Berry Petroleum's 2005 Earnings Climb 62% to $5.00 Per Share; Production, Reserves Also Reach Record Highs.BAKERSFIELD Bakersfield, city (1990 pop. 174,820), seat of Kern co., S central Calif., at the southern end of the San Joaquin valley; inc. 1898. It is an oil, mining, and agricultural center and one of the fastest-growing U.S. cities. , Calif. -- Berry Berry, former province, France Berry (bĕrē`), former province, central France. Bourges, the capital, and Châteauroux are the chief towns. Petroleum Company (NYSE NYSE See: New York Stock Exchange :BRY BRY could refer to:
Bry ) earned $30.4 million, or $1.35 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, in the fourth quarter of 2005, which was 20% higher than the $25.3 million, or $1.11 per diluted share, the Company achieved in the fourth quarter of 2004. For 2005, the Company achieved record net income of $112.4 million, or $5.00 per diluted share, an increase of 62% compared to 2004 net income of $69.2 million, or $3.08 per diluted share, according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. Robert Robert, Henry Martyn 1837-1923. American army engineer and parliamentary authority. He designed the defenses for Washington, D.C., during the Civil War and later wrote Robert's Rules of Order (1876). Noun 1. F. Heinemann Heinemann may refer to:
n. A mark (´) indicating: a. that a vowel is close or tense, as é in French été. b. that a vowel or syllable has a high or rising pitch, as in Chinese or Ancient Greek. c. ]Berry continued its transformation of diversifying its resource base in 2005 by adding a new core natural gas operating area and through solid execution of its active drilling program. The Company's activities and strong commodity pricing generated powerful results with the following ten records set in 2005: Average production: 23,015 BOE per day 12% increase over 2004 Revenues: $407 million 48% increase over 2004 Cash flow from operations: $188 million 50% increase over 2004 Net income: $112 million 62% increase over 2004 Capital expenditures: $131 million 82% increase over 2004 Acquisitions: $112 million versus $3 million 2004 Reserve additions: 24.9 million BOE 236% increase over 2004 Price realization: $41.62/BOE 37% increase over 2004 Dividend distributions: $13.2 million 16% increase over 2004 Return on capital employed: 33% versus 26% in 2004 E[acute accent]Mr. Heinemann commented, "The story behind the revenue, cash flow and earnings records in 2005 was our ability to increase production by 12% to a record 23,015 BOE BOE Based on Experience BOE Board of Education BOE Boletín Oficial del Estado (Spanish) BOE Bank of England BOE Board of Equalization BOE Board of Elections BOE Barrel of Oil Equivalent BOE Bind on Equip per day (or 8.4 million BOE for the year) and realization (specification) realization - A UML semantic relationship between a classifier that specifies a contract and another classifier that guarantees to carry it out. [Handout by Mr. David Gillibrand]. of excellent commodity prices, achieving $41.62 per BOE, up 37% from the average BOE realized price in 2004 of $30.32. Our overall 2005 performance benefited from accelerated execution of our drilling programs, and the acquisition and successful integration of our Colorado Colorado, state, United States Colorado (kŏlərăd`ə, –răd`ō, –rä`dō), state, W central United States, one of the Rocky Mt. states. Niobrara Niobrara (nīəbrâr`ə), river, c.430 mi (690 km) long, rising in the High Plains, E Wyo., and flowing E across N Nebraska to the Missouri River on Nebraska's northeast border. gas assets acquired in the first quarter of 2005. In 2005, we incurred $243 million in total capital expenditures, $119 million in development and exploration, $112 million in acquisitions, and $12 million in the purchase of rigs and other assets other assets Assets of relatively small value. For financial reporting purposes, firms frequently combine small assets into a single category rather than listing each item separately. . E[acute accent]"Our focus on capital efficiency generated a stellar return on capital of 33% for 2005. We added approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 25 million BOE in reserves for a reserve replacement rate of 296%. We had an extremely active and well-coordinated year in drilling and field operations in which we drilled 188 new wells and 140 well workovers with only 6 dry holes. We accomplished this while maintaining an excellent safety record, and on February February: see month. 