FORT WORTH, Texas, Aug. 6 /PRNewswire/ -- Snyder Oil Corporation
(NYSE: SNY) today reported first half 1998 earnings of $214,000 (one cent per
share) compared to $1.1 million (four cents per share) in the same period of
1997. Discretionary cash flow of $36.5 million increased 20 percent compared
to last year's first half total of $30.5 million. Production growth of
28 percent coupled with a 17 percent reduction in per unit cash costs
outweighed a significant drop in commodity prices from $15.33 down to
$12.51 per barrel of oil equivalent.
Unless stated otherwise, all results in the text of this release compare
ongoing operations and exclude special items and the operations of the
Company's former majority owned subsidiary, Patina Oil & Gas Corporation,
which was sold at the end of the third quarter 1997. The accompanying tables
reflect both the historically reported amounts along with the amounts with the
special items segregated.
For the second quarter of 1998, the Company reported a net loss of
$777,000 (two cents per share) compared to net income of $1.6 million (five
cents per share) for the second quarter of 1997, including special items and
Patina's operations. Excluding special items and Patina's operations, the
Company incurred a net loss of $1.6 million (five cents per share) in the
second quarter of 1998 compared to a net loss of $3.7 million (12 cents per
share) in the second quarter of 1997. Also excluding special items and
Patina's operations, discretionary cash flow of $18.7 million increased by 90
percent compared to $9.9 million as the Company achieved a 55 percent increase
in natural gas production compared to 1997's second quarter.
Revenues for the second quarter 1998 increased 31 percent to
$34.6 million, despite the lowest oil prices since 1986. The increase is a
result of gas production growing to 158 from 102 million cubic feet per day in
the prior year quarter. This marks the Company's fourth consecutive quarterly
increase in gas production, reflecting successful development in the Gulf of
Mexico and continued long term, steady growth in the Rockies.
The Company's average realized gas price in the second quarter was $2.02
per thousand cubic feet (Mcf), up nine percent from $1.85 per Mcf in the
second quarter of 1997, driven by relatively strong prices in the Rockies.
Softer than expected Gulf gas prices were boosted by downstream gains which
added $.10 per Mcf to the Company's average realized gas price for the
quarter.
Average realized crude oil prices dropped 37 percent to $11.10 per barrel
in the second quarter from $17.60 in the prior year quarter. Crude oil and
condensate volumes declined five percent to 5,447 barrels per day. Oil
production comprised 17 percent of total equivalent production in the second
quarter, compared to 25 percent last year.
John C. Snyder, Chairman and Chief Executive Officer, commented, "We are
striving to deliver outstanding financial performance even during very
difficult periods. Major progress toward this is reflected in the significant
improvement in all three of our core areas compared to last year. We are
benefiting from increasing production in our core areas, a lower cost
structure and the fact that natural gas represents 83 percent of our product
mix."
Exploration during the quarter achieved four successes among five tests
spudded in the Gulf of Mexico with discoveries at Main Pass Block 260, Viosca
Knoll Blocks 780 and 824 (Specter prospect) and Mississippi Canyon Block 546
(Leo prospect). Subsequent to quarter end, the Scarab prospect in East Breaks
Block 208 was drilled without encountering sufficient hydrocarbons to justify
completion and was plugged and abandoned. Also, the Company subsea completed
a 100 percent owned South Timbalier 231 well that tested at 15 million cubic
feet of gas per day, which will begin production this month.
In the Main Pass area, subsequent to quarter end, the gas transport
bottleneck was resolved. The new Transco pipeline became operational August
1st, allowing SOCO to increase Main Pass gas production approximately
60 percent to 300 million cubic feet per day gross and 120 million cubic feet
per day net. With the new take away capacity in place, the Company has
brought its Main Pass 261 A-3 and A-5 wells on line and is planning to
complete the A-4 well later in the month.
"We expect our second half production from the Gulf of Mexico to increase
more than 50 percent compared to the first half of the year now that the
Transco pipeline is operational at Main Pass. With the additional volumes
being placed on production, we are confident in reaching our corporate target
of increasing production by 40 percent this year from our core properties
despite the one month delay in Transco coming online. Both the third and
fourth quarters should set records in total Company production levels from our
continuing operations," said William G. Hargett, President and Chief Operating
Officer. "Because of our increased cash flow, a solid balance sheet and a
strong technical team, we have been able to double our exploration and
development program this year. The Company's drilling success with these
programs should add sufficient reserves to sustain meaningful production
growth for several years."
Snyder Oil Corporation is engaged in the production, development,
acquisition and exploration of domestic oil and gas properties, primarily in
the Gulf of Mexico, the Rocky Mountains and northern Louisiana. The Company
also has investments in two international exploration and production
companies, SOCO International plc and Cairn Energy plc. The Company's shares
are traded on the New York Stock Exchange under the symbol "SNY." The
Company's news releases and other information can be found on the Internet at
http://www.snyderoil.com.
