Coho Energy announces record year end oil and gas reserves and improved financial results.DALLAS--(BUSINESS WIRE)--March 5, 1997--Coho Energy Inc. (NASDAQ-NMS: COHO; TSE See Tokyo Stock Exchange. TSE 1. See Tokyo Stock Exchange (TSE). 2. See Toronto Stock Exchange (TSE). : CEE cee n. The letter c. ) today reported that its 1996 year end proved oil and gas reserves rose 10% to record levels, representing a 237% replacement of production during the year. The company also announced improved financial results for the quarter and year ended Dec. 31, 1996. Proved Reserves proved reserves The quantity of minerals expected to be recoverable under current economic and operating conditions. The amount of proved reserves is important in valuing the stock of a company with significant holdings in natural resources. and Production Coho's proved reserves at Dec. 31, 1996 rose 10% to a record 34.8 million barrels of oil and 113.1 billion cubic feet of natural gas from 30.8 million barrels of oil and 107.9 billion cubic feet of gas at Dec. 31, 1995. In taking account of the year's production of 2.5 million barrels of oil and 6.6 billion cubic feet of gas the increase in reserves was 17% on a barrel of oil equivalent The barrel of oil equivalent (bboe, sometimes BOE) is a unit of energy based on the approximate energy released by burning one barrel of crude oil. The US Internal Revenue Service defines it as equal to 5.8 × 106 BTU [1]. 5. basis. The increase in oil reserves Oil reserves refer to portions of oil in place that are claimed to be recoverable under economic constraints. Oil in the ground is not a "reserve" unless it is claimed to be economically recoverable, since as the oil is extracted, the cost of recovery increases incrementally reflects Coho's continuing success in its Mississippi Mississippi, state, United States Mississippi (mĭs'əsĭp`ē), one of the Deep South states of the United States. It is bordered by Alabama (E), the Gulf of Mexico (S), Arkansas and Louisiana, with most of the border formed by exploitation and exploration program. Significant reserve increases were recorded from newly drilled wells and workover programs in the company's Brookhaven Brookhaven. 1 City (1990 pop. 10,243), seat of Lincoln co., SW Miss.; inc. 1859. It is situated in a dairy, timber, and farm area. Oil and gas fields are nearby. The city's manufactures include wood products, apparel, lumber, wire cloth, and asphalt. and Martinville fields, as well as waterflood Wa´ter`flood` n. 1. A flood of water; an inundation. projects in the Martinville and Soso SOSO Same Old Same Old SOSO Stability Operations and Support Operations SOSO Spouse or Significant Other SOSO State Owned, State Operated fields. The increase in gas reserves was a result of improved well performnce and the favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. impact of high commodity prices on the company's long lived Monroe field. Year end reserve value, using a 10% discount rate on future net cash flows of $819.9 million, was $417.1 million, representing a 55% increase over the $268.6 million reported at year end 1995. The substantial increase in value is attributable to the increase in reserve volumes and stronger year-end commodity prices. Total net daily production in 1996 averaged 9,769 barrels of oil equivalent (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 ) a 6% increase over 1995. Coho's Mississippi production was 6,877 BOE per day for 1996 versus 6,108 BOE in 1995. Fourth quarter 1996 daily BOE production in Mississippi was 7,177, a 5% increase over the third quarter of 1996. Coho's daily production in Louisiana Louisiana (ləwē'zēăn`ə, l  ē'–), state in the S central United States. It is bounded by Mississippi, with the Mississippi R. , which is all natural gas, was 2,892 BOE during 1996, a 7%
decrease from 1995.Production gains were recorded in the Martinville, Brookhaven, Summerland and Soso fields during 1996 as a result of an active drilling program, secondary recovery projects and an extensive recompletion program. Production in Laurel Laurel, cities, United States Laurel. 1 Town (1990 pop. 19,438), Prince Georges co., central Md., about halfway between Washington, D.C., and Baltimore; patented in the late 1600s, inc. 1870. was down slightly for the year, however the produuction has recovered during the first quarter of 1997 as a result of improvements in the Rodessa waterflood project. Gas sales at Monroe have experienced some interruptions during the year due to cold weather and operational difficulties with the gathering system during the rainy rain·y adj. rain·i·er, rain·i·est Characterized by, full of, or bringing rain. rain  i·ness n.Adj. season, but production capacity remains at approximately 19 million cubic feet per day. Financial Results The company also reported 1996 net income of $5.9 million ($0.29) as compared with 1995 earnings, after provision for preferred share dividends, of $836,000 ($0.05 per share). Net income from 1995 included $1.6 million of earnings from the company's discontinued dis·con·tin·ue v. dis·con·tin·ued, dis·con·tin·u·ing, dis·con·tin·ues v.tr. 1. To stop doing or providing (something); end or abandon: gas marketing and transportation operations, which were sold in April 1996. 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 (before working capital adjustments) in 1996 reached $26.4 million ($1.29 per share) an increase of 38% from $19.2 million ($1.02 per share) in 1995. For the three months ended December 31, 1996, Coho reported earnings of $2.4 million ($0.12 per share) versus $2.0 million ($0.10 per share) in the same period in 1995. Fourth quarter 1995 earnings included $1.2 million of income from discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. . Cash flow from operations (before working capital adjustments) in the fourth quarter of 1996 was $8.1 million ($0.39 per share) as compared with $7.2 million ($0.36 per share) in the same quarter of 1995. The improvement in fourth quarter and full year earnings was due to increased oil production and higher oil and gas prices. Capital expenditures during the year were $52.4 million, which included $6.5 million for exploration. The 3D seismic program at Laurel, covering approximately 34 square miles A square mil is a unit of area, equal to the area of a square with sides of length one mil. A mil is one thousandth of an international inch. This unit of area is usually used in specifying the area of the cross section of a wire or cable. , was completed in 1996 and will be the driving force of the exploration program in the latter part of 1997. The company has set a 1997 capital budget of $44 million to continue the exploration and exploitation of the company's properties in the Mississippi salt basin. Exploration activities are expected to account for 20% of the 1997 program. -0-
COHO ENERGY INC.
SUMMARY OF FINANCIAL RESULTS
(In Thousands, Except Per Share Data)
Three Months Twelve Months
Ended Ended
December 31, December 31,
1996 1995 1996 1995
Oil production (BBL/D) 6,994 6,371 6,742 5,966
Gas production (MCF/D) 18,384 18,542 18,160 19,431
Production (BOE/D) 10,058 9,461 9,769 9,205
Average Sales Price
$/BBL 17.66 13.65 16.42 13.62
$/MCF 2.40 1.81 2.07 1.59
Operating Revenues
Net oil and gas
production $15,415 $11,083 $54,272 $40,903
Operating Expenses
Oil and gas production 3,027 2,535 11,277 10,514
Taxes on oil and gas
production 609 512 2,598 1,943
General and
Administrative 2,185 1,076 7,264 5,400
Depletion and
Depreciation 4,237 3,439 16,280 14,717
Total Operating Expenses 10,058 7,562 37,419 32,574
Interest Expense (1,741) (2,194) (7,464) (8,048)
Income Taxes 1,174 510 3,483 112
Income from discontinued
operations -- 1,155 -- 1,611
Net earnings 2,442 1,972 5,906 1,780
Dividends on preferred
Stock -- -- -- (944)
Net earnings applicable
to common stock $2,442 $1,972 $5,906 $836
Earnings (loss) from
continuing operations
per share $0.12 $0.04 $0.29 $(0.02)
Earnings per common share $0.12 $0.10 $0.29 $ 0.05
Cash flow from operating
activities $8,119 $7,244 $26,351 $19,227
Cash flow per common share $ 0.39 $ 0.36 $ 1.29 $ 1.02
Weighted average number
of common shares
equivalents 20,650 20,165 20,457 17,932
Coho Energy Inc.
Condensed Consolidated Balance Sheet
December 31
(In Thousands)
1996 1995
ASSETS
Current Assets 17,618 $25,742
Property and Equipment 210,212 175,899
Other 2,211 2,401
$230,041 $204,042
Liabilities and Shareholders' Equity
Current liabilities 10,956 11,309
Long Term Debt 122,777 107,403
Deferred Income Taxes 14,842 11,009
148,575 129,721
Shareholders' Equity 81,466 74,321
$230,041 $204,042
Common shares outstanding 20,347 20,165
-0-
CONTACT: Coho Energy Inc. Jeffrey Clarke Chairman and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. Anne Marie O'Gorman Senior Vice President 972/774-8300 |
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