5, 2006, we achieved over 1,000,000 man hours of operations without a lost-time incident. This major milestone “Milemarker” redirects here. For the American indie rock band, see Milemarker (band). A milestone or kilometre sign is one of a series of numbered markers placed along a road at regular intervals, typically at the side of the road or in a median. was accomplished over a three-year period of time. E[acute accent]"In 2005, we added the eastern Colorado Niobrara assets as a new core area and expanded this acreage position by adding another 434,000 gross acres (191,000 net) in the Tri-State area There are a number of places in the United States known as tri-state areas where three states or holdings meet at one point (a tripoint), or in proximity to each other. The two most well-known are for the New York and Chicago metropolitan areas. (Colorado, Kansas Kansas, state, United States Kansas (kăn`zəs), midwestern state occupying the center of the coterminous United States. It is bordered by Missouri (E), Oklahoma (S), Colorado (W), and Nebraska (N). and Nebraska Nebraska (nəbrăs`kə), Great Plains state of the central United States. It is bordered by Iowa and Missouri, across the Missouri R. (E), Kansas (S), Colorado (SW), Wyoming (NW), and South Dakota (N). ) to our prospective inventory, and we added 186,000 gross acres (46,000 net) in the North Dakota North Dakota, state in the N central United States. It is bordered by Minnesota, across the Red River of the North (E), South Dakota (S), Montana (W), and the Canadian provinces of Saskatchewan and Manitoba (N). Bakken light oil play. In 2005, we focused our exploration and appraisal activities on three potentially very significant areas or projects. These were:
1) Lake Canyon -- Green River Formation. We drilled two
exploratory wells about three miles west of our producing
Brundage Canyon property into our 169,000 untested acreage
block. Both wells discovered hydrocarbons, and we announced
initial results in January of 2006. These wells indicate that
the Green River Formation continues to be productive to the
west of Brundage Canyon. We are adding a gas pipeline to the
area to produce the associated gas, and are proceeding with the
next four wells. We are preparing for a 30-well program if
results from these four wells are satisfactory.
2) Coyote Flats. We continue to drill our obligation wells to earn
our 50% WI in the 69,000 gross acres. We have drilled an offset
well to the discovery well and a second Ferron well about three
miles south of the discovery well. We are testing both wells
and are pleased with the early results. We are adding pipeline
access to achieve gas sales in mid-summer.
3) Diatomite. We are seeing encouraging results with production
nearing 300 barrels per day. We expanded our initial pilot
program by drilling another 25 wells (15 producers) in the
fourth quarter of 2005. While this activity reduced our
production from the diatomite in the fourth quarter, it sets
the stage for pressure build-up and increased production in the
first half of 2006. Upon satisfactory results, we are ready to
proceed with another 50 well program later in 2006."
E[acute accent]Mr. Heinemann continued, "We will continue to actively explore and appraise appraise v. to professionally evaluate the value of property including real estate, jewelry, antique furniture, securities, or in certain cases the loss of value (or cost of replacement) due to damage. our large prospective acreage positions in a decisive manner. With these early successes, we are very focused on an efficient execution of our record $190 million capital program for 2006. Our new production target for 2006 is 25,800 BOE per day, which is another 12% increase in production over 2005, and upon achievement, will be our fourth consecutive year of double-digit dou·ble-dig·it adj. Being between 10 and 99 percent: double-digit inflation. production growth. This target includes our announced Piceance Basin The introduction to this article provides insufficient context for those unfamiliar with the subject matter. Please help [ improve the introduction] to meet Wikipedia's layout standards. You can discuss the issue on the talk page. acquisition which is scheduled to close by March 1, 2006." E[acute accent]Oil and Natural Gas Production & Pricing
Annual Production 2005 % 2004 % 2003 %
------- ---- ------- ---- ------- ----
Oil and Gas
Heavy Oil Production (Bbl/D) 16,063 70 15,901 77 15,477 94
Light Oil Production (Bbl/D) 3,336 14 3,345 16 489 3
------- ---- ------- ---- ------- ----
Total Oil Production (Bbl/D) 19,399 84 19,246 93 15,966 97
Natural Gas Production (Mcf/D) 21,696 16 7,752 7 3,499 3
------- ---- ------- ---- ------- ----
Total (BOE/D) 23,015 100 20,537 100 16,549 100
Percentage increase from prior
year 12% 24% 15%
E[acute accent]For the full-year of 2005, California California (kăl'ĭfôr`nyə), most populous state in the United States, located in the Far West; bordered by Oregon (N), Nevada and, across the Colorado River, Arizona (E), Mexico (S), and the Pacific Ocean (W). production averaged 16,156 BOE per day (70%), while the Rockies assets contributed 5,259 BOE per day (23%), and the Mid-Continent assets contributed 1,600 BOE per day (7%) of the Company's total 2005 production. E[acute accent]The average realized sales price net of hedging hedging, in commerce, method by which traders use two counterbalancing investment strategies so as to minimize any losses caused by price fluctuations. It is generally used by traders on the commodities market. for the full-year 2005 was $41.62 per BOE, up 37% over the $30.32 per BOE received in the 2004 period.
