 12% in the first half of 2009 compared to the first half of 2008. Approximately 82% of Gas Management net operating revenue (total revenue less processing plant-shrink) was derived from fee-based contracts compared to 72% in the 2008 quarter.
Energy Trading net income was $0.8 million in the second quarter of 2009, a decrease of 83% compared to $4.8 million in the 2008 quarter and decreased $6.7 million in the first half of 2009 compared to 2008 as a result of lower marketing margins. First half revenues from unaffiliated customers were $191.6 million in 2009 compared to $387.4 million in 2008, a 51% decrease, primarily the result of lower natural gas prices. The weighted-average natural gas sales price decreased 59% in the first half of 2009 to $3.18 per MMBtu compared to $7.74 per MMBtu in the 2008 period.
Questar Pipeline, which provides interstate natural gas-transportation and storage services, reported second quarter 2009 net income of $15.0 million compared with $12.7 million in 2008, an 18% increase. Net income for the first half of 2009 was $29.7 million compared with $28.6 for the first half of 2008. The second quarter of 2008 included one-time items that reduced net income by $2.1 million. Following is a summary of Questar Pipeline financial and operating results:
Read the The complete ReportSTR is in the portfolios of T Boone Pickens of BP Capital, Irving Kahn of Kahn Brothers & Company Inc., John Keeley of Keeley Fund Management.
Questar Corporation is a natural gas-focused energy company with five major lines of business - gas and oil exploration and production midstream field services energy marketing interstate gas transportation and retail gas distribution. These services are conducted through its three principal subsidiaries: Questar Market Resources (a subholding company that operates through four principal subsidiaries) Questar Pipeline Company (provides interstate natural gas transportation and storage and other energy services) and Questar Gas Company (provides retail natural gas distribution services in Utah Wyoming and Idaho). Questar Corp. has a market cap of $5.94 billion; its shares were traded at around $34.1 with a P/E ratio of 10.2 and P/S ratio of 1.7. The dividend yield of Questar Corp. stocks is 1.5%. Questar Corp. had an annual average earning growth of 15% over the past 10 years. GuruFocus rated Questar Corp. the business predictability rank of 3.5-star.
Highlight of Business Operations:
Questar E&P reported net income of $29.6 million in the second quarter of 2009, down 75% from $116.8 million in the 2008 quarter. Net income for the quarter fell primarily as the result of a 20% lower realized equivalent price, a 15% increase in per Mcfe production costs and net mark-to-market losses on natural gas basis-only swaps. Net income for the first half of 2009 declined 93% to $14.7 million compared to $213.3 million a year earlier. The company reported production of 43.4 Bcfe in the second quarter of 2009 compared to 40.6 Bcfe in the 2008 quarter, a 7% increase. Mark-to-market losses on natural gas basis-only swaps decreased second quarter 2009 net income $17.5 million, compared to a $10.1 million after-tax gain in the 2008 period and decreased first half 2009 net income $102.2 million compared to an $18.6 million after-tax gain in the 2008 period.Questar E&P hedged approximately 80% of 2009 and 83% of 2008 first half gas production. Hedging increased Questar E&P 2009 gas revenues by $303.1 million and reduced 2008 gas revenues by $37.1 million. Approximately 30% of 2009 and 53% of 2008 Questar E&P oil production was hedged. Oil hedges increased revenues $5.9 million in 2009 and decreased revenues $23.1 million in 2008.
Wexpro reported net income of $19.8 million in the second quarter of 2009 compared to $18.8 million in 2008, a 5% increase and first half net income of $38.6 million in 2009 compared to $35.0 million in 2008, up 10%. Wexpro 2009 results benefited from a higher average investment base compared to the prior-year period. Pursuant to the Wexpro Agreement, Wexpro recovers its costs and receives an unlevered after-tax return of approximately 19-20% on its investment base. Wexpro\'s investment base is its investment in commercial wells and related facilities adjusted for working capital and reduced for deferred income taxes and depreciation. Wexpro investment base at June 30, 2009, was $411.4 million compared to $346.4 million a year ago, a 19% increase.
Total processing margins (revenues minus direct plant expenses and processing plant-shrink) for the second quarter of 2009 decreased 35% to $14.0 million compared to $21.7 million in 2008 and declined 41% to $23.3 million in the first half of 2009 compared to $39.5 million in the 2008 period. The keep-whole processing margin (frac-spread) decreased 42% or $7.1 million in the second quarter of 2009 compared to the 2008 quarter and 54% in the first half of 2009 compared to the first half of 2008. Fee-based gas-processing volumes decreased 3% in the second quarter of 2009 to 42.1 million MMBtu and increased 1% to 94.6 million MMBtu in the first half of 2009 compared to 93.4 million MMBtu in the 2008 period. Fee-based gas-processing revenues increased $0.4 million or 6% compared to the year ago quarter and $1.6 million or 12% in the first half of 2009 compared to the first half of 2008. Approximately 82% of Gas Management net operating revenue (total revenue less processing plant-shrink) was derived from fee-based contracts compared to 72% in the 2008 quarter.
Energy Trading net income was $0.8 million in the second quarter of 2009, a decrease of 83% compared to $4.8 million in the 2008 quarter and decreased $6.7 million in the first half of 2009 compared to 2008 as a result of lower marketing margins. First half revenues from unaffiliated customers were $191.6 million in 2009 compared to $387.4 million in 2008, a 51% decrease, primarily the result of lower natural gas prices. The weighted-average natural gas sales price decreased 59% in the first half of 2009 to $3.18 per MMBtu compared to $7.74 per MMBtu in the 2008 period.
Questar Pipeline, which provides interstate natural gas-transportation and storage services, reported second quarter 2009 net income of $15.0 million compared with $12.7 million in 2008, an 18% increase. Net income for the first half of 2009 was $29.7 million compared with $28.6 for the first half of 2008. The second quarter of 2008 included one-time items that reduced net income by $2.1 million. Following is a summary of Questar Pipeline financial and operating results:
Read the The complete ReportSTR is in the portfolios of T Boone Pickens of BP Capital, Irving Kahn of Kahn Brothers & Company Inc., John Keeley of Keeley Fund Management.
