Belco Oil & Gas Reports Second Quarter Results.NEW YORK--(BUSINESS WIRE)--August 6, 1996--Belco Oil & Gas Corp. (NYSE NYSE See: New York Stock Exchange :BOG bog, very old lake without inlet or outlet that becomes acid and is gradually overgrown with a characteristic vegetation (see swamp). Peat moss, or sphagnum, grows around the edge of the open water of a bog (peat is obtained from old bogs) and out on the surface. ) today announced its financial results for the second quarter ended June June: see month. 30, 1996. The company reported revenues of $31.6 million, a 62% increase over revenues of $19.5 million for the comparable period of 1995. Net income for the quarter totaled $12.4 million or $0.39 per common share, an increase of 75% over pro-forma net income of $7.1 million or $0.28 per common share for the second quarter of 1995. Continued successful drilling in the Giddings Field in Texas, coupled with higher average prices realized for both oil and natural gas spurred the increase in revenues and profitability. Net operating cash flow Operating cash flow Earnings before depreciation minus taxes. Measures the cash generated from operations, not counting capital spending or working capital requirements. (pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta ), before changes in working capital, for the second quarter of calendar year 1996 increased 65% to $28.5 million from $17.3 million for the comparable period of the prior year. For the six months ended June 30, 1996, revenues totaled $60.2 million, a 71% increase over the first six months of 1995. Pre-tax income totaled $35.2 million, an increase of 84% over pre-tax income of $19.2 million for the prior comparable period. During the first quarter, 1996, the company was required to record a one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. , non-cash charge Non-Cash Charge A charge off, made by a company against earnings, that does not require an initial outlay of cash. Notes: Non-cash charges are typically against the depreciation, amortization, and depletion accounts on a company's balance sheet. in the amount of $29.9 million to establish deferred tax liability accounts on its balance sheet as a result of a combination of predecessor entities consummated con·sum·mate tr.v. con·sum·mat·ed, con·sum·mat·ing, con·sum·mates 1. a. To bring to completion or fruition; conclude: consummate a business transaction. b. on March 29, 1996 in connection with its initial public offering. On a pro-forma basis, net income for the six month period totaled $23.4 million or $0.82 per common share compared to $12.8 million or $0.51 per common share for the first six months of 1995. Net operating cash flow (pre-tax) before changes in working capital for the first six months of 1996 increased 74% to $54.5 million from $31.3 million for the comparable period of the prior year. Continued Higher Levels of Production Second quarter oil and natural gas production totaled 14.7 Bcfe (billion cubic feet of natural gas equivalent), a 39% increase over the 10.6 Bcfe produced in the second quarter of 1995. Daily production totaled 161 MMcfe MMcfe Millions of Cubic Feet Equivalent (Per Day; gas exploration) (million cubic feet of natural gas equivalent). Realized average gas equivalent prices,(including price risk management activities), totaled $2.09 per Mcfe for the second quarter 1996, a 14% increase over the prior period comparable prices of $1.84 per Mcfe. Production for the first six months of 1996 is up 44% to 29.3 Bcfe. New Developments Louisiana Louisiana (ləwē'zēăn`ə, l  ē'–), state in the S central United States. It is bounded by Mississippi, with the Mississippi R. Austin Chalk Trend -- Belco now controls in excess of
250,000 net acres along this highly prospective trend. The company
presently operates 2 horizontal wells which are drilling, one in
Avoyelles Parish and the other in St. Landry Parish. One of these
wells, the Turner no. 1 is expected to be the deepest horizontal well
ever drilled with a proposed total vertical depth of nearly 17,000
