Energen Corp. (EGN, Financial) filed Quarterly Report for the period ended 2010-03-31.
Energen Corp. has a market cap of $3.2 billion; its shares were traded at around $44.49 with a P/E ratio of 11.7 and P/S ratio of 2.2. The dividend yield of Energen Corp. stocks is 1%. Energen Corp. had an annual average earning growth of 35.1% over the past 10 years. GuruFocus rated Energen Corp. the business predictability rank of 2.5-star.EGN is in the portfolios of Chuck Royce of Royce& Associates, Jim Simons of Renaissance Technologies LLC, Diamond Hill Capital of Diamond Hill Capital Management Inc, Jeremy Grantham of GMO LLC, Steven Cohen of SAC Capital Advisors.
O&M expense increased $3.1 million for the quarter. Lease operating expense (excluding production taxes) decreased $2 million for the quarter largely due to lower nonoperated costs ($2.6 million), decreased repair and maintenance expense ($1.1 million), decreased workover expense ($0.9 million), lower ad valorem taxes (approximately $0.6 million) and decreased electrical costs ($0.3 million), partially offset by the June 2009 acquisition of Permian Basin oil properties (approximately $2.6 million) and additional transportation and marketing costs ($1.2 million). Administrative expense increased $4.1 million for the three months ended March 31, 2010 largely due to higher labor and benefit costs primarily related to the Companys performance-based compensation plans (approximately $3.5 million) and increased legal expenses (approximately $1.1 million). Exploration expense rose $1 million in the first quarter of 2010.
Energen Resources DD&A expense for the quarter rose $6.7 million. The average depletion rate for the current quarter was $1.76 per thousand cubic feet equivalent (Mcfe) as compared to $1.54 per Mcfe in the same period a year ago. The increase in the current quarter per unit DD&A rate, which contributed approximately $7.2 million to the increase in DD&A expense, was largely due to higher development costs along with the reserve revisions associated with lower year-end reserve pricing. Partially offsetting the increases in DD&A, Energen Resources experienced higher production in low rate areas which was offset by lower production in high rate areas resulting in a net production volume impact of approximately $0.5 million in the three months ended March 31, 2010.
O&M expense rose 1.1 percent in the current quarter primarily due to increased labor-related costs (approximately $1.8 million), increased consulting and technology cost (approximately $1.2 million), higher marketing expenses (approximately $0.7 million) and increased distribution operation expenses (approximately $0.6 million). Partially offsetting these increases was a decrease to bad debt expense (approximately $3.7 million) which included the correction of a $3 million error identified by Alagasco in the calculation of the estimate of the allowance for doubtful accounts as of December 31, 2009. See Note 1, Basis of Presentation, in the Notes to Unaudited Condensed Financial Statements for further discussion.
The Company had a net outflow of cash from investing activities of $65.4 million for the three months ended March 31, 2010 primarily due to additions of property, plant and equipment. Energen Resources invested $51.5 million (includes approximately $12.7 million of payments associated with accrued development cost) in capital expenditures primarily related to the acquisition and development of oil and gas properties. In January 2010, Energen Resources completed purchases of certain properties for a total cash price of approximately $3.9 million. Utility capital expenditures totaled $14.3 million (excludes approximately $1.9 million of accrued capital cost) year-to-date and primarily represented expansion and replacement of its distribution system and replacement of its support facilities.
As of March 31, 2010, Alagasco has $38.7 million and $31.9 million of derivative instruments which are classified as Level 2 fair values and are included in the table as current and noncurrent liabilities, respectively. As of December 31, 2009, Alagasco has $25.8 million and $19 million of derivative instruments which are classified as Level 2 fair values and are included in the table as current and noncurrent liabilities, respectively. Alagasco had no derivative instruments classified as Level 3 fair values as of March 31, 2010 and December 31, 2009.
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Energen Corp. has a market cap of $3.2 billion; its shares were traded at around $44.49 with a P/E ratio of 11.7 and P/S ratio of 2.2. The dividend yield of Energen Corp. stocks is 1%. Energen Corp. had an annual average earning growth of 35.1% over the past 10 years. GuruFocus rated Energen Corp. the business predictability rank of 2.5-star.EGN is in the portfolios of Chuck Royce of Royce& Associates, Jim Simons of Renaissance Technologies LLC, Diamond Hill Capital of Diamond Hill Capital Management Inc, Jeremy Grantham of GMO LLC, Steven Cohen of SAC Capital Advisors.