This release contains certain forward-looking statements which are based
on assumptions which the Company believes are reasonable, but which are
subject to a wide range of uncertainties and business risks. Factors that
could cause actual results to differ materially from those anticipated are
discussed in the Company's periodic filings with the Securities and Exchange
Commission, including its Annual Report on Form 10-K for the year ended
December 31, 1997.
SNYDER OIL CORPORATION
(In thousands, except per share and price data)
(Unaudited)
Six Months Ended June 30,
Excluding As
Patina Reported
1998 1997 1997
Oil and gas sales $67,403 $64,723 $116,836
Cash expenses
Direct operating 17,788 17,202 26,524
General and
administrative 8,306 8,201 10,812
Financing costs, net 5,669 4,584 13,069
Other (income) expense (894) 1,145 918
Preferred dividends -- 3,100 3,100
Discretionary cash flow 36,534 30,491 62,413
Depletion, depreciation
and amortization 25,687 21,196 45,972
Property impairments -- 625 625
Exploration 10,518 5,328 5,390
329 3,342 10,426
Current income tax
expense -- 500 500
Deferred income
tax expense 115 1,755 1,755
Net income before
special items 214 1,087 8,171
Special items (net of
deferred taxes)
Gains on sales of equity
interests in
investees -- 21,428 21,428
Gains on sales
of properties 847 3,148 3,148
Loss on sale of
subsidiary interest -- (6,500) (6,500)
Extraordinary item,
net of tax -- (2,848) (2,848)
Minority interest
in subsidiaries -- (615) (3,429)
Net income
applicable to common $1,061 $15,700 $19,970
Net income per
common share $.03 $.52 $.66
Discretionary cash flow
per common share $1.09 $1.00 $2.05
Weighted average
shares outstanding 33,433 30,435 30,435
SUMMARY OPERATIONS DATA
Oil production
(Bbl/day) 5,272 5,789 11,231
Gas production
(Mcf/day) 147,008 105,256 180,880
Equivalent barrels
(BOE/day) 29,773 23,332 41,378
Equivalent cubic
feet (Mcfe/day) 178,639 139,992 248,268
Average oil price
(per Bbl) $12.05 $19.22 $19.74
Average gas price
(per Mcf) $2.10 $2.34 $2.34
Average price per BOE $12.51 $15.33 $15.60
SNYDER OIL CORPORATION
(In thousands, except per share and price data)
(Unaudited)
Three Months Ended June 30,
Excluding As
Patina Reported
1998 1997 1997
Oil and gas sales $34,581 $26,315 $48,988
Cash expenses
Direct operating 9,340 8,156 12,503
General and
administrative 4,156 4,036 5,320
Financing costs, net 2,918 2,446 6,490
Other (income) expense (565) 244 63
Preferred dividends -- 1,550 1,550
Discretionary cash flow 18,732 9,883 23,062
Depletion, depreciation
and amortization 13,925 10,416 22,764
Property impairments -- 625 625
Exploration 7,305 3,687 3,690
(2,498) (4,845) (4,017)
Current income
tax expense -- 500 500
Deferred income
tax benefit (875) (1,653) (1,653)
Net loss before
special items (1,623) (3,692) (2,864)
Special items (net of deferred taxes)
Gains on sales of
equity interests
in investees -- 12,979 12,979
Gains on sales
of properties 846 1,453 1,453
Loss on sale
of subsidiary interest -- (6,500) (6,500)
Extraordinary item,
net of tax -- (2,848) (2,848)
Minority interest
in subsidiaries -- 73 (626)
Net income (loss) applicable
to common $(777) $1,465 $1,594
Net income (loss)
per common share $(.02) $.05 $.05
Discretionary cash flow
per common share $.56 $.33 $.77
Weighted average
shares outstanding 33,494 29,841 29,841
SUMMARY OPERATIONS DATA
Oil production
(Bbl/day) 5,447 5,763 11,325
Gas production
(Mcf/day) 157,855 101,643 178,756
Equivalent barrels
(BOE/day) 31,756 22,704 41,118
Equivalent cubic feet
(Mcfe/day) 190,536 136,224 246,708
Average oil price
(per Bbl) $11.10 $17.60 $18.33
Average gas price
(per Mcf) $2.02 $1.85 $1.85
Average price per BOE $11.97 $12.74 $13.09
SNYDER OIL CORPORATION
(In thousands, except per share and price data)
(Unaudited)
June 30, December 31,
SUMMARY BALANCE SHEET DATA 1998 1997
Cash and equivalents $40,134 $89,443
Other current assets 26,197 24,432
Investments 81,919 143,066
Oil & gas properties and
other long-term assets 334,865 289,147
$483,115 $546,088
Current liabilities $56,707 $57,549
Long-term debt 173,716 173,636
Other noncurrent liabilities 30,189 51,147
Stockholders' equity 222,503 263,756
$483,115 $546,088
SOURCE Snyder Oil Corporation
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Related links:
http://www.snyderoil.com
Company News On-Call: http://www.prnewswire.com or
fax, 800-758-5804, ext. 118962
CONTACT:
Rodney L. Waller of Snyder Oil Corporation,
817-882-5937
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