Rodger W. Smith 1-800-451-1294
Callon Petroleum Company Reports First Quarter 2006 Results of
Operations
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
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 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 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. 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, 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 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 of an oil
and gas exploration and production company’s ability to internally fund
exploration and development activities and to service or incur additional
debt. The company also has included this
information because changes in operating assets 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 |
||
|
(In
thousands)
|
March 31, |
||
|
|
2006 2005 |
||
Discretionary cash flow |
$33,780 |
|
$31,414 |
|
Net working capital changes and other changes |
7,236 |
|
(10,083) |
|
Net cash flow provided by operating activities |
$41,016 |
|
$21,331 |
|
Consolidated Condensed Balance Sheets: |
March 31 |
December 31 |
|
(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 |
|
Total assets |
$585,964 |
$533,776 |
|
|
|
|
|
Long-term debt excluding current maturities |
$194,218 |
$188,813 |
|
All other liabilities |
148,677 |
116,915 |
|
Stockholders’ equity |
243,069 |
228,048 |
|
Total liabilities
and stockholders’ equity |
$585,964 |
$533,776 |
|
Production and Price Information: |
Three Months Ended |
|
|
|
March 31,
|
|
|
|
2006 |
2005 |
|
Production: |
|
|
|
Oil (MBbls) |
515 |
641 |
|
Gas (MMcf) |
1,950 |
2,748 |
|
Total Production
(MMcfe) |
5,042 |
6,593 |
|
Average daily (MMcfe) |
56.0 |
73.3 |
|
|
|
|
|
Average prices: |
|
|
|
Oil ($/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) |
|
Average realized oil price |
$53.95 |
$37.46 |
|
|
|
|
|
|
|
|
Callon Petroleum Company
Consolidated Statements of Operations
(Unaudited)
(In thousands, except share amounts)
|
|
Three Months Ended |
||
|
|
March 31, |
||
|
|
2006 |
|
2005 |
|
|
Operating revenues: |
|
|
|
|
|
Oil and gas sales |
$
45,581 |
|
$
43,012 |
|
|
|
|
|
|
|
|
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 |
|
|
Total operating
expenses |
22,976 |
|
24,878 |
|
|
|
|
|
|
|
|
Income from operations |
22,605 |
|
18,134 |
|
|
Other (income)
expenses: |
|
|
|
|
|
Interest expense |
4,148 |
|
4,569 |
|