feet.Central Basin, Mich. -- Belco recently acquired a 35% interest, with an option to purchase an additional 15% interest in 220,000 net acres in the Central Basin of Michigan Michigan (mĭsh`ĭgən), upper midwestern state of the United States. It consists of two peninsulas thrusting into the Great Lakes and has borders with Ohio and Indiana (S), Wisconsin (W), and the Canadian province of Ontario (N,E). . Belco will be the operator on this acreage and plans to re-enter re·en·ter also re-en·ter v. re·en·tered, re·en·ter·ing, re·en·ters v.tr. 1. To enter or come in to again. 2. To record again on a list or ledger. v.intr. 7 existing wells and to drill 2 grass roots grass roots pl.n. (used with a sing. or pl. verb) 1. People or society at a local level rather than at the center of major political activity. Often used with the. 2. The groundwork or source of something. wells in order to test the shallower zones. Drilling on this large block will commence on the fourth quarter of 1996. Belco believes that the sands underlying this block can be effectively simulated and well costs reduced so as to achieve attractive economics. If initial drilling results are successful, Belco would anticipate a development program similar to what it achieved in the Moxa moxa (mok´sah) [Japanese] the dried leaves of Artemisia vulgaris, burned on or near acupoints in moxibustion. mox·a n. Arch, Wyo., but with a much more favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. market for gas. 3-D Seismic Programs, Texas -- Belco currently has two 50+ square mile 3-D seismic programs underway in Texas. The first is in the exploratory Cotton Valley Reef Trend of east Texas. The second is in the Frio Wilcox Play of south Texas. Drilling on both these prospects is not likely to commence before late 1996 or early 1997. Moxa Arch, Wyo. -- Belco has not been active in this area during 1996 due to the relatively low Rocky Mountain gas prices compared to other areas of Belco's activities. As of August 1, Belco assumed operations for 73 producing wells along the Moxa Arch and will be the operator of any offsets to these wells which are ultimately drilled. Ongoing Success in Texas Giddings Field -- During the second quarter of 1996, Belco continued the successful development of its Giddings Field acreage, primarily in the Navasota and Independence areas. In particular, recent wells such as the Heil no.1-H and the JEB JEB Journal of Experimental Biology JEB James Ewell Brown (Stuart, Confederate general) JEB John Ellis Bush JEB Java-Enabled Browser JEB Janssen Engineering Building (University of Idaho) DL where Belco has a 60% working interest (W.I.) and the Claire OL no.1-H well where Belco has a 54% W.I. have each had initial production rates in excess of 10 MMcfe per day. Average results in Grimes Grimes is a surname, that is believed to be of a Scandinavian decent and may refer to
See also: Chalk have been considerably better than in the Georgetown formation. Consequently, Belco will be emphasizing Austin Chalk drilling in Grimes County in the coming months. Belco expects to have 8-9 rigs operating in the Giddings field for the remainder of the year. Results from Belco's first well, the Gibbs-Smith no.1 in the 100% owned 40,000 acre prospect in Walker County were inconclusive INCONCLUSIVE. What does not put an end to a thing. Inconclusive presumptions are those which may be overcome by opposing proof; for example, the law presumes that he who possesses personal property is the owner of it, but evidence is allowed to contradict this presumption, and show who is . Belco is currently in the process of drilling its second well on this block to further test its potential. Belco Continues Its Low Cost Structure Belco's production and operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. and G&A expenses increased 44% and 33% to $2.13 million and $880,000 respectively for the second quarter 1996, however on a per Mcfe basis, they remained the same at $0.14 and $0.06 respectively. Depreciation, depletion depletion n. when a natural resource (particularly oil) is being used up. The annual amount of depletion may, ironically, provide a tax deduction for the company exploiting the resource because if the resource they are exploiting runs out, they will no longer be able and amortization costs for oil and gas properties of $0.67 per Mcfe when added to the above costs resulted in an operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. per Mcfe of $1.28, a 28% increase over the $1.00 per Mcfe operating profit for the second quarter of 1995. Belco Oil & Gas Corp., headquartered in New York City New York City: see New York, city. New York City City (pop., 2000: 8,008,278), southeastern New York, at the