For further information contact John S. Weatherly, CFO 1-800-451-1294
FOR IMMEDIATE RELEASE
Natchez, MS (August 7, 2002)-Callon Petroleum Company (NYSE: CPE/CPE.PrA) today reported its results of operations for both the quarter and the six-month period ended June 30, 2002.
Results for the three-month period ended June 30, 2002 include net income of $2.3 million, or $0.15 per diluted share. This compares to net income of $3.5 million, or $0.23 per share on a diluted basis, for the same period in 2001. Total revenues for the three-month period ended June 30, 2002 were $20.1 million compared to $17.7 million for the same period in 2001.
Operating results for the three-month period ended June 30, 2002 include oil and gas sales of $15.3 million from average production of 43 million cubic feet of natural gas equivalent per day (MMcfe/d). This corresponds to sales of $17.1 million from average daily production of 43 MMcfe/d during the same period in 2001. During the second quarter of 2002, natural gas represented approximately 90 percent of the company's total production. The average price received per thousand cubic feet of natural gas in the second quarter of 2002 decreased by 25 percent to $3.25 compared to $4.34 during the second three months in 2001, while the average price received per barrel of oil in the second quarter of 2002 decreased by 5 percent to $23.41 compared to $24.70 during the same period a year earlier.
For the six months ended June 30, 2002, the company reported a net loss of $113,000, or $0.06 per diluted share. This compares to net income of $9.6 million, or $0.65 per share on a diluted basis, for the same period in 2001. Total revenues for the six-month period ended June 30, 2002 were $31.3 million compared to $38.5 million for the first six months in 2001.
Callon Petroleum Company is engaged in the exploration, development, acquisition and operation of oil and gas properties primarily in the Gulf Coast region.
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Consolidated Statements of Operations:
(In thousands, except per share amounts)
Three Months Ended Six Months Ended
June 30, June 30,
2002 2001 2002 2001
______________________________________________
Revenues:
Oil and gas sales $ 15,304 $ 17,066 $ 26,358 $ 37,243
Loss on mark-to-market commodity
derivative contracts (382) -- (770) --
Interest and other 252 646 822 1,281
Gain on sale of pipeline 2,454 -- 2,454 --
Gain on sale of Enron derivatives 2,479 -- 2,479 --
________ ________ _________ ________
Total revenues 20,107 17,712 31,343 38,524
________ ________ _________ ________
Costs and expenses:
Lease operating expenses 2,805 3,052 5,369 5,725
Depreciation, depletion and amortization 6,489 5,154 12,077 10,051
General and administrative 1,299 1,579 2,438 2,702
Interest 5,913 2,613 11,633 5,234
________ ________ _________ ________
Total costs and expenses 16,506 12,398 31,517 23,712
________ ________ _________ ________
Income (loss) from operations 3,601 5,314 (174) 14,812
Income tax expense (benefit) 1,260 1,860 (61) 5,184
________ ________ _________ ________
Net income (loss) 2,341 3,454 (113) 9,628
Preferred stock dividends 319 319 638 638
________ ________ _________ ________
Net income (loss) available to common shares $ 2,022 $ 3,135 $ (751) $ 8,990
======== ======== ========= ========
Net income (loss) per common share:
Basic $ 0.15 $ 0.24 $ (0.06) $ 0.68
======== ======== ========= ========
Diluted $ 0.15 $ 0.23 $ (0.06) $ 0.65
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Shares used in computing net income (loss)
per common share:
Basic 13,334 13,258 13,325 13,255
======== ======== ========= ========
Diluted (1) 13,744 13,427 13,325 14,853
======== ======== ========= ========
(1) Diluted shares for the six months ended June 30, 2001 includes 1,366,000 shares of common
stock because of the dilutive impact of the convertible preferred stock in the first half of 2001.
The assumed conversion of the preferred stock was not included in any other diluted calculation
presented due to its anti-dilutive impact on earnings per share.
