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Eastern American Natural Gas Trust Depos Reports Operating Results (10-Q)

August 08, 2012 | About:

Eastern American Natural Gas Trust Depos (NGT) filed Quarterly Report for the period ended 2012-06-30.

Eastern American Natural Gas Trust has a market cap of $125.4 million; its shares were traded at around $21.38 with and P/S ratio of 17.1. The dividend yield of Eastern American Natural Gas Trust stocks is 2.7%.

Highlight of Business Operations:

The Trust's Distributable Income was $797,457 for the three months ended June 30, 2012 as compared to $1,586,758 for the three months ended June 30, 2011. This decrease was due to a decrease in Royalty Income of $643,666 ($1,268,807 for the three months ended June 30, 2012 as compared to $1,912,473 for the three months ended June 30, 2011). This decrease in Royalty Income was related to a decrease in the price payable to the Trust under the Gas Purchase Contract as discussed below ($3.190 per Mcf for the three months ended June 30, 2012 as compared to $5.105 per Mcf for the three months ended June 30, 2011). Offsetting this decrease was an increase in production of gas attributable to the Net Profits Interests for the three months ended June 30, 2012 (398 MMcf) as compared to the three months ended June 30, 2011 of (374 MMcf). The increase in production is primarily attributable to increased production from several wells in West Virginia which are located in an area experiencing increased drilling and completion activities, partially offset by natural production declines. Taxes on Production and Property were $96,881 for the three months ended June 30, 2012 as compared to $135,191 for the three months ended June 30, 2011. The decrease in taxes is due directly to the decrease in Royalty Income as discussed above. General and Administrative Expenses were $224,595 for the three months ended June 30, 2012 as compared to $229,430 for the three months ended June 30, 2011. The decrease in General and Administrative Expenses was due primarily to a decrease in professional fees.

The price payable to the Trust for gas production attributable to the Net Profits Interests was $3.190 per Mcf for the three months ended June 30, 2012 and $5.105 per Mcf for the three months ended June 30, 2011. The price per Mcf was lower for the three months ended June 30, 2012 than for the corresponding three month period ended June 30, 2011 due to a decrease in the average spot market price for gas delivered at the Henry Hub near Henry, Louisiana ($2.600 per million British Thermal Units ("Dth") for the three months ended June 30, 2012 as compared to $4.341 per Dth for the three months ended June 30, 2011).

The Trust's Distributable Income was $1,657,342 for the six months ended June 30, 2012 as compared to $2,639,372 for the six months ended June 30, 2011. This decrease was due to a decrease in Royalty Income of $890,968 ($2,767,507 for the six months ended June 30, 2012 as compared to $3,658,475 for the six months ended June 30, 2011). The decrease in Royalty Income was due to a decrease in the price payable to the Trust under the Gas Purchase Contract as discussed below ($3.517 per Mcf for the six months ended June 30, 2012 as compared to $4.976 per Mcf for the six months ended June 30, 2011). Offsetting this decrease was an increase in production of gas attributable to the Net Profits Interests for the six months ended June 30, 2012 (789 MMcf) as compared to the six months ended June 30, 2011 (735 MMcf). The increase in production is primarily attributable to increased production from several wells in West Virginia which are located in an area experiencing increased drilling and completion activities, partially offset by natural production declines. Taxes on Production and Property were $207,977 for the six months ended June 30, 2012 as compared to $258,048 for the six months ended June 30, 2011. The decrease in taxes is due directly to the decrease in Royalty Income as discussed above. General and Administrative Expenses were $602,434 for the six months ended June 30, 2012 as compared to $635,310 for the six months ended June 30, 2011. The decrease in General and Administrative Expenses was due primarily to a decrease in professional fees.

The price payable to the Trust for gas production attributable to the Net Profits Interests was $3.517 per Mcf for the six months ended June 30, 2012 and $4.976 per Mcf for the six months ended June 30, 2011. The price per Mcf was lower for the six months ended June 30, 2012 than for the corresponding six month period ended June 30, 2011 due to a decrease in the average spot market price for gas delivered at the Henry Hub near Henry, Louisiana ($2.898 per Dth for the six months ended June 30, 2012 as compared to $4.224 per Dth for the six months ended June 30, 2011).

For the calendar quarter ended June 30, 2012, the high and low closing prices of the Treasury Obligations (which have $1,000 face principal amount), as quoted in the over-the-counter market for United States Treasury obligations were $999.20 and $997.20, respectively. On June 30, 2012, the closing price of the Treasury Obligations, as quoted on such market, was $998.70.

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About the author:

10qk
Charlie Tian, Ph.D., is the founder of GuruFocus. You can now order his book Invest Like a Guru on Amazon.

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