Clayton Williams Energy Inc. Announces Third Quarter Earnings
MIDLAND, Texas, Nov 4, 2003 -- Clayton Williams
Energy Inc. (Nasdaq:CWEI) today reported net income for the third
quarter of 2003 of $7.6 million, or $.79 per share, as compared to a
net loss of $970,000, or $.10 per share, for the third quarter of
2002. Cash flow from operations was $29.2 million compared to $5.5
million during the same period in 2002.
For the nine months ended September 30, 2003, the Company reported
net income of $30.2 million, or $3.19 per share, compared to a net
loss of $2.6 million, or $.29 per share, for the same period in 2002.
Cash flow from operations during the first nine months of 2003 was
$98.8 million compared to $20.2 million in 2002.
A 58% increase in gas prices and higher gas production were the
main contributors to the increase in earnings for the current quarter.
For the third quarter 2003, oil and gas sales increased 71% to $38
million, as compared to $22.2 million in 2002. Realized gas prices
increased from $2.80 to $4.41, and oil prices increased 17% from
$23.52 to $27.53. The 2003 prices include realized net losses on
hedging transactions totaling $3.1 million, or $.43 per Mcf of gas and
$1.42 per Bbl of oil, as compared to net hedging losses of $2.6
million, or $.23 per Mcf of gas and $3.97 per Bbl of oil, for the same
period in 2002.
Gas production for the third quarter increased 31% to 5.8 Bcf, or
63,293 Mcf per day, from 4.4 Bcf, or 48,217 Mcf per day, in 2002. This
increase was derived primarily from the Cotton Valley Reef Complex and
from South Louisiana. Oil and natural gas liquids (NGL) production for
the 2003 quarter remained relatively consistent compared to 2002.
Abandonments and impairments totaled $4 million for the third
quarter of 2003, as compared to $6.6 million in 2002. Included in the
2003 period were $1.9 million of costs related to prospects in
Plaquemines Parish, La., and $1.4 million related to the Cotton Valley
Reef Complex.
The Company will host a conference call to discuss the results and
other forward-looking items on Wednesday, Nov. 5, at 1:30 p.m. CT
(2:30 p.m. ET). The dial-in conference number is: 800-299-8538,
passcode 78102099. The replay will be available for one week at
888-286-8010, passcode 27348831.
To access the Internet webcast, please go to the Company's Web
site 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 Web site.
Clayton Williams Energy Inc. is an independent energy company
located in Midland, Texas.
Certain statements contained herein constitute "forward-looking
statements" within the meaning of the Private Securities Litigation
Reform Act of 1995 (the "Reform Act"). Such forward-looking statements
involve known and unknown risks, uncertainties and other factors that
may cause the actual results, performance or achievements of the
Company to be materially different from any future results,
performance or achievements expressed or implied by such
forward-looking statements. Such factors include, among others, the
following: the volatility of oil and gas prices, the Company's
drilling results, the Company's ability to replace short-lived
reserves, the availability of capital resources, the reliance upon
estimates of proved reserves, operating hazards and uninsured risks,
competition, government regulation, the ability of the Company to
implement its business strategy, and other factors referenced in the
Company's public filings with the Securities and Exchange Commission.
TABLES AND SUPPLEMENTAL INFORMATION FOLLOW . . .
