-- Earnings per share from continuing operations: 11 cents vs. 6 cents
-- Excluding merger costs: 17 cents vs. 6 cents
-- Major factors: Higher prices and higher production in E&P
PITTSBURGH, Oct. 19 /PRNewswire/ -- Consolidated Natural Gas Company
(NYSE: CNG) today reported 1999 third quarter income from continuing
operations of $10.8 million, or 11 cents a diluted share, compared with income
of $5.7 million, or 6 cents a diluted share, a year earlier. Excluding costs
related to the pending merger with Dominion Resources, Inc., of $7.7 million,
or 6 cents a diluted share after taxes, income from continuing operations in
the third quarter of 1999 was $16.4 million, or 17 cents a diluted share.
Primary reasons for the increase were higher prices and higher production
in CNG's oil and natural gas exploration and production segment.
"CNG performed extremely well in the quarter," said George A. Davidson,
Jr., CNG's chairman and chief executive officer. "We are on target to achieve
our goal of a 25 percent increase in production in 1999. In addition, income
in our natural gas transmission and storage segment rose 19 percent in the
quarter."
Davidson said the company expects to have all regulatory approvals for its
merger with Dominion Resources by year-end.
Results by Business Component
Here are the 1999 third quarter results for each of the company's business
segments:
Exploration and Production
Pretax operating income for exploration and production was $34.8 million
in the third quarter of 1999, up from $18.1 million a year earlier. The
improved results were due to higher prices and increased production of oil and
natural gas from the Gulf of Mexico.
The average wellhead price for CNG's gas production was $2.25 a thousand
cubic feet, up 20 cents from a year earlier. CNG's average wellhead price for
oil was $14.71 a barrel, up $3.45 from a year earlier.
Production of natural gas rose to 45.8 billion cubic feet (Bcf), an
increase of 9.2 Bcf, or 25 percent, from the third quarter of 1998. Oil
production rose to 2.7 million barrels, an increase of 875,000 barrels, or
48 percent, from a year earlier. The oil increase primarily came from the new
Nautilus/Nemo/Atlantis complex in the Gulf of Mexico. Oil and natural gas
production in the third quarter of 1998 was adversely affected by four
hurricanes and tropical storms that forced temporary shutdowns of wells in the
Gulf of Mexico.
Natural Gas Distribution
The company's four local gas utilities recorded a pretax operating loss of
$23.3 million in the third quarter of 1999, compared to a loss of $20 million
last year. A third-quarter loss for this segment is considered normal since
customers use less gas during the summer months.
Throughput increased to 54.1 Bcf from 51.8 Bcf in 1998, but the effect
was more than offset by higher operating and maintenance costs. Workforce
reduction costs related to a previously announced restructuring of CNG's
regulated businesses also reduced 1999 pretax operating results by
$1.2 million.
Natural Gas Transmission
Pretax operating income for the company's interstate natural gas pipeline
and storage business was $36.1 million in the third quarter of 1999, up from
$30.4 million a year earlier. The increase was partly due to increased prices
for natural gas by-products.
Transmission throughput in the 1999 third quarter was 109.2 Bcf, up from
104.5 Bcf a year earlier.
Consolidated Natural Gas Company is one of the nation's largest
producers, transporters, distributors and retail marketers of natural gas.
The company's natural gas transmission and distribution operations serve
customers in Pennsylvania, Ohio, Virginia, West Virginia, New York and other
states in the Northeast and Mid-Atlantic regions. CNG explores for and
produces oil and natural gas in the United States and Canada. The company also
selectively participates in energy businesses abroad.
This press release contains forward-looking statements. The company
wishes to caution readers that the assumptions which form the basis for
forward-looking statements with respect to or that may impact earnings for
fiscal 1999, and thereafter, include many factors that are beyond the
company's ability to control or estimate precisely, such as estimates of
future market conditions and the behavior of other market participants. Other
factors include, but are not limited to, weather conditions, economic
conditions in the company's service territory, fluctuations in energy-related
commodity prices, conversion activity, other marketing efforts and other
uncertainties.
CNG's recent news releases are available 24 hours a day on the Internet,
by fax machine, or by voice recording. On the Internet, use CNG's Web site:
http://www.cng.com. For faxing, call 1-800-758-5804 on a touch-tone phone and enter
CNG's extension number, which is 203456. From a menu, you will then be able
to select releases that will be faxed to you immediately without charge. For
voice recordings, call 1-888-CNG-NEWS. This line is toll-free.
Consolidated Natural Gas Company (CNG)
Three Months Ended September 30, 1999 1998
Total operating revenues $505,610,000 $423,448,000
Income from continuing
operations $10,820,000(a) $5,627,000
Discontinued operations ------- $2,425,000
Net income $10,820,000(a) $8,052,000
Earnings per common share
-- diluted
Income from continuing
operations $0.11(a) $0.06
Discontinued operations ------- $0.02
Net income $0.11(a) $0.08
Earnings per common share
-- basic
Income from continuing
operations $0.11 $0.06
Discontinued operations ------- $0.02
Net income $0.11 $0.08
Average common shares - diluted 95,953,000 96,215,000
Average common shares - basic 95,928,000 95,509,000
Nine Months Ended September 30, 1999 1998
Total operating revenues $2,118,493,000 $1,953,041,000
Income from continuing
operations $69,783,000(b) $190,474,000
Discontinued operations ------- $(46,724,000)
Net income $69,783,000(b) $143,750,000
Earnings per common share
-- diluted
Income from continuing
operations $0.72(b) $1.99
Discontinued operations ------ $(0.48)
Net income $0.72(b) $1.51
Earnings per common share
-- basic
Income from continuing
operations $0.73 $2.01
Discontinued operations ------- $(0.49)
Net income $0.73 $1.52
Average common shares - diluted 96,367,000 96,388,000
Average common shares - basic 95,691,000 94,664,000
(a) Includes impact of merger related expense of $7,672,000, or $0.06 a
diluted share after taxes, for costs related to the pending merger with
Dominion Resources, Inc.
(b) Includes impact of merger related expense of $173,010,000, or $1.19 a
diluted share after taxes, for costs related to the pending merger with
Dominion Resources, Inc.
SOURCE Consolidated Natural Gas Company
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Related links:
http://www.cng.com
CONTACT:
Dan Donovan of Consolidated Natural Gas,
412-690-1370
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