Callon Petroleum Company Reports First Quarter 2006 Results of Operations.NATCHEZ Natchez, city, United States Natchez, city (1990 pop. 19,460), seat of Adams co., SW Miss., on bluffs above the Mississippi River; settled 1716, inc. 1803. , Miss. -- Callon Petroleum Company (NYSE NYSE See: New York Stock Exchange : CPE (Customer Premises Equipment) Communications equipment that resides on the customer's premises. CPE - Customer Premises Equipment ) today reported its results of operations for the three-month period ended March 31, 2006. First Quarter 2006 Net Income. For the three-month period ended March 31, 2006, Callon reported record net income of $12.7 million, or $0.60 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. For the first quarter of 2005, the company reported net income of $9.5 million, or $0.46 per diluted share. First Quarter 2006 Operating Results. Oil and gas sales totaled $45.6 million from average production of 56.0 million cubic feet of natural gas equivalent per day (MMcfe/d). This corresponds to sales of $43.0 million from average production of 73.3 MMcfe/d during the same period in 2005. During the first quarter of 2006, natural gas represented approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 39 percent of the company's total production. The average price realized per thousand cubic feet of natural gas in the first quarter of 2006 increased by 32 percent to $9.12 compared to $6.92 during the first quarter of 2005, while the average price realized per barrel barrel: see English units of measurement. of oil in the first quarter of 2006 increased by 44 percent to $53.95 compared to $37.46 during the same period in 2005. First Quarter 2006 Discretionary Cash Flow Discretionary cash flow Cash flow that is available after the funding of all positive net present value (NPV) capital investment projects; it is available for paying cash dividends, repurchasing common stock, retiring debt, and so on. . For the quarter ended March 31, 2006, discretionary cash flow increased by 8 percent to $33.8 million compared to $31.4 million during the same period a year earlier. Net cash flow provided by operating activities, as defined by GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). , totaled $41.0 million and $21.3 million during the quarter ended March 31, 2006 and 2005, respectively. (See "Non-GAAP Financial Measure" that follows and the accompanying ac·com·pa·ny v. ac·com·pa·nied, ac·com·pa·ny·ing, ac·com·pa·nies v.tr. 1. To be or go with as a companion. 2. financial information for a reconciliation of discretionary cash flow, a non-GAAP measure, to net cash flow provided by operating activities.) Non-GAAP Financial Measure - This news release refers to a non-GAAP financial measure as "discretionary cash flow." Callon believes that the non-GAAP measure of discretionary cash flow is useful as an indicator Indicator Anything used to predict future financial or economic trends. Notes: In the context of technical analysis, an indicator is a mathematical calculation based on a securities price and/or volume. The result is used to predict future prices. of an oil and gas exploration and production company's ability to internally fund exploration and development activities and to service or incur To become subject to and liable for; to have liabilities imposed by act or operation of law. Expenses are incurred, for example, when the legal obligation to pay them arises. An individual incurs a liability when a money judgment is rendered against him or her by a court. additional debt. The company also has included this information because changes in operating assets Operating Assets Another term for working capital. and liabilities relate to the timing of cash receipts and disbursements which the company may not control and may not relate to the period in which the operating activities occurred. Discretionary cash flow should not be considered an alternative to net cash provided by operating activities or net income as defined by GAAP.
Reconciliation of Non-GAAP Financial Measure: Three Months Ended
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(In thousands) March 31,
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2006 2005
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Discretionary cash flow $ 33,780 $ 31,414
Net working capital changes and other changes 7,236 (10,083)
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Net cash flow provided by operating activities $ 41,016 $ 21,331
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Consolidated Condensed Balance Sheets: March 31 December 31
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(In thousands) 2006 2005
--------- ---------
(Unaudited)
Cash and cash equivalents $ 5,139 $ 2,565
Oil and gas properties, net 487,392 447,364
All other assets 93,433 83,847
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Total assets $ 585,964 $ 533,776
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Long-term debt excluding current maturities $ 194,218 $ 188,813
All other liabilities 148,677 116,915
Stockholders' equity 243,069 228,048
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Total liabilities and stockholders' equity $ 585,964 $ 533,776
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Production and Price Information: Three Months Ended
---------------------------------
March 31,
---------------------
2006 2005
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Production:
Oil (MBbls) 515 641
Gas (MMcf) 1,950 2,748
Total Production (MMcfe) 5,042 6,593
Average daily (MMcfe) 56.0 73.3
Average prices:
Oil ($/Bbl) (a) $ 53.95 $ 37.46
Gas ($/Mcf) $ 9.12 $ 6.92
Gas equivalent ($/Mcfe) $ 9.04 $ 6.52
(a) Below is a reconciliation of the average
NYMEX price to the average realized sales price
per barrel of oil:
Average NYMEX oil price $ 63.48 $ 49.85
Basis differentials and quality adjustments (7.52) (6.33)
Transportation (1.27) (1.31)
Hedging (0.74) (4.75)
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Average realized oil price $ 53.95 $ 37.46
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Callon Petroleum Company
Consolidated Statements of Operations
(Unaudited)
(In thousands, except share amounts)
Three Months Ended
March 31,
--------------------
2006 2005
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Operating revenues:
Oil and gas sales $ 45,581 $ 43,012
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Operating expenses:
Lease operating expenses 5,905 6,536
Depreciation, depletion and amortization 13,836 15,408
General and administrative 1,726 1,694
Accretion expense 1,419 861
Derivative expense 90 379
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Total operating expenses 22,976 24,878
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Income from operations 22,605 18,134
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Other (income) expenses:
Interest expense 4,148 4,569
Other income (330) (202)
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Total other (income) expenses 3,818 4,367
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Income before income taxes 18,787 13,767
Income tax expense 6,550 4,818
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Income before Medusa Spar LLC 12,237 8,949
Income from Medusa Spar LLC, net of tax 530 526
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Net income 12,767 9,475
Preferred stock dividends -- 318
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Net income available to common shares $ 12,767 $ 9,157
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Net income per common share:
Basic $ 0.66 $ 0.52
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Diluted $ 0.60 $ 0.46
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Shares used in computing net income:
Basic 19,396 17,671
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Diluted 21,329 20,678
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Callon Petroleum Company is engaged in the exploration, development, acquisition and operation of oil and gas properties primarily in the Gulf Coast region. Callon's properties and operations are geographically ge·o·graph·ic also ge·o·graph·i·cal adj. 1. Of or relating to geography. 2. Concerning the topography of a specific region. ge concentrated in the offshore waters of the Gulf of Mexico Noun 1. Gulf of Mexico - an arm of the Atlantic to the south of the United States and to the east of Mexico Golfo de Mexico Atlantic, Atlantic Ocean - the 2nd largest ocean; separates North and South America on the west from Europe and Africa on the east . This news release is posted on the company's website at www.callon.com and will be archived there for subsequent review. It can be accessed from the "News Releases" link on the left side of the homepage See home page. . It should be noted that this news release contains projections and other 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. within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These projections and statements reflect the company's current views with respect to future events and financial performance. No assurances can be given, however, that these events will occur or that these projections will be achieved and actual results could differ materially from those projected as a result of certain factors. Some of the factors which could affect our future results and could cause results to differ materially from those expressed in our forward-looking statements are discussed in our filings with the Securities and Exchange Commission, including our Annual Reports on 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. , available on our website or the SEC's website at www.sec.gov See .gov and GovNet. (networking) gov - The top-level domain for US government bodies. . |
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