CLAYTON WILLIAMS ENERGY INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share)
Three Months Ended Nine Months Ended
September 30, September 30,
--------------------- ---------------------
2003 2002 2003 2002
---------- ---------- ---------- ----------
REVENUES
Oil and gas sales $38,039 $22,227 $129,785 $59,642
Natural gas services 2,202 1,151 6,504 3,768
---------- ---------- ---------- ----------
Total revenues 40,241 23,378 136,289 63,410
---------- ---------- ---------- ----------
COSTS AND EXPENSES
Lease operations 7,227 5,103 21,477 15,123
Exploration:
Abandonments and
impairments 3,953 6,565 17,347 15,308
Seismic and other 1,481 2,242 5,445 5,852
Natural gas services 2,075 1,115 6,064 3,290
Depreciation, depletion
and amortization 10,055 7,646 31,279 21,472
Impairment of property
and equipment 170 -- 170 --
Accretion of abandonment
obligations 171(a) -- 477(a) --
General and
administrative 2,039 2,076 6,969 5,899
---------- ---------- ---------- ----------
Total costs
and expenses 27,171 24,747 89,228 66,944
---------- ---------- ---------- ----------
Operating
income (loss) 13,070 (1,369) 47,061 (3,534)
---------- ---------- ---------- ----------
OTHER INCOME (EXPENSE)
Interest expense (697) (1,082) (2,550) (2,934)
Gain (loss) on sales of
property and equipment (12) 14 201 83
Change in fair value of
derivatives 412 (428) 1,154 (1,088)
Other (1,239) 55 (1,356) 1,760
---------- ---------- ---------- ----------
Total other income
(expense) (1,536) (1,441) (2,551) (2,179)
---------- ---------- ---------- ----------
Income (loss) before
income taxes 11,534 (2,810) 44,510 (5,713)
Income tax expense
(benefit) 3,980 (644) 14,524 (1,742)
---------- ---------- ---------- ----------
Income (loss) from
continuing operations 7,554 (2,166) 29,986 (3,971)
Cumulative effect of
accounting change,
net of tax -- -- 207(a) --
Income from discontinued
operations, net of tax -- 1,196(b) -- 1,335(b)
---------- ---------- ---------- ----------
NET INCOME (LOSS) $7,554 $(970) $30,193 $(2,636)
========== ========== ========== ==========
Net income (loss) per
common share:
Basic:
Income (loss) from
continuing operations $0.81 $(0.23) $3.22 $(0.43)
========== ========== ========== ==========
Net income (loss) $0.81 $(0.10) $3.24 $(0.29)
========== ========== ========== ==========
Diluted:
Income (loss) from
continuing operations $0.79 $(0.23) $3.17 $(0.43)
========== ========== ========== ==========
Net income (loss) $0.79 $(0.10) $3.19 $(0.29)
========== ========== ========== ==========
Weighted average common
shares outstanding:
Basic 9,330 9,255 9,318 9,231
========== ========== ========== ==========
Diluted 9,565 9,255 9,463 9,231
========== ========== ========== ==========
Total comprehensive
income (loss) $14,105 $(4,664) $36,744 $(13,030)
========== ========== ========== ==========
CLAYTON WILLIAMS ENERGY INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands)
ASSETS
September 30, December 31,
2003 2002
-------------- --------------
CURRENT ASSETS
Cash and cash equivalents $10,706 $5,676
Accounts receivable:
Oil and gas sales, net 16,461 14,426
Joint interest and other, net 2,441 3,714
Affiliates 318 223
Inventory 1,332 2,141
Deferred income taxes 738 524
Fair value of derivatives 498 --
Prepaids and other 2,427 5,215
-------------- --------------
34,921 31,919
-------------- --------------
PROPERTY AND EQUIPMENT
Oil and gas properties, successful
efforts method 648,088 617,320
Natural gas gathering and processing
systems 16,708 16,203
Other 12,208 11,918
-------------- --------------
677,004 645,441
Less accumulated depreciation,
depletion and amortization (495,093) (466,815)
-------------- --------------
Property and equipment, net 181,911 178,626
-------------- --------------
OTHER ASSETS
Deferred income taxes -- 6,594
Investments and other 2,325 1,853
-------------- --------------
2,325 8,447
-------------- --------------
$219,157 $218,992
============== ==============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable:
Trade $19,284 $22,440
Oil and gas sales 10,275 8,274
Affiliates 1,139 1,257
Current maturities of long-term debt 1,303 --
Fair value of derivatives 2,308 12,917
Accrued liabilities and other 2,972 5,874
-------------- --------------
37,281 50,762
-------------- --------------
NON-CURRENT LIABILITIES
Long-term debt 54,453 94,949
Deferred income taxes 11,085 --
Fair value of derivatives 48 --
Other 9,831 4,500
-------------- --------------
75,417 99,449
-------------- --------------
STOCKHOLDERS' EQUITY:
Preferred stock, par value $.10 per
share -- --
Common stock, par value
$.10 per share 935 928
Additional paid-in capital 73,714 72,787
Retained earnings 33,209 3,016
Accumulated other comprehensive
income (loss) (1,399) (7,950)
-------------- --------------
106,459 68,781