Highlight of Business Operations:
Energens net income totaled $116.7 million ($1.62 per diluted share) for the three months ended March 31, 2010 compared with net income of $95.6 million ($1.33 per diluted share) for the same period in the prior year. Energen Resources Corporation, Energens oil and gas subsidiary, had net income for the three months ended March 31, 2010, of $71.7 million as compared with $47.1 million in the same quarter in the previous year. Significantly higher commodity prices (approximately $27 million after-tax) and increased oil and natural gas liquids production volumes (approximately $4 million after-tax) were partially offset by increased depreciation, depletion and amortization (DD&A) expense (approximately $4 million after-tax) and increased administrative expense (approximately $3 million after-tax). Energens natural gas utility, Alagasco, reported net income of $44.2 million in the first quarter of 2010 compared to net income of $47.5 million. This decrease largely reflects the timing of rate recovery under Alagascos rate-setting mechanisms, partially offset by the utilitys ability to earn on a higher level of equity.O&M expense increased $3.1 million for the quarter. Lease operating expense (excluding production taxes) decreased $2 million for the quarter largely due to lower nonoperated costs ($2.6 million), decreased repair and maintenance expense ($1.1 million), decreased workover expense ($0.9 million), lower ad valorem taxes (approximately $0.6 million) and decreased electrical costs ($0.3 million), partially offset by the June 2009 acquisition of Permian Basin oil properties (approximately $2.6 million) and additional transportation and marketing costs ($1.2 million). Administrative expense increased $4.1 million for the three months ended March 31, 2010 largely due to higher labor and benefit costs primarily related to the Companys performance-based compensation plans (approximately $3.5 million) and increased legal expenses (approximately $1.1 million). Exploration expense rose $1 million in the first quarter of 2010.
Energen Resources DD&A expense for the quarter rose $6.7 million. The average depletion rate for the current quarter was $1.76 per thousand cubic feet equivalent (Mcfe) as compared to $1.54 per Mcfe in the same period a year ago. The increase in the current quarter per unit DD&A rate, which contributed approximately $7.2 million to the increase in DD&A expense, was largely due to higher development costs along with the reserve revisions associated with lower year-end reserve pricing. Partially offsetting the increases in DD&A, Energen Resources experienced higher production in low rate areas which was offset by lower production in high rate areas resulting in a net production volume impact of approximately $0.5 million in the three months ended March 31, 2010.
O&M expense rose 1.1 percent in the current quarter primarily due to increased labor-related costs (approximately $1.8 million), increased consulting and technology cost (approximately $1.2 million), higher marketing expenses (approximately $0.7 million) and increased distribution operation expenses (approximately $0.6 million). Partially offsetting these increases was a decrease to bad debt expense (approximately $3.7 million) which included the correction of a $3 million error identified by Alagasco in the calculation of the estimate of the allowance for doubtful accounts as of December 31, 2009. See Note 1, Basis of Presentation, in the Notes to Unaudited Condensed Financial Statements for further discussion.
The Company had a net outflow of cash from investing activities of $65.4 million for the three months ended March 31, 2010 primarily due to additions of property, plant and equipment. Energen Resources invested $51.5 million (includes approximately $12.7 million of payments associated with accrued development cost) in capital expenditures primarily related to the acquisition and development of oil and gas properties. In January 2010, Energen Resources completed purchases of certain properties for a total cash price of approximately $3.9 million. Utility capital expenditures totaled $14.3 million (excludes approximately $1.9 million of accrued capital cost) year-to-date and primarily represented expansion and replacement of its distribution system and replacement of its support facilities.
As of March 31, 2010, Alagasco has $38.7 million and $31.9 million of derivative instruments which are classified as Level 2 fair values and are included in the table as current and noncurrent liabilities, respectively. As of December 31, 2009, Alagasco has $25.8 million and $19 million of derivative instruments which are classified as Level 2 fair values and are included in the table as current and noncurrent liabilities, respectively. Alagasco had no derivative instruments classified as Level 3 fair values as of March 31, 2010 and December 31, 2009.
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