Fourth Quarter Production Q4 2005 % Q4 2004 % Q4 2003 %
------- ---- ------- ---- ------- ----
Oil and Gas
Heavy Oil Production (Bbl/D) 15,997 68 16,174 76 16,088 87
Light Oil Production (Bbl/D) 3,438 14 3,722 17 1,582 9
------- ---- ------- ---- ------- ----
Total Oil Production (Bbl/D) 19,435 82 19,896 93 17,670 96
Natural Gas Production (Mcf/D) 25,428 18 9,084 7 5,280 4
------- ---- ------- ---- ------- ----
Total (BOE/D) 23,673 100 21,410 100 18,550 100
Percentage increase from prior
quarter 11% 15% 21%
E[acute accent]For the fourth quarter of 2005, California production averaged 16,080 BOE per day (68%), while the Rockies assets contributed 5,605 BOE per day (24%), and the Mid-Continent assets contributed 1,988 BOE per day (8%) of the Company's total fourth quarter production. E[acute accent]The average realized sales price after hedging for the fourth quarter of 2005 was $44.90 per BOE, a 30% gain over the $34.62 per BOE received in the same 2004 period. E[acute accent]Ralph J. Goehring Goehring may refer to:
execute - execution value-adding acquisitions that meet our strategy and will remain disciplined in our capital expenditures and operational focus. We are off to a good start as we add another major core area, the Piceance Basin (pending closing), to our growing list of operated sizable siz·a·ble also size·a·ble adj. Of considerable size; fairly large. siz  a·ble·ness n. acreage positions. We expect 2006 to be another exciting and
rewarding year for Berry and our shareholders."E[acute accent]Teleconference Call E[acute accent]An earnings conference call will be held Wednesday Wednesday: see week. , February 22, 2006, at 1:30 p.m. Eastern Time (10:30 a.m. Pacific Time). Dial 1-866-825-1709 to participate, using passcode 23263458. International callers may dial 617-213-8060. For a digital replay available until March 7, 2005, dial 1-888-286-8010 (passcode 30001789). Listen live or via replay on the web at www.bry.com. Transcripts of this and previous calls may be viewed at www.bry.com in the "Investor Center." E[acute accent]About Berry Petroleum Company E[acute accent]Berry Petroleum Company is a publicly traded independent oil and gas production and exploitation Exploitation See also Opportunism. Barnum, P. T. (1810–1891) circus impressario famous for his saying, “Never give a sucker an even break.” [Am. Hist. company with its headquarters in Bakersfield, and a regional office in Denver Denver, city (1990 pop. 467,610), alt. 5,280 ft (1,609 m), state capital, coextensive with Denver co., N central Colo., on a plateau at the foot of the Front Range of the Rocky Mts., along the South Platte River where Cherry Creek meets it; inc. 1861. . E[acute accent]Safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. under the "Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995 E[acute accent]Any statements in this news release that are not historical facts are forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. that involve risks and uncertainties. Words such as "will," "preparing," "appraise," "continue," "target," "expect," and others indicate forward-looking statements and important factors which could affect actual results are discussed in Part II of Berry's Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. filed with the Securities and Exchange Commission, under the heading "Other Factors Affecting the Company's Business and Financial Results" in the section titled "Management's Discussion and Analysis Management's discussion and analysis (MD&A) A report from management to shareholders that accompanies the firm's financial statements in the annual report. It explains the period's financial results and enables management to discuss topics that may not be apparent in the financial of Financial Condition and Results of Operations."
