Clayton Williams Energy Announces Third Quarter 2007 Financial Results and Operations Update.MIDLAND, Texas Midland is the county seat of Midland CountyGR6 located on the Southern Plains of the western area of the U.S. State of Texas. As of the 2006 U.S. Census estimate, the city had a total population of 102,073. -- Clayton Williams Clayton Wheat Williams, Jr. (b. 1931), a businessman from Midland, Texas, was the unsuccessful Republican gubernatorial nominee in 1990 against the Democratic State Treasurer Dorothy Ann Willis Richards even though he initially led in opinion polls by twenty points. Energy, Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :CWEI CWEI Combat Warfare Electronic Intelligence ) reported net income for the third quarter of 2007 of $986,000, or $.09 per share, as compared to net income of $5.3 million, or $.48 per share, for the third quarter of 2006. Cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses for the third quarter of 2007 was $72.4 million, as compared to $39.4 million during the same period in 2006. For the nine months ended September 30, 2007, the Company reported a net loss of $2.5 million, or $.22 per share, as compared to net income of $26.7 million, or $2.38 per share, for the same period in 2006. Cash flow from operations for the nine-month period in 2007 was $162.3 million, as compared to $116.5 million during the same period in 2006. Oil and gas sales increased 38% from $61.5 million for the third quarter of 2006 to $84.6 million for the same quarter in 2007 due primarily to higher production volumes. Gas production increased 54% to 5.8 Bcf, or 62,500 Mcf per day, from 3.7 Bcf, or 40,630 Mcf per day, in the 2006 quarter. Oil production for the third quarter of 2007 increased 9% to 582,000 barrels, or 6,326 barrels per day Barrels per day (abbreviated BPD, bbl/d, bpd, bd or b/d) is a measurement used to describe the amount of crude oil (measured in barrels) produced or consumed by an entity in one day. , compared to 532,000 barrels, or 5,783 barrels per day, in the 2006 quarter. The increase in gas production was attributable primarily to recent drilling activity in North and South Louisiana. For the third quarter of 2007, average realized gas prices increased 8% to $6.77 per Mcf from $6.26 per Mcf in the same quarter of 2006, while oil prices increased 7% to $72.10 per barrel from $67.27 per barrel in the 2006 period. Average realized prices for 2007 and 2006 exclude the effects of any gains or losses realized on commodity hedging transactions since those derivatives were not designated as cash flow hedges A cash flow hedge is a hedge of the exposure to the variability of cash flow that
For the third quarter of 2007, the Company reported a $2.3 million net loss on derivatives, consisting of a $1.6 million realized gain Realized Gain A gain resulting from selling an asset at a price higher than the original purchase price. Notes: There may be tax consequences for a realized profit. on settled contracts and a $3.9 million non-cash loss to mark the Company's derivative positions to their fair value on September 30, 2007. For the same period in 2006, the Company reported a $26.7 million net gain on derivatives, consisting of a $1.7 million realized loss Realized Loss A loss recognized when assets are sold for a price lower than the original purchase price. Notes: A portion of the realized loss may be applied against a capital gain or realized profit to reduce taxes. on settled contracts and a $28.4 million non-cash gain due to changes in mark-to-market valuations. Exploration costs related to abandonments and impairments were $18.8 million during the third quarter of 2007 compared to $19.7 million in the third quarter of 2006. The 2007 costs included $3.8 million for the abandonment of the CL&F #1 (Vanessa) in South Louisiana, $2.6 million for the partial abandonment of the Margarita No. 1 in our East Texas Bossier Bossier may refer to:
The Company reported that it incurred expenditures for exploration and development activities of $184.3 million during the nine months ended September 30, 2007 and has increased its estimates for capital expenditures in fiscal 2007 from $235.1 million to $251.4 million. Most of the $16.3 million increase relates to developmental drilling in the oil-prone regions of the Austin Chalk (Trend) and the Permian Basin The Permian Basin is a sedimentary basin largely contained in the western part of the U.S. state of Texas. It reaches from just south of Lubbock, Texas, to just south of Midland & Odessa, extending westward into the southeastern part of the adjacent state of New Mexico. . Based on these revised estimates, developmental drilling for fiscal 2007 will account for approximately 