-------------- --------------
$219,157 $218,992
============== ==============
CLAYTON WILLIAMS ENERGY INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
Three Months Ended Nine Months Ended
September 30, September 30,
------------------ ------------------
2003 2002 2003 2002
-------- -------- -------- --------
CASH FLOWS FROM OPERATING
ACTIVITIES
Net income (loss) $7,554 $(970) $30,193 $(2,636)
Adjustments to reconcile net
income (loss) to cash
provided by operating
activities:
Depreciation, depletion and
amortization 10,055 7,646 31,279 21,472
Exploration costs 3,953 6,565 17,347 15,308
Gain on sales of property
and equipment 12 (14) (201) (83)
Deferred income taxes 3,980 (644) 14,524 (1,742)
Non-cash employee
compensation 32 (178) 379 (247)
Change in fair value of
derivatives (756) 782 (981) 1,185
Accretion of abandonment
obligations 171 -- 477 --
Cumulative effect of
accounting change, net of
tax -- -- (207) --
Non-cash effect of
discontinued operations,
net of tax 170 (1,196) 170 (1,029)
Other 128 141 359 764
Changes in operating working
capital:
Accounts receivable 3,668 (2,502) (857) (4,182)
Accounts payable (4,454) (279) 5,551 (3,405)
Other 4,653 (3,812) 812 (5,229)
-------- -------- -------- --------
Net cash provided by
operating activities 29,166 5,539 98,845 20,176
-------- -------- -------- --------
CASH FLOWS FROM INVESTING
ACTIVITIES
Additions to property and
equipment (13,694) (24,668) (49,931) (58,635)
Proceeds from sales of
property and equipment (13) 3,200 236 7,325
Other (95) (36) (407) (105)
-------- -------- -------- --------
Net cash used in investing
activities (13,802) (21,504) (50,102) (51,415)
-------- -------- -------- --------
CASH FLOWS FROM FINANCING
ACTIVITIES
Proceeds from long-term
debt -- 9,940 -- 31,940
Repayments of long-term
debt (20,515) -- (43,956) --
Proceeds from sale of
common stock 139 36 243 36
Repurchase and cancellation
of common stock -- -- -- (648)
-------- -------- -------- --------
Net cash provided by
financing activities (20,376) 9,976 (43,713) 31,328
-------- -------- -------- --------
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS (5,012) (5,989) 5,030 89
CASH AND CASH EQUIVALENTS
Beginning of period 15,718 8,934 5,676 2,856
-------- -------- -------- --------
End of period $10,706 $2,945 $10,706 $2,945
======== ======== ======== ========
Clayton Williams Energy Inc.
Summary Production and Price Data
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
------------------ ------------------
2003 2002 2003 2002
-------- -------- -------- --------
Average Daily Production:
Natural Gas (Mcf):
Austin Chalk (Trend) 3,294 2,923 3,726 3,580
Cotton Valley Reef Complex 38,152 29,831 46,081 24,963
Louisiana 17,516 9,948 18,415 5,529
New Mexico/West Texas 1,877 1,727 1,778 1,795
Other 2,454 3,788 2,326 3,778
-------- -------- -------- --------
Total 63,293 48,217 72,326 39,645
======== ======== ======== ========
Oil (Bbls):
Austin Chalk (Trend) 2,825 3,195 2,821 3,468
Louisiana 541 283 598 152
New Mexico/West Texas 726 685 720 753
Other 125 54 84 45
-------- -------- -------- --------
Total 4,217 4,217 4,223 4,418
======== ======== ======== ========
Natural gas liquids (Bbls):
Austin Chalk (Trend) 437 500 283 482
New Mexico/West Texas 247 130 183 140
Other 207 11 168 8
-------- -------- -------- --------
Total 891 641 634 630
======== ======== ======== ========
Total Production:
Natural Gas (MMcf) 5,823 4,436 19,745 10,823
Oil (MBbls) 388 388 1,153 1,206
Natural gas liquids (MBbls) 82 59 173 172
-------- -------- -------- --------
Gas Equivalents (MMcfe) 8,643 7,118 27,701 19,091
Average Realized Prices:
Gas ($/Mcf):
Before hedging $4.84 $3.03 $5.52 $2.85
Hedging gain (loss) (0.43) (0.23) (0.76) (0.02)
-------- -------- -------- --------
Combined $4.41 $2.80 $4.76 $2.83
======== ======== ======== ========
Oil ($/Bbl):
Before hedging $28.95 $27.49 $29.93 $23.99
Hedging gain (loss) (1.42) (3.97) (2.45) (1.95)
-------- -------- -------- --------
Combined $27.53 $23.52 $27.48 $22.04
======== ======== ======== ========
Natural gas liquids ($/Bbl) $19.96 $13.42 $21.05 $12.78
======== ======== ======== ========
CLAYTON WILLIAMS ENERGY INC.
Notes to tables and supplemental information
(a) Effective January 2003, the Company adopted Statement of Financial
Accounting Standards ("SFAS") No. 143 "Accounting for Asset
Retirement Obligations".
(b) Pursuant to the requirements of SFAS No. 144 "Accounting for
Impairment or Disposal of Long-Lived Assets," the historical
operating results from the Wharton County properties, sold in
2002, have been reported as discontinued operations. Certain
adjustments have been made to conform with current period
presentations.
Certain reclassifications in 2002 have been made to conform to current
period presentations.
|