CONDENSED INCOME STATEMENTS
(In thousands, except per share data)
(unaudited)
Three Months Twelve Months
--------------------- ---------------------
12/31/05 12/31/04 12/31/05 12/31/04
--------- --------- --------- ---------
Revenues
Sales of oil and gas $ 97,055 $ 67,356 $ 349,691 $ 226,876
Sales of electricity 18,328 13,075 55,230 47,644
Interest and other
income, net 674 89 1,804 426
--------- --------- --------- ---------
Total 116,057 80,520 406,725 274,946
--------- --------- --------- ---------
Expenses
Operating costs - oil &
gas 29,710 23,481 99,066 75,988
Operating costs -
electricity 18,490 12,776 55,086 46,191
Production taxes 2,937 217 11,506 6,431
Exploration costs 2,114 - 3,649 -
Depreciation, depletion
& amortization - oil &
gas 11,350 8,255 38,150 29,752
Depreciation, depletion
& amortization -
electricity 816 951 3,260 3,490
General and
administrative 5,408 3,398 21,396 20,354
Loss on disposal of
assets - 410 - 410
Dry hole, abandonment &
impairment 280 745 5,705 745
Interest 1,547 490 6,048 2,067
--------- --------- --------- ---------
Total 72,652 50,723 243,866 185,428
--------- --------- --------- ---------
Income before income taxes 43,405 29,797 162,859 89,518
Provision for income taxes 13,033 4,481 50,503 20,331
--------- --------- --------- ---------
Net income $ 30,372 $ 25,316 $ 112,356 $ 69,187
========= ========= ========= =========
Basic net income per share $ 1.39 $ 1.15 $ 5.10 $ 3.16
Diluted net income per
share $ 1.35 $ 1.11 $ 5.00 $ 3.08
Cash dividends per share $ 0.13 $ 0.12 $ .60 $ .52
Weighted average common
shares:
Basic 22,048 21,949 22,041 21,894
========= ========= ========= =========
Diluted 22,496 22,670 22,490 22,470
========= ========= ========= =========
CONDENSED BALANCE SHEETS
(In thousands)
(unaudited)
12/31/05 12/31/04
--------------- --------------
Assets
Current assets $ 74,886 $ 61,001
Property, buildings & equipment,
net 552,984 338,706
Other assets 7,181 12,397
--------------- --------------
$ 635,051 $ 412,104
=============== ==============
Liabilities & Shareholders' Equity
Current liabilities $ 129,643 $ 64,841
Deferred taxes 55,804 47,963
Long-term debt 75,000 28,000
Other long-term liabilities 40,394 8,214
Shareholders' equity 334,210 263,086
--------------- --------------
$ 635,051 $ 412,104
=============== ==============
CONDENSED STATEMENTS OF CASH FLOWS
(In thousands)
(unaudited)
Twelve Months
--------------------------------
12/31/05 12/31/04
--------------- --------------
Cash flows from operating activities:
Net income $ 112,356 $ 69,187
Depreciation, depletion &
amortization (DD&A) 41,409 33,242
Dry hole, abandonment & impairment 4,324 (569)
Deferred income taxes 20,847 10,815
Stock-based compensation 1,703 5,309
Other, net 278 794
Net changes in operating assets and
liabilities 6,863 5,835
--------------- --------------
Net cash provided by operating
activities 187,780 124,613
Net cash used in investing activities (242,599) (85,187)
Net cash provided by (used in)
financing activities 40,119 (33,394)
--------------- --------------
Net (decrease) increase in cash and
cash equivalents (14,700) 6,032
Cash and cash equivalents at
beginning of year 16,690 10,658
--------------- --------------
Cash and cash equivalents at end of
period $ 1,990 $ 16,690
=============== ==============
COMPARATIVE OPERATING STATISTICS
(unaudited)
Three Months Twelve Months
-------------------------- --------------------------
12/31/05 12/31/04 Change 12/31/05 12/31/04 Change
--------- --------- ------ --------- --------- ------
Oil and gas:
Net production-
BOE per day 23,673 21,410 +11% 23,015 20,537 +12%
Per BOE:
Average sales
price before
hedges $51.71 $39.54 +31% $47.01 $33.64 +40%
Average sales
price after
hedges $44.90 $34.62 +30% $41.62 $30.32 +37%
Operating costs 13.66 11.03 +24% 11.79 10.10 +17%
Production
taxes 1.35 .11 +1127% 1.37 .86 +59%
--------- --------- --------- ---------
Total
operating
costs 15.01 11.14 +35% 13.16 10.96 +20%
DD&A - oil and
gas 5.22 4.19 +25% 4.54 3.96 +15%
General &
administrative
expenses 2.49 2.62 -5% 2.55 2.71 -6%
Interest
expense $.71 $.23 +209% $.72 $.27 +167%
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