48% of the Company's capital spending capital spending Spending for long-term assets such as factories, equipment, machinery, and buildings that permits the production of more goods and services in future years. , as compared to 16% in fiscal 2006. The Company recorded a 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. during the third quarter of 2007 of $8 million for impairments pursuant to Statement of Financial Accounting Standards No. 144 "Accounting for Impairment or Disposal of Long-Lived Assets," of which $5.1 million related to the write-down of two 2,000 horsepower drilling rigs and related components to their estimated fair market value. The remaining $2.9 million impairment related to producing properties in West Texas. Operationally, the Company reported that it was currently fishing for a downhole motor in the wellbore of the Big Bill Simpson For the football player of the same name see Bill Simpson (American football). Bill Simpson (born March 14, 1940, Hermosa Beach, California), is a retired American racecar driver, but is best known as a pioneer in the racing safety business with his company Simpson No. 1, a Bossier wildcat test in Leon County, Texas Leon County is a county located in the U.S. state of Texas. In 2000, its population was 15,335. Its seat is Centerville6. Geography According to the U.S. Census Bureau, the county has a total area of 2,798 km² (1,080 mi²). . Once the motor is removed from the wellbore, the Company plans to continue with completion operations. To date, the Company has incurred approximately $10.7 million of drilling and completion costs, net to its 70% working interest. The Company is currently waiting on a rig to begin completion operations on the Margarita No. 1 in Robertson County, Texas Robertson County is a county located in the U.S. state of Texas. It forms part of the College Station-Bryan Metropolitan Statistical Area. In 2000, its population was 16,000. Its seat is Franklin6. The county is named for Sterling C. in the upper Bossier formation. As previously announced, the targeted middle Bossier formation was not productive in this well. To date, the Company has incurred $11.9 million in drilling costs, net of $2.6 million of costs which were charged to expense in the third quarter related to the abandonment of the middle Bossier formation. The Company owns 100% of the working interest in this well. The Company is continuing to negotiate with prospective buyers for the sale of some or all of its assets in South Louisiana. If no acceptable offers are received, the Company plans to retain the assets and continue selling the related production in the ordinary course of business. The Company will host a conference call to discuss these results and other forward-looking items today, November 7th at 12:00 p.m. CT (1:00 p.m. ET). The dial-in conference number is: 800-901-5213, passcode 59844895. The replay will be available for one week at 888-286-8010, passcode 82383961. To access the conference call via Internet webcast, please go to the Investor Relations Investor relations The process by which the corporation communicates with its investors. section of the Company's website at www.claytonwilliams.com and click on "Live Webcast." Following the live webcast, the call will be archived for a period of 90 days on the Company's website. Clayton Williams Energy, Inc. is an independent energy company located in Midland, Texas. Except for historical information, statements made in this release are 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. These statements are based on assumptions and estimates that management believes are reasonable based on currently available information; however, management's assumptions and the Company's future performance are subject to a wide range of business risks and uncertainties, and there is no assurance that these goals and projections can or will be met. Any number of factors could cause actual results to differ materially from expectations, volatility of oil and gas prices, the need to develop and replace reserves, the substantial capital expenditures required to fund operations, exploration risks, uncertainties about estimates of reserves, competition, government regulation, costs and results of drilling new projects, and mechanical and other inherent risks associated with oil and gas production. These risks and uncertainties are described in the Company's filings with the Securities and Exchange Commission. The Company undertakes no obligation to publicly update or revise any forward-looking statements. TABLES AND SUPPLEMENTAL INFORMATION FOLLOW . . . [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] |
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