Consolidated Condensed Balance Sheets:
(In thousands)
June 30, December 31,
2002 2001
_______ ___________
Cash and cash equivalents $ 14,880 $ 6,887
Oil and gas properties, net 367,210 343,158
All other assets 19,999 22,050
_________ __________
Total assets $ 402,089 $ 372,095
========= ==========
Long-term debt $ 242,306 $ 199,078
All other liabilities 14,508 25,793
Stockholders' equity 145,275 147,224
_________ __________
Total liabilities and stockholders' equity $ 402,089 $ 372,095
========= ==========
Other Financial Information:
(In thousands, except per share amounts)
Three Months Ended Six Months Ended
June 30, June 30,
2002 2001 2002 2001
____ ____ ____ ____
(1) (1)
Net cash flow from operations before changes
in current assets and liabilities $ 5,010 $ 11,104 $ 5,815 $ 25,995
Net cash flow per share $ 0.33 $ 0.75 $ 0.39 $ 1.75
Weighted average shares outstanding 15,110 14,793 15,047 14,853
(1) Excludes gain on sale of pipeline and
Enron derivatives
Production and Price Information:
Production:
Oil (MBbls) 60 69 114 120
Gas (MMcf) 3,565 3,536 6,594 6,980
Gas equivalent (MMcfe) 3,925 3,950 7,278 7,701
Average daily (MMcfe) 43.1 43.4 40.2 42.5
Average prices:
Oil ($/Bbl) $23.41 $24.70 $21.16 $ 25.52
Gas ($/Mcf) 3.25 4.34 2.83 4.90
Gas equivalent ($/Mcfe) 3.31 4.32 2.90 4.84
Third Quarter and Full Year 2002
Guidance Estimates
(In thousands, except per production unit amounts)
Guidance for 3rd Guidance for
Quarter 2002 Full Year 2002
Description:
Production volumes (MMcfe/d) 43-46 42 - 45
Percent Natural Gas 93% 92%
Average costs (per Mcfe):
Lease operating expense $0.73 - $0.69 $0.71 - $0.68
General and administrative expense $0.28 - $0.27 $0.30 - $0.29
Interest expense $1.79 - $1.68 $1.64 - $1.56
Non-cash expenses included above $0.51 - $0.48 $0.46 - $0.44
DD&A $1.64 $1.64
Volumetric production payment:
Committed volume (MMcf) N/A 1,160.3
Effective price (per Mcf) N/A $2.08
Fixed Delivery Contract:
Committed volume (MMcf) 690 1,605
Effective price (per Mcf) $3.26 $3.26
Effective tax rate 35% 35%
Share data:
Basic weighted average shares 13,400 13,400
Diluted impact of stock options, warrants 650 525
Diluted impact of convertible preferred stock 1,366 1,366
The preceding guidance estimates contain assumptions that we believe are reasonable. These
estimates are based on information that is available as of the date of this news release. We are
not undertaking any obligation to update these estimates as conditions change or as additional
information becomes available.
This news release contains projections and other 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 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 include:
- general economic conditions;
- volatility of oil and natural gas prices;
- uncertainty of estimates of oil and natural gas reserves;
- impact of competition;
- availability and cost of seismic, drilling and other equipment;
- operating hazards inherent in the exploration for and production of oil and natural gas;
- difficulties encountered during the exploration for and production of oil and natural gas;
- difficulties encountered in delivering oil and natural gas to commercial markets;
- changes in customer demand and producers' supply;
- uncertainty of our ability to attract capital;
- compliance with, or the effect of changes in, the extensive governmental regulations
regarding the oil and natural gas business;
- actions of operators of our oil and gas properties;
- weather conditions; and
- the risk factors discussed in our filings with the Securities and Exchange Commission,
including those in our Annual Report for the year ended December 31, 2001 on
Form 10-K.
The preceding estimates reflect our review of continuing operations only. These estimates do not take into account any material transactions such as sales of debt and equity securities, acquisitions or divestitures of assets, and formations of joint ventures. We continually review these types of transaction and may engage in one or more of these types of transactions without prior notice.
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