mouth of the Hudson River. The largest city in the U.S. , is an independent energy company engaged in the exploration, development and production of natural gas and oil. This press release includes forward looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although BOG believes that its expectations are based on reasonable assumptions, it can give no assurance that its goals will be achieved. Important factors that could cause actual results to differ materially from those in the forward looking statements herein include the timing and extent of changes in commodity prices for oil and gas, the need to develop and replace reserves, environmental risks, drilling and operating risks Operating risk The inherent or fundamental risk of a firm, without regard to financial risk. The risk that is created by operating leverage. Also called business risk. , risks related to exploration and development, uncertainties about the estimates of reserves, competition, government regulation and the ability of the company to meet its stated business goals. -0-
BELCO OIL & GAS CORP.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
1996 1995 1996 1995
REVENUES
Oil and gas sales $29,819 $17,724 $56,646 $31,058
Commodity Price Risk
Management 855 1,709 2,633 4,062
Interest and other 881 23 886 37
Total revenues 31,555 19,456 60,165 35,157
COSTS AND EXPENSES:
Oil and gas operating
expenses 2,127 1,480 3,879 2,658
Depreciation, depletion and
amortization 9,830 6,766 19,320 12,153
General and administrative 880 664 1,756 1,169
Total costs and expenses 12,837 8,910 24,955 15,980
INCOME BEFORE INCOME TAXES 18,718 10,546 35,210 19,177 PROVISION FOR INCOME TAXES 6,364 0 36,264(a) 0 NET INCOME (LOSS) $12,354 $10,546 ($1,054)(a) $19,177 PRO FORMA NET INCOME Income before income taxes $18,718 $10,546 $35,210 $19,177 Pro forma provision for income taxes 6,364 3,480 11,790 6,328 Pro forma net income $12,354 $7,066 $23,420 $12,849 PRO FORMA NET INCOME PER COMMON SHARE $ 0.39 $ 0.28 $ 0.82 $ 0.51 WEIGHTED AVERAGE NUMBER OF COMMON SHARES 31,606 25,000 28,502 25,000
(a) Includes a one-time non-cash deferred tax charge of $29.9
million recognized as a result of the Combination consummated
on March 29, 1996 in connection with the company's Initial
Public Offering and discussed in the Belco Oil & Gas Corp.
Prospectus dated March 25, 1996. Historical loss per share,
including the deferred tax charge, was $0.04 for the six month
ended June 30, 1996. The pro forma amounts present the
company as if a taxable corporation for all periods and
is based on the average number of shares outstanding during the
period assuming the Combination.
-0- The following table sets forth certain operations data of the company for the periods presented:
Three Months Ended June 30,
1996 1995
Oil and Gas Sales (Unhedged) (in thousands) $ 29,819 $ 17,724 Commodity Price Hedging 855 1,709 Weighted Average Sales Prices (Unhedged): Oil (per Bbl) $ 21.71 $ 18.31 Gas (per Mcf) 1.90 1.47 Net Production Data: Oil (MBbl) 192 255 Gas (MMcf) 13,521 9,041 Gas equivalent (MMcfe) 14,671 10,572
Data per Mcfe:
Oil and gas sales revenues
(Unhedged) $ 2.03 $ 1.68
Commodity Price Hedging 0.06 0.16
Oil and gas operating expenses (0.14) (0.14)
General and administrative (0.06) (0.06)
Depreciation, depletion and
amortization (0.67) (0.64)
Interest income (Net) 0.06 --
Pre-tax operating profit $ 1.28 $ 1.00
-0-
Six Months Ended June 30,
1996 1995
Oil and Gas Sales (Unhedged) (in thousands) $ 56,646 $ 31,058 Commodity Price Hedging 2,633 4,062 Weighted Average Sales Prices (Unhedged): Oil (per Bbl) $ 19.93 $ 17.92 Gas (per Mcf) 1.81 1.40 Net Production Data: Oil (MBbl) 414 481 Gas (MMcf) 26,787 17,468 Gas equivalent (MMcfe) 29,271 20,352
Data per Mcfe:
Oil and gas sales revenues
(Unhedged) $ 1.94 $ 1.53
Commodity Price Hedging 0.09 0.20
Oil and gas operating expenses (0.13) (0.13)
General and administrative (0.06) (0.06)
Depreciation, depletion and
amortization (0.66) (0.60)
Interest income (Net) 0.02 --
Pre-tax operating profit $ 1.20 $ 0.94
CONTACT: Belco Oil & Gas Corp., New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of Laurence D. Belfer, Exec. VP, COO (Cell Of Origin) See mobile positioning. 212/644-0561 or Myra E. Turoff, Investor Relations Investor relations The process by which the corporation communicates with its investors. 212/508-9539 |
|
||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion