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SEAGULL ENERGY CORPORATION REPORTS FIRST QUARTER RESULTS

 SEAGULL ENERGY CORPORATION REPORTS FIRST QUARTER RESULTS
 HOUSTON, April 27 /PRNewswire/ -- Seagull Energy Corporation


(NYSE: SGO) today reported earnings applicable to common stock of $2.9 million, or 23 cents per share, for the first quarter of 1992. The company had revenues of $67.5 million and operating profit of $6.9 million for the period.
 In the same quarter of 1991, Seagull's earnings applicable to common stock totaled $6.2 million, or 55 cents per share, on revenues of $73.1 million. Operating profit was $12.7 million in 1991's first quarter.
 Net cash provided by operating activities before changes in operating assets and liabilities totaled $20.4 million for the 1992 quarter, up slightly from $19.6 million in the prior-year period.
 Results for the 1992 quarter include the cumulative effect, as of Jan. 1, 1992, of two changes in accounting principles netting to an increase in earnings of $2.3 million, or 18 cents per share. The company's implementation of SFAS No. 109 dealing with accounting for income taxes increased earnings by $3.0 million. Seagull's adoption of SFAS No. 106 related to accounting for postretirement benefits other than pensions reduced earnings by $0.7 million.
 "A major reason for the current quarter's disappointing results was natural gas prices," noted Seagull Chairman Barry J. Galt. "They were marginally acceptable in January, but fell to thoroughly unsatisfactory levels in February before some slight improvement in March.
 "Because prices fell so precipitously, we curtailed our gas production to our 'irreducible minimum' (approximately 60 to 70 percent of full deliverability) for the last two months of the quarter," Galt added. "We remain steadfast in our long-standing policy of refusing to produce at full deliverability when prices are unsatisfactory."
 Due to the combined effect of lower gas production and prices, plus lower prices for crude oil and condensate and higher depletion charges, Seagull's E&P segment registered an operating loss of $4.2 million for the 1992 quarter. Operating profit in the Alaska Transmission and Distribution segment was essentially unchanged, whereas contributions from the pipeline operations segment declined, principally due to the absence of a construction profit recognized in the 1991 quarter.
 Interest charges were higher in the 1992 period because of increased debt related to a large March 1991 acquisition of Mid-Continent reserves and producing properties. Employee-related costs were higher due to an increase in employment related to the 1991 acquisition and to $400,000 in severance expenses incurred when the company reduced its non-Alaska workforce more than 10 percent during 1992's first quarter. On an annualized basis, however, the workforce reduction is expected to result in pre-tax savings of about $1.4 million.
 "In the face of steadily growing demand for natural gas and the declines in deliverability that are inevitable because of low current drilling levels, we remain optimistic about the long-term outlook for gas," Galt declared. "If our first quarter gas price and production rate continued throughout all of 1992, it is not likely that we will report net earnings for the full year. On the other hand, we've been encouraged by recent gas price increases. There is no assurance, of course, that the current favorable trend will continue for the rest of the year, but prospects seem brighter for the moment at least.
 "Generating cash flow (net cash provided by operating activities before changes in operating assets and liabilities) in 1992 equal to that realized in 1991 is an achievable goal," he added. "For sure, we are determined that 1992 cash flow will be sufficient to cover the company's planned capital spending and interest costs."
 SEAGULL ENERGY CORPORATION
 Consolidated First Quarter Results (Unaudited)
 (Dollars in Thousands Except Share and Per-Share Amounts)
 Three months ended March 31, 1992 1991
 Revenues $67,533 $73,120
 Operating profit $6,854 $12,747
 Net cash provided by operating activities
 Before changes in operating assets and
 liabilities $20,412 $19,612
 Net cash provided by operating activities $4,766 $18,792
 Net earnings before cumulative effect of
 changes in accounting principles $669 $6,172
 Earnings applicable to common stock $2,942 $6,172
 Per share:
 Net earnings before cumulative effect of
 changes in accounting principles $0.05 $0.55
 Earnings applicable to common stock $0.23 $0.55
 Weighted average common shares outstanding 12,782,040 11,216,567
 BUSINESS SEGMENT INFORMATION
 Financial Data (Dollars in Thousands)
 (Unaudited)
 Three month ended March 31, 1992 1991
 Revenues:
 Exploration and production 21,425 15,384
 Pipeline operations 8,652 10,216
 Alaska Transmission and Distribution 37,456 47,520
 Operating Profit (Loss):
 Exploration and production (4,172) 1,407
 Pipeline operations 1,661 2,038
 Alaska Transmission and Distribution 9,365 9,302
 Operations Data
 Exploration and Production
 Net daily production:
 Natural gas (Mcf) 114,005 68,261
 Oil and condensate (Bbl) (A) 3,887 2,761
 Average sales prices:
 Natural gas ($ per Mcf) 1.55 1.71
 Oil and condensate ($ per Bbl) 15.24 18.68
 Pipeline Operations
 Pipeline margins (Dollars in Thousands):
 Gathering sales margin 117 170
 Transportation fees 1,460 1,699
 Marketing sales (B) 578 534
 Pipeline margins 2,155 2,403
 Average Daily Pipeline Volumes (MMcf):
 Gas gathering 173 225
 Gas marketing 159 181
 Partnership systems (net) 96 99
 Matagorda Gas Processing Plant:
 Average daily inlet volumes (MMcf) 246 258
 Average daily net production (Bbl) 3,402 3,551
 Average NGL sales price (cents per gallon) 27.3 29.2
 Alaska Transmission and Distribution
 Degree days 4,056 4,053
 Volume of gas delivered (MMcf) 13,388 13,631
 (A) Includes net daily natural gas liquids production of 766 barrels for the 1992 quarter and 350 barrels for the 1991 quarter.
 (B) Gas marketing sales net of gas costs and transportation expenses.
 -0- 4/27/92
 /CONTACT: Alan Payne of Seagull Energy Corporation, 713-951-4700/
 (SGO) CO: Seagull Energy Corporation ST: Texas IN: OIL SU: ERN


SM -- NY087 -- 3216 04/27/92 13